GDT falls back 7.4%

Published 3 February 16

The Global Dairy Trade (GDT) auction Price Index fell 7.4% at the latest event on 2 February, its third consecutive decrease. This takes the average weighted price to its lowest level since the beginning of September, at US$2,276/tonne.

Price Indices fell across all products traded, with WMP showing the biggest decrease of 10.4%. WMP is likely to have made up about half of the product offered (based on Fonterra’s forecast volumes), so this will have had a significant impact on the overall price reduction.

The fall in GDT comes as several NZ dairy processors also cut their forecast farmgate milk prices for the 2015/16 season (ending in May). Fonterra, Westland and Synlait have all reduced their prices, voicing concerns that continuing strong EU milk production is delaying dairy market recovery. Although EU production slowed slightly in November compared to October, volumes continued to run well above last year’s levels.

GDT 3Feb16