Dairy markets held steady at this week’s GDT auction from New Zealand, with average prices increasing marginally by less than 1%.

Fats continue to drive prices in dairy markets, with the price of butter increasing 1% above $6,000/t, while the average selling price of anhydrous milk fat increased strongly by 5% close to $6,800/t.

On the powder side, whole milk powder (WMP) prices continue to tread water above the $3,100/t mark.

Glut of milk

Prices increased slightly (+0.6%) this week, but the overall market for WMP has been very static since June, as we await the start of the seasonal glut of milk from New Zealand in the coming months.

On the skimmed powder (SMP) side, the market declined for the second auction in a row, with prices back more than 1% to $1,920/t.

Wet weather

Figures for August released this week show that New Zealand milk production for August declined almost 2% to 1.3m tonnes as the wet end to the winter impacts supply.

Both north and south islands of New Zealand were hit hard by heavy rains last month.

In Europe, markets remain very thin for butterfats, which can be seen in the further increase in Dutch butter prices this week to €6,980/t.

However, very little product is actually being traded at these prices and traders are reporting that markets in Europe are quiet overall.