Friday, March 29, 2024

AgriHQ milk price little changed

Avatar photo
The AgriHQ milk price was little changed this morning but was still well below Fonterra’s revised figure of $6.40/kg MS.
ANZ agricultural economist Susan Kilsby said global shipping costs have eased somewhat, though there are still challenges in moving goods.
Reading Time: 2 minutes

AgriHQ cut its farmgate milk price just one cent to $6.18/kg MS.

“WMP prices did lift at this week’s GDT event and prices for WMP futures contracts trading on the NZX Dairy Derivatives market are also stronger than they were two weeks ago when the AgriHQ forecast was last calculated,” AgriHQ senior dairy analyst Susan Kilsby said.

The WMP price index lifted 1.7% at the December 5 GDT auction. Regular grade WMP to ship in February was up 2.6%.

WMP futures prices had lifted by up to US$130/t over the past fortnight.

The Derivatives market expected WMP prices to reach US$2940/t by mid-2018.

Skim milk powder (SMP) prices were also stronger at this week’s GDT event. The short term outlook for SMP prices was a little stronger than it was a fortnight ago but the longer-term outlook was weaker.

The price for medium heat SMP to ship in February was up 6.4% at the December 5 GDT event. The December, January and February contracts for SMP were up by between US$5/t and US$40/t from a fortnight ago but remaining contracts until mid-2018 were down by up to US$40/t.

Butter milk powder (BMP) prices were also stronger this week. UHT grade BMP to ship in February was up 6.3% from when it last traded on GDT. BMP was offered only at the first event of the month.

Prices for butter dropped at the December 5 GDT event.

Unsalted butter to ship in February fell 11.6%. Prices for butter futures had fallen a similarly large amount, with some contracts down as much as US$450/t from where they were a fortnight ago. The Derivatives market expected butter prices to reach US$4740/t by mid-2018.

The price for regular grade anhydrous milk fat eased 1.2% at the December 5 GDT event. The outlook for AMF prices had similarly weakened. The NZX Dairy Derivatives market expected AMF prices to ease to US$5750/t by mid-2018.

The AgriHQ spot price was up four cents to $6/kg MS, bolstered by the stronger prices for milk powders.

The AgriHQ spot price indicated what the milk price would be if December 5 GDT prices were achieved across the entire season, at current exchange rates.

The cost of lactose had also declined slightly, providing some support to both the AgriHQ spot price and the AgriHQ forecast for the 2017-18 season.

Fonterra imported lactose because it did not produce enough to meet its needs.

The September 2018 milk price futures contract settled at $6.36/kg MS yesterday, up a cent from where it was two weeks ago.

However, it had lost that cent in trading this morning.

There had so far been two lots traded at $6.35/kg MS for the September 2018 contract this morning.

The September 2019 contract also eased in trading this morning. It lost two cents to trade at $5.98/kg MS.

Total
0
Shares
People are also reading