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Whole milk powder keeps GDT auction even

NZ NewswireNZ Newswire 19/07/2016 By Margreet Dietz
Infant formula on a shelf in a supermarket. © Reuters Infant formula on a shelf in a supermarket.

Dairy product prices have been mixed at the GlobalDairyTrade auction, as a gain in whole milk powder offset a decline for most other products.

The GDT price index slipped to $US2336 ($NZ3310), down from $US2345 at the previous auction two weeks ago. The index was unchanged in percentage terms. Some 31,348 tonnes of product was sold, down from 32,500 tonnes at the previous auction two weeks ago.

Whole milk powder rose 1.9 per cent to $US2079 a tonne.

Some support came from the European Union's latest financial support package for the region's struggling farmers, announced on Monday.

"The additional aid granted by the EU will help to slow growth in milk production - a trend that has already started to occur," AgriHQ dairy analyst Susan Kilsby said in a note.

"This will be beneficial to the market in the short-term as it will allow global supply and demand to rebalance more quickly."

However, continuing to support inefficient farms meant likely over supply situations again in the future, she said.

The AgriHQ Snapshot milk price slipped 1 cent to $3.71 per kilogram milksolids, while the AgriHQ 2016-17 milk price fell 6 cents to $4.48/kgMS as dairy commodity futures prices have generally eased in the past fortnight.

At the GDT auction, anhydrous milk fat inched 0.2 per cent higher to $US3628 a tonne, while rennet casein added 0.4 per cent to $US5286.

Butter milk powder slipped 0.5 per cent to $US1565 a tonne, while skim milk powder fell 1.1 per cent to $US1927 a tonne, and cheddar declined 1.1 per cent to $US2886 a tonne.

Lactose slid 4 per cent to $US721 and butter dropped 5 per cent to $US2687.

There were 133 winning bidders out of 168 participating bidders at the 13-round auction. The number of qualified bidders edged higher to 603, up from 602 at the previous auction.

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