Dairy commodities recover at Fonterra auction

Dairy commodity prices recovered slightly at Fonterra’s latest auction, after falling for the past three sales.

The weighted average increased by 1.1%, to US$4,958/t (£3,158), with all commodities showing an improvement bar buttermilk powder and cheddar. Butter led the recovery, rising by 4.7%, with skimmed and whole milk powder up by 3.2% and 2.2%, respectively. The auction saw 23,674t of product go under the hammer, 7.5% less than the same time last year but more than in recent sales.

Average prices are now 7.4% below their peak reached in mid-April, but more than 51% higher than the same time last year.

Back in the UK, daily milk deliveries remain 1.8% below the three-year average, at 39.5m litres in the two weeks to 8 June. However, more favourable weather had extended the spring peak, with production plateauing at a time of rising milk prices, said a report by DairyCo.

“The return to more seasonal weather has put milk production into a more favourable position, and producers should see milk cheques improving as June and July price rises take effect.”

Market report