November 7, 2013

New Zealand's dairy product prices fall again

Led by whole milk powder and butter, New Zealand's prices of dairy products fell in the second straight GlobalDairyTrade (GDT) auction, though the average winning price is still 42% higher than it was a year ago.

The GDT Price Index fell 1.8% compared to the last sale two weeks ago. The average winning price was US$4,797 a tonne compared to US$4,980 a tonne.

The average winning price of whole milk powder, the biggest product by volume, fell 3.7% to US$4,891 a tonne, the lowest since early July, and while butter dropped 7% to US$3,529 a tonne, a three-month low.

The auction comes after the ANZ Commodity Price Index, which tracks New Zealand's major export commodities, rose 1.3% in October, to close to just 1.8% below the all-time high set in April.

The benefits for New Zealand producers, though, were erased by the strength of the New Zealand dollar and the ANZ NZD Commodity Price Index fell 0.6% in October following a 1.1% decline in September. The trade-weighted index was last at 77.12, up from as low as 72.64 in early June.

The total volume of dairy products sold at the latest GDT auction rose to 49,304 tonnes from 43,261 tonnes two weeks ago. Anhydrous milk fat, butter milk powder, milk protein concentrate, cheddar, lactose and rennet casein all rose in price.