This week saw a rebound in New Zealand’s GDT auction, the benchmark dairy index, following more than two months of falling dairy prices.

At this week’s GDT, average dairy prices were almost 4% higher thanks to a lift in milk powder prices. This is the first positive result for the GDT since early July.

Average prices for whole milk powder (WMP), the key dairy commodity traded on the GDT platform, increased more than 3% this week to just under $3,000/t (€2,515/t).

There was also a strong lift (+8%) in the average price of skimmed milk powder (SMP) this week to hit $2,890/t (€2,435/t).

Cheddar also gave a strong showing at this week’s GDT, with average prices up more than 7% to $3,675/t (€3,095/t).

Meanwhile, the price of butter was down a little over 1% at this week’s auction to $3,280/t (€2,765/t).

The recent weakening of the US dollar against the euro has seen an interesting dynamic develop in global dairy markets. European butter prices are totally uncompetitive against world market butter prices and almost €650/t more expensive.

In contrast, the price of European SMP is over €300/t cheaper than the same product sourced in New Zealand.

Overall, dairy prices in Europe are generally steady, with milk powder prices showing some upward momentum. European SMP prices lifted again this week and are now trading at €2,150/t to €2,200/t, while WMP prices increased to €2,730/t.

European spot prices for butter and cheddar were steady this week at €3,400/t and €3,150/t respectively.