It has fallen from 1056 in mid January to 978 after the second February GDT event.
While now at the lowest point for the past 12 months it is only 10% below the highest point of 2019, which was 1086 last May.
In other words, global dairy prices have moved in a very narrow band of plus or minus 5% over the past year when compared with high volatility periods historically.
Though it remains to be seen, should the impact of the coronavirus on dairy trade be limited to that range of movement seen over the past 12 months, NZ dairy farmers will have reason to cheer.
It will be validation of what ASB senior rural economist Nathan Penny has called a higher plateau of farmgate milk prices stemming from a supply/demand balance that is more stable and not easily upset.
He predicts milk prices will average $7/kg over the next decade in a range between $6.50 and $7.50, compared with the $6 average of the past decade.
That optimistic outlook is based on moderate growth in global dairy production and exports as all the main producing countries run into constraints.
They include environmental and regulatory measures on nutrients and greenhouse gases, capital constraints and competition with other primary industries and urban needs for resources like land and water.
Penny pointed out the average annual milk production growth in NZ of 5% over the 15-year period between 2001 and 2015.
During that time the supply and demand factors in world dairy moved quickly.
Fonterra began its existence with farmgate milk prices that typically moved 50c or $1 between seasons.
But in 2007-08 and the beginning of the commodities boom that movement blew out to $3 and even $4 between seasons, making it very difficult for farmers and their financiers to plan and budget.
The $6 average of the past decade contains an $8-plus and a $4-plus, reflecting the high volatility of world prices that made forecasting very difficult.
Fonterra also had to build processing facilities for more milk production, up to 10% in a season, which occurred twice during that decade.
Since 2015 NZ milksolids production has been plus or minus 2% from one season to the next, including what commentators expect to be nil growth this season.
Lower long-run NZ dollar forecasts also underpin the dairy prices and their translation into farmgate prices.
ASB expects the NZD/USD cross-rate to average 69c over the next 10 years, compared with a previous forecast of 73c. The cross-rate average this season has been 65c versus 69c last season.
At current dairy commodity prices a one cent move in currency changes the farmgate price by 14c/kg.
Because of its hedging policy Fonterra won’t fully capture the currency benefit this season but should be able to gain 30c/kg in the 2021 milk price forecast, Penny said.
Whatever happens to GDT prices as a result of coronavirus disruption, dairy farmers can rest more easily on the higher plateau of world dairy markets.
