Archive: GDT auction decline limited by positive result for WMP

Published 4 November 14

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The latest Fonterra GlobalDairyTrade (GDT) auction (4 November) concluded with a 0.3% fall in the overall auction index. The overall auction reduced marginally despite reductions from the majority of products, notably Cheddar and butter (down 9.2% and 4.1% respectively). These reductions were largely offset by the 1.6% increase in the winning WMP average price as WMP volumes typically account for the majority of product sold on the auction. The latest increase to WMP prices has potentially been supported by a reduction in the volumes offered by Fonterra.

The next auction takes place on 18 November and a sustained period of neutral prices could indicate some stability in prices in a year of auctions dominated by large decreases. However, forecasts such as those from Rabobank suggest that the current surplus of product will keep prices low for a while, with an upturn in prices potentially as late as Q3 2015.

GDT auction 4 Nov