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Dairy prices rise at auction

NZ NewswireNZ Newswire 17/05/2016

Dairy product prices have risen 2.6 per cent at Fonterra's fortnightly GlobalDairyTrade auction.

The average price per metric tonne lifted to $US2283 ($NZ3364) on Wednesday morning (NZT).

It was helped by a rise in the important whole milk powder price, which was up 3 per cent to $US2252.

The rise followed a 1.4 per cent drop at the previous auction.

"The lift in whole milk powder prices on GDT was supported by the low volumes of whole milk powder currently on offer," AgriHQ dairy analyst Susan Kilsby said.

The volume of whole milk powder Fonterra made available for sale on GDT was the lowest it has offered to the market in more than three years, Ms Kilsby said.

Fonterra expects to collect 3 per cent less milk this season than last season.

"Despite the reduced milk flows Fonterra has still been selling product at a similar rate to last season which has resulted in a reduction in stock levels," Ms Kilsby said.

The AgriHQ 2015-16 forecast is unchanged at $4.11 per kilogram of milk solids as a small lift in dairy commodity prices recorded at the GDT event was offset by lower futures prices, she said.

It is forecasting a slight lift in the milk price forecast for next season which sits at $4.64/kgMS.

At the GDT auction, butter milk powder soared 16.2 per cent to $US1545 a tonne, while anhydrous milk fat climbed 4.9 per cent to $US3340 a tonne.

Lactose, butter and rennet casein also rose. Skim milk powder and cheddar slipped slightly.

The New Zealand dollar last traded at 68.36 US cents at about 12.23pm in New York, compared with 67.91 US cents at 5pm in Wellington the previous day.

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