Skimmed milk powder slumps 8% at Global Dairy Trade auction
Global Dairy Trade prices fell for third consecutive auction today with prices down 1.2pc.
Skimmed Milk Powder saw a significant decline at the auction with prices down some 8.6%. Whole Milk Powder prices were stable up 0.1pc.
Butter prices were also unchanged at the auction while Cheddar prices fell almost 4pc.
New Zealand, the world's largest dairy exporter, had suffered from curbed supply caused by unusually dry weather late last year, which had pushed up prices. Wetter weather in recent weeks led to a more favorable outlook for supply, which meant further price gains were likely to be muted.
"From here, we expect prices to ease further through to the end of the season. We expect NZ production to improve on the back of the increased rainfall.
“In turn, this improved production should put modest downward pressure on prices," said Nathan Penny, ASB economist.
In Europe, the EEX SMP Index recently fell to €1297/tonne, a record low with the overhang of SMP stocks on the market continuing to have a destabilising impact.
EU milk collections in 2017 increased by 1.8pc.