Prices face upside risk despite GDT price dip
After five consecutive rises, whole milk powder prices dipped in the latest Global Dairy Trade (GDT) auction.
The final Global Dairy Trade (GDT) auction for the 2023-24 season augurs well the forecast milk price for the new season.
While the banks are forecasting between $8.35 to $8.40/kgMS, Fonterra later this week, its forecast range for the season starting June 1.
Last week's GDT delivered good news: while the price index rose 3.3%, Chinese buyers returned after pulling back in the earlier May auction. Also, whole milk powder prices rose 2.9% to US$3,408/metric tonne.
Westpac chief economist Kelly Eckhold noted that auction was "another very strong one with gains across the board".
"All categories rose and wrong-footed futures markets, which again saw a much flatter result," says Eckhold.
"Chinese buyers returned this time after pulling back in the early May auction. Overall prices are now 10 per cent or so above their long-term averages. We can certainly see upside risk building to our milk price forecast of $8.40/kgMS for the 2024/25 season."
ASB senior economist Chris Tennent-Brown believes farmers can hope for a farmgate milk price in the top half of Fonterra's guidance range ($7.50-$8.10/kgMS) this year.
"We remain comfortable with our $8.35/kgMS forecast."
As storms and flooding continue to batter the East Coast, the Insurance & Financial Services Ombudsman has issued advice for those impacted and looking to claim with their insurer.
Federated Farmers Gisborne/Wairoa president Charlie Reynolds says farmers are in need of emotional support after rain, wind and flooding hit the region this week.
Minister for Emergency Management Mark Mitchell says the Mayoral Fund has been triggered, activating $300,000 for regional recovery after severe weather hit the East Coast this week.
States of Emergency have been declared in Haumoana, Wairoa and Hastings after storms have once again battered the East Coast of the North Island.
Dairy processors are happy with the Government’s move to reduce redtape for exporters.
The fortunes of the dairy industry are expected to bounce back in about a year’s time, according to the Director General of the Ministry for Primary Industries (MPI), Ray Smith.
OPINION: Synlait's woes continue to drag the company down. The listed milk processor’s share price dropped to an all-time low…
OPINION: Industry-good bodies have had a torrid time recently, with some facing backlash from farmers particularly over their stance on…