The big news from dairy markets this week is that the Global Dairy Trade (GDT) auction went up by a staggering 6.7% in a largely unexpected twist.
Sentiment has been improving in recent weeks, despite no real change to the fundamentals, with plenty of supply coming on stream.
However, a reluctance to sell has obviously spooked buyers into paying more for dairy products.
At first, it was just powders at the GDT that were increasing in price, but now it’s butter and cheese too.
Butter increased by a substantial 8.8%, while anhydrous milk fat also increased by 5%.
Cheddar and mozzarella both increased, by a respectable 3.8% and 10.6% respectively. Skim milk powder (SMP) also increased by 10.6%, which is a huge gain, to reach €2,427/t, which is over €230/t of a premium over the European spot.
Whole milk powder (WMP) also took a turn upwards, increasing by 5.3% to reach €3,052/t, which is about €50/t behind the European price.
This indicates that skim- and protein-based products in general are in high demand globally. It will be interesting to see if these prices hold out for subsequent auctions.
Over the last three GDT events, the index has increased by 14.5%, which is hard to believe considering the general negativity in the market.
It’s a sign of the volatility in the market. In Europe, the spot market is just about holding its own, with increases for butter, WMP and SMP, but declines for cheese. Meanwhile, the Ornua PPI declined for December to 38.66c/l excluding VAT but including Ornua value payment.
The big news from dairy markets this week is that the Global Dairy Trade (GDT) auction went up by a staggering 6.7% in a largely unexpected twist.
Sentiment has been improving in recent weeks, despite no real change to the fundamentals, with plenty of supply coming on stream.
However, a reluctance to sell has obviously spooked buyers into paying more for dairy products.
At first, it was just powders at the GDT that were increasing in price, but now it’s butter and cheese too.
Butter increased by a substantial 8.8%, while anhydrous milk fat also increased by 5%.
Cheddar and mozzarella both increased, by a respectable 3.8% and 10.6% respectively. Skim milk powder (SMP) also increased by 10.6%, which is a huge gain, to reach €2,427/t, which is over €230/t of a premium over the European spot.
Whole milk powder (WMP) also took a turn upwards, increasing by 5.3% to reach €3,052/t, which is about €50/t behind the European price.
This indicates that skim- and protein-based products in general are in high demand globally. It will be interesting to see if these prices hold out for subsequent auctions.
Over the last three GDT events, the index has increased by 14.5%, which is hard to believe considering the general negativity in the market.
It’s a sign of the volatility in the market. In Europe, the spot market is just about holding its own, with increases for butter, WMP and SMP, but declines for cheese. Meanwhile, the Ornua PPI declined for December to 38.66c/l excluding VAT but including Ornua value payment.
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