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.
Last night’s auction saw an average price decline of 3.6% to US$2,620, down from US$2,746 at the previous auction two weeks ago.
Skim milk powder saw the greatest drop, down 7.8% to US$2,253 a tonne, while butter fell 6.6% to US$3,026 a tonne, and whole milk powder slid 4.3% to US$2,446 a tonne.
Rennet casein also saw a small decrease of 0.6% to US$6,949 a tonne.
However, gains were made in buttermilk powder, which rose 2.1% to US$2,208 a tonne, while anhydrous milk fat was up 2.3% to US$3,744 a tonne, and cheddar increased 2.7% to US$2,888 a tonne.
Last night’s result was the lowest level since the last auction of 2014. Some 25,596 tonnes of product was sold, up from the 23,162 sold at April 1 auction two weeks ago.
