World dairy prices up a notch overnight
PRICES of dairy products edged up in the latest GlobalDairyTrade auction, snapping two straight declines, as the volume sold rose to a two-month high.
The GDT Price Index, previously known as the GDT-TWI Price Index, rose 0.1 per cent compared to the last sale two weeks ago. The average winning price was US$4,805 a tonne compared to US$4,797 a tonne.
The average winning price of whole milk powder, the biggest product by volume, was unchanged at US$4,870 a tonne, the lowest since early July, and skim milk powder rose 0.7 per cent to US$4,583 a tonne. Cheddar rose 4.5 per cent to US$4,584 a tonne, the highest since early June, while rennet casein fell 5.4 per cent to US$9,418 a tonne.
This month Fonterra disclosed a $157 million provision against inventory of specialised ingredients and branded consumer products produced by NZ Milk Products division, saying rising input costs squeezed margins.
It noted an increase for the reference products it uses to calculate the farmgate milk price compared to its value added products.
The total volume of dairy products sold at the latest GDT auction rose to 52,297 tonnes, the first time the volume has been above 50,000 tonnes since September 3, from 49,304 tonnes.
The price of anhydrous milk fat fell 1.6 per cent to US$5,255 a tonne and butter rose 1.7 per cent to US$3,583 a tonne. Butter milk powder fell 0.1 per cent to US$4,753 a tonne.
Milk protein concentrate rose 0.6 per cent to US$7,787 a tonne and lactose wasn't offered.
There were 147 winning bidders over 12 rounds. There were 206 participating bidders out of a total number of qualified bidders of 826.