Dairy prices have resumed their slide, falling 4.9 per cent at the latest GlobalDairyTrade auction overnight.
The drop, the second-biggest of the year after an 8.9 per cent plunge at the April 1 auction, was the ninth fall out of the last 10 auctions, the only increase being at the previous auction two weeks ago when prices edged up by 0.9 per cent.
The average winning price at the latest auction was US$3595 per metric tonne, down 28.7 per cent from the recent peak of US$5042 on February 4. The auction platform’s trade-weighted price index was down by an almost identical percentage.
Prices were put under pressure by a big increase in supply, with a maximum supply of 43,249 tonnes, up almost 33 per cent from the previous auction, with 41,513 tonnes sold.
The auction attracted 184 participating bidders, with 149 winning bidders.
Whole milk powder, the biggest category by volume, drove much of the overall decline with a 5.4 per cent drop in price.
Butter had the largest fall, down 13.6 per cent, while anhydrous milk fat declined by 7.4 per cent.
Cheddar (down 2.9 per cent), rennet casein (down 2.1 per cent) and skim milk powder (0.9 per cent) all fell, while butter milk powder bucked the trend up 4 per cent, the only price increase at the auction.
The GlobalDairyTrade auction platform is owned by Fonterra, which accounts for about 90 per cent of the product sold at the auctions.