May 17, 2013
World's dairy product prices decline further
As a resurgent US dollar weighed more generally on commodity prices and concerns about the impact of drought in New Zealand's North Island abated, global prices of dairy products extended their decline from a record high.
The Global Dairy Trade-Trade Weighted Index (GDT-TWI) price suffers its second decline this year, with a drop of 2.1% compared to the last sale two weeks ago. The average winning price fell to US$4,549 a tonne from US$4,597 a tonne. The price reached US$4,968 a tonne last month, the highest since the GDT platform began in July 2008. Whole milk powder, the biggest product by volume, fell 1.7% to US$4,722 a tonne.
The dollar index, which tracks the greenback against a basket of currencies, is at its highest levels this year amid speculation the Federal Reserve may signal an end to quantitative easing, though it eased overnight on weaker-than-expected US industrial production.
The total volume of dairy products sold at the latest auction was 17,637 tonnes from 17,237 tonnes two weeks ago. The price of anhydrous milk fat fell 0.2% to US$4,598 a tonne and butter milk powder dropped 5.1% to US$3,876 a tonne. Butter tumbled 12.4% to US$3,846 a tonne.
Cheddar, lactose and milk protein concentrate were not offered. Rennet casein rose 3.7% to US$10,105 a tonne and skim milk powder fell 2.8% to US$4,252 a tonne.
