Strong production, tested demand send milk prices crashing
Strong global milk production and rebalancing of demand among key buyers has delivered one of the biggest drops in whole milk powder prices in recent years.
New Zealand dairy farmers woke up to some very good news. The overnight Global Dairy Trade (GDT) auction recorded a massive jump in prices.
The GDT price index jumped 15% compared to the previous auction, its eighth consecutive price rise.
Whole milk powder prices, used by Fonterra to set its milk payout, rose a whopping 21% to US$4364/MT, a seven-year high.
AMF index up 7.4%, average price US$5,929/MT
Butter index up 13.7%, average price US$5,826/MT
BMP index down 0.3%, average price US$3,144/MT
Ched index up 1.3%, average price US$4,280/MT
LAC index up 4.9%, average price US$1,278/MT
SMP index up 3.5%, average price US$3,302/MT
SWP not offered
WMP index up 21.0%, average price US$4,364/MT
Relationships are key to opening new trading opportunities and dealing with some of the rules that countries impose that impede the free flow of trade.
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The former chair of the Bay of Plenty Regional Council and farmer, Doug Leeder, says rural communities' biggest fear right now is the lack of long-term certainty over environmental regulations.
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