Wednesday, July 6, 2022

Commodity prices firm again on GDT auction

The latest GlobalDairyTrade auction resulted in a 2.3% increase in the GDT Price Index.  The strong result countered the slight decrease in prices recorded at the previous auction.  Higher prices were achieved for virtually all commodities on offer excluding skim milk powder (SMP) and butter milk powder (BMP).  Volumes on offer at this auction were high with Fonterra offering just slightly less product than they did at the previous auction when offerings were at their seasonal peak.  Seasonal decreases in forecast volumes will occur from now on, and in addition forecast volumes are well down on the volume traded last year on GDT.  Whole milk powder (WMP) prices increased by 2.7% on average with greater gains in the nearby delivery contracts.  All Fonterra WMP on offer was sold above US$5,000 tonne, with Amul product selling near the US$4,000/tonne level. The SMP Price Index was down by 0.7%.  The highest price paid for SMP was US$4,700/tonne paid for DairyAmerica Low Heat Upgraded SMP for September delivery.  In the October delivery month Fonterra product was still priced higher than DairyAmerica product but the price premium has been squeezed back to about US$200/tonne for comparable product.  Fonterra’s SMP generally attained lower prices than at the previous auction while prices for DairyAmerica product firmed. Meanwhile Amul product was discounted by approximately US$1,000/tonne to trade at US$3,305 – $3,245/tonne. Anhydrous milkfat (AMF) prices firmed considerably following their fall at the previous auction.  The AMF Price Index was up 7.1% with product selling at an average price of US$4,931/tonne.  Butter was also priced higher with the Butter Price Index up 3.3%.  DairyAmerica butter eased back slightly, while Fonterra’s unsalted butter scheduled for October delivery made up the gains it lost at the previous auction to trade at US$3,675/tonne.  Later delivery periods prices were at a slight discount.    

Link to full auction results

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