Wednesday, 05 October 2016 10:39

Dairy prices ‘catch their breath’

Written by 
ASB senior rural economist Nathan Penny. ASB senior rural economist Nathan Penny.

The GlobalDairyTrade Event 173 concluded with the GDT Price Index down 3% over night.

“In view of the recent price surge, it is not surprising dairy markets wanted to catch their breath. WMP prices, for example, had spiked 35% over August and September,” says ASB senior rural economist Nathan Penny.

Whole milk powder (WMP) and skim milk powder (SMP) prices dipped 3.8% and 3.9%, respectively.

“The result was a touch weaker than expectations heading in. Futures market pricing hinted at a WMP fall in the 0% to 2% range prior to the auction.

“The price dip was broad-based, with seven out of eight products on offer recording price falls. Only butter milk powder recorded a rise (up 9.3%).

“From here, we expect prices to track largely sideways over coming auctions as markets wait for further confirmation of weakening NZ production.”

Key Results

AMF index down 1.0%, average price US$4,954/MT

Butter index down 0.3%, average price US$3,891/MT

BMP index up 9.3%, average price US$2,408/MT

Ched index down 2.3%, average price US$3,430/MT

LAC index down 9.7%, average price US$744/MT

RenCas index down 3.7%, average price US$6,574/MT

SMP index down 3.9%, average price US$2,209/MT

WMP index down 3.8%, average price US$2,681/MT

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