Three successive rises for Global Dairy Trade auction

The Global Dairy Trade (GDT) index, an indicator of international dairy market sentiment, has built on its strong performance in recent weeks, rising by 5.9% in the latest auction (6 February).

The increase takes the auction average price to $3,553/t (£2,562/t), restoring the index to its highest level since September 2017, 13.5% above the lows seen in mid-December of that year.

According to Nick Holt-Martyn of The Dairy Group, the rise equated to 25.3p/litre, 1.3p/litre above last week’s actual milk price equivalent (Ampe) price.

See also: Milk and cereal sectors drive up Scottish incomes

All products traded saw an increase in value, with skim milk powder (SMP) and whole milk powder (WMP) – the auction’s two most-traded commodities – performing particularly well.

 

SMP rose by 7.2% to average $1,932/t (£1,391/t), while WMP increased by 7.6% to $3,226/t (£2,322/t).

Cheddar, butter milk powder and butter saw similarly strong returns, increasing 7.2% to $3,739/t (£2,691/t), 8.4% to $2,039/t (£1,468/t) and 7.9% to $5,277/t (£3,798/t), respectively.

Drought fears 

The positive result follows sustained dry weather during the New Zealand summer, fuelling fears of a drought as well as the prediction of 3% fall in production over this season by the country’s largest dairy co-op, Fonterra.

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