First, let’s look at the very good news and that comes from the latest Global Dairy Trade (GDT) auction, where the overall index increased by 2.3%.

Since 5 September, the overall index has increased by 22.7% in what has been a sustained turnaround in prices after almost nine months of yoyo sentiment in dairy markets.

In the latest auction, both skim milk powder (SMP) and whole milk powder (WMP) increased, with SMP rising by 1.2% and WMP rising by 1.7%.

Skim had been struggling to keep up with the gains in WMP.

There was also gains for fats, with butter rising by 5.8% and anhydrous milk fat rising by 4.3%.

The total product sold at this auction was once again back on usual quantities, with just short of 25,000t sold.

Now we come to the not very good, but arguably less important news and that is the European spot market price.

Prices for WMP, SMP and butter all fell this week by between €20 and €45 per tonne, which by itself is not a major fall, but it is a continuation of the negative trend which emerged before Christmas.

So, on the one hand, we have the GDT powering ahead, but, on the other, we have spot market prices closer to home on a more negative footing.

One thing to note is that the European prices for WMP and butter are still significantly higher than the GDT price, so there may be some natural correction taking place.

SMP prices are more closely aligned.

US Butter and cheese prices have increased by 2.7% and 2% respectively over the last two weeks.