The overall GDT Price Index dropped 3.9%.
WMP sold at an average of US$3294/t.
‘It appears there simply weren't enough buyers willing to pay any higher prices to absorb the extra supply on offer,” AgriHQ dairy analyst Susan Kilsby said.
Fonterra made 12,850t of WMP available, having lifted its offer volumes by a further 5% last week.
That meant there was 6% more WMP available for buyers than at the previous auction but the volume available was still less than was offered at this time a year ago.
In a note to the market last week Fonterra said the higher offer volumes for WMP were because of the returns for that product being greater than other products.
"This reflects the continued higher milk returns for WMP at current prices and consequently Fonterra is using its production flexibility to move milksolids out of other products,” it said.
It also clarified the lift in volume was not reflective of any change its expected milk intakes and its forecast for the 2016-17 season remained 7% below the previous season.
The NZX Dairy Derivatives market had anticipated a relatively flat result for WMP but that did not play out in the auction overnight.
Skim milk powder (SMP) prices were expected to rise and buyers were supportive of this product at last night's event.
The SMP Price Index lifted 2.3% with SMP selling at an average price of US$2660/t.
Fonterra-supplied SMP continued to trade at a premium to product supplied by European dairy company Arla.
Milkfat product prices were relatively stable, as expected, with just a 0.6% fall in the price index for anhydrous milk fat and a 0.5% lift in the butter price Index.
The prices for AMF and butter were now quite closely aligned when considered on a milk fat basis. A few months ago AMF was trading at a premium to butter but prices had now corrected as AMF pricing softened while butter strengthened.
The auction attracted 151 participating bidders with 120 buying. Slightly fewer bidders participated than in recent months but the number of successful bidders was similar to the previous auction.
