Milk Glut Drags Fonterra Forecast Down to $9.20/kgMS
A milk glut around the world shows no sign of easing, putting downward pressure on farmgate milk prices for the next few months.
The overnight Global Dairy Trade (GDT) auction on Wednesday saw the price index drop by 3.9%; whole milk powder prices dropped 4.2% to US$2797/metric tonne.
Rabobank senior dairy analyst Emma Higgins says clearly the onset of coronavirus stalled the upward trajectory in global dairy prices visible in late 2019 and the corona hangover continues as evidenced by the GDT Event.
She says the results are now the fourth decline for 2020.
“The GDT Price Index moved lower by 4% with average prices now sitting below USD 3,000/tonne (USD 2,980/tonne). This is now in line with average prices back in January last year. Buyers and sellers are still scrambling to assess the market impact as the spread of the virus moves from China to more broadly across the globe.”
Key results
AMF index up 1.0%, average price US$4,331/MT
Butter index up 0.3%, average price US$4,144/MT
BMP not offered
Ched index up 2.6%, average price US$4,398/MT
LAC index up 4.9%, average price US$914/MT
RenCas index up 1.0%, average price US$9,987/MT
SMP index down 8.1%, average price US$2,527/MT
SWP index not available, average price not available
WMP index down 4.2%, average price US$2,797/MT
