Prices of dairy products snapped a three-month slide in Fonterra Cooperative Group’s latest GlobalDairyTrade auction, lifting the average winning price from the lowest level since August.
The GDT-TWI Price Index rose 1.5 percent compared to the last sale two weeks ago. The average winning price gained to US$3,277 a metric tonne. Rennet casein and cheddar were the biggest gainers while whole and skim milk powder fell.
The sale is the first since Fonterra last week posted an 18 percent gain in first-half profit on increased sales and higher prices from its ingredients business.
Chairman Henry van der Heyden said prices have remained “relatively stable” though they were off their highs of last year.
The average winning price for whole milk powder fell 2.8 percent to US$3,227 a metric tonne and skim milk powder fell 0.8 percent to US$3,078 a tonne.
Anhydrous milk fat rose 8.3 percent to US$3,583 a tonne. Butter milk powder wasn’t offered at this week’s sale.
Cheddar rose 13.2 percent to US$3,371 a tonne and milk protein concentrate gained 13.1 percent to US4,705 a tonne. Rennet casein gained 13.8 percent to US$7,290 a tonne.
There were 104 winning bidders over 13 rounds, out of 139 participating bidders. The number of qualified bidders rose to 603 from 592.
(BusinessDesk)
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9 Comments
I have a conflict, I read your headline than I read whats in the international media and get this, who to believe?
Whole milk powder prices dip to 19-month low
Whole milk powder prices cast a cloud over an improved result at the latest globalDairyTrade auction by falling to their lowest in 20 months, amid lingering fears for dairy market prospects.
Dairy values overall at the twice-monthly auction rose 1.5%, only their second rise of the year, reflecting rebounds of more than 13% in prices of cheddar cheese, milk protein concentrate and rennet casein from the last session.
However, skim milk powder prices fell 0.8% to their weakest since December 2010.
Whole milk powder prices dropped 2.8% to their lowest since August 2010, and down 30% from a peak in March 2011.
The downward direction of milk prices, rather than the recovery in values of other dairy products, tied in greater with market thinking.
http://www.agrimoney.com/news/whole-milk-powder-prices-dip-to-19-month-…
Everyone looks at the spot price for everything.....its news I suppose, "oh its up today the recession is over" I see so little attention to trends or real analysis ie noise removal....its pathetic IMHO, or maybe desperate.....ditto arcticles what the $NZD is doing, it really doesnt matter....day to day or week to week, I dont even bother reading them.
regards
Don't worry Andrew, it is only interest.co's credibility on the line for publishing Fonterra press releases without thinking or checking any details.
From what I can see the percentage of qualified bidders participating (23%) was the lowest in globalDairy Trade's history.
As long as gDT continue to hide the volumes offerred it is reasonable to presume that the significant lift in some prices was primarily due to - possibly sharp - reductions in volume.
Further, I notice the average winning price is down more than three percent to USD 3,277 per metric tonne from 3,396 at the last auction.
Mitre: While only a small amount of overall Fonterra product is sold at the auction, I have been told the prices achieved are actually used as the basis for 60-70% of Fonterra's sales.
Arla and Murray Goulbourn joined the GdT platform for the first time at this auction. With more and more international players in the industry now using the auction, it becomes more significant as a price setting mechanism.
CO: That's it exactly. Is it sensible to encourage a thin auction to set the value of the bulk of an industries products and seemingly benchmarking world prices. Also one could guess that 100,000 tonne negotiated deals are substantially lower in price that a 50 tonne parcel via auction.
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