Saturday, March 30, 2024

Little change at GDT auction

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Another indifferent result pushed the Global Dairy Trade index down 1% overnight in an auction where the only price lift was for anhydrous milk fat.
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Whole milk powder prices were down 0.5% overall but powder to be shipped before year-end were sold at a premium.

They were most likely finding support from Chinese buyers securing product to land in China early in January in the lower tariff window.

Regular grade WMP to ship in December gained 1.5%, a little less than the NZX Dairy Derivatives market expected, AgriHQ dairy analyst Susan Kilsby said.

“Falling New Zealand milk production should be supporting WMP prices, however, Fonterra lifted its WMP offer volumes from forecasts last week.

“Buyers seem confident they will be able to source WMP when they need it so are not competing too hard for product.”

Skim milk powder prices plummeted 5.6% when a flat result had been expected.

SMP prices had been driven by factors around the European Union’s government-run intervention scheme.

“There is speculation SMP might not be bought at a fixed price under this scheme next year, which would effectively remove the price support that Europe has for SMP,” Kilsby said.

There was still close to 400,000 tonnes of SMP stockpiled over the last two years that was yet to be sold.

Anhydrous milk fat lifted 5.2%.

 AMF had been undervalued on a milk fat content basis compared to butter for a number of months so a lift in price and a fall in butter prices went some way to closing the gap.

Butter prices were back 2.5%. 

Cheddar eased a marginal 0.1%. Gains in prices for product to ship in December and February were not enough outweigh the fall in prices for product to ship in January and March.

Rennet casein prices dropped 8.6%. Lactose prices were not published as the only product sold was sold at the starting price. No butter milk powder was offered.

There were 137 winning bidders for 35,669t of product sold.

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