Slight rise in GDT dairy auction price
Decreased supply led to a slight rise in prices at last night's global dairy auction.
GlobalDairyTrade's trade-weighted price index overnight rose 0.2 per cent compared with the last sale two weeks ago.
The average winning price was up to US$4990 (NZ$6048) a tonne from US$4973 a tonne.
Maximum supply – the measure of how much product New Zealand dairy giant Fonterra has for sale – dropped to 48,338 tonnes from 52,697, with 47,858 tonnes sold.
OM Financial senior foreign exchange and derivatives adviser Stuart Ive said the drop in volume, which led to the price rise, reflected the time of year.
Supply would increase as the New Zealand summer progressed, he said.
The supply and demand situation was a good one, he said, and selling less would keep prices up.
In the latest auction, seven of the nine product categories rose and one was not traded.
Butter led the gainers, up 7.9 per cent, with rennet casein up 7.3 per cent.
Whole milk powder, the biggest category by volume, was the only product category to decline – down 1.5 per cent.
In last night's auction, 202 bidders took part, with 133 winning bidders, and 823 qualified to bid.
Swedish-Danish dairy co-operative Arla Foods sold its British skim milk powder in the GlobalDairyTrade auction for the first time.
American company Land O'Lakes said last week that it would begin offering skim milk powder from March 4.
It also planned to offer butter through the platform next year.
GlobalDairyTrade is owned by Fonterra, with Fonterra products representing 89 per cent of the product sold in the fortnightly auction.
United States, Australian, Indian, European and Scandinavian dairy companies also sell their products on the independent platform.