Global Fortnightly Update: Dairy Prices Ease06 May 2013
GLOBAL - GlobalDairyTrade event 91 concluded this week with the Trade-Weighted Index (TWI) down 7.3 per cent , ending a string of nine consecutive rises that began in late December 2012, according to Dairy Australia.
All products except cheddar saw prices ease, bringing about a correction expected by many traders who have reported increasing resistance to surging prices.
In a fortnight that saw speculation about rain ending the drought in parts of New Zealand, WMP prices fell by an average of 10.2 per cent to US$4,721/t, still 50 per cent above December levels.
SMP finished down 9.5 per cent to an average of US$4,280/t, with product from all origins losing ground. Fats were a bit slower to retreat, with butter dropping 6.7 per cent to an average of US$4,409/t and AMF by 5.2 per cent to US$4,675/t. Full results at www.globaldairytrade.info.
GDT will welcome a new seller from event 93 on June 4th, with Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF) offering SMP and WMP under the Amul banner. GCMMF is India's largest cooperative with 3.2 million milk producers and is the country's largest dairy exporter.
Fonterra has announced a 2013/14 pilot of its new 'Guaranteed Milk Price' (GMP) model that allows farmers to lock in a fixed price at the beginning of the season for up to 75 per cent of their milk production.
The initial pilot will involve around 200 farmers across New Zealand. The cooperative has also announced an intention to cut up to 300 middle management and business support roles, generating projected ongoing savings of NZ$65m (excluding restructuring costs).
The milk processing subsidiary of Irish dairy cooperative Glanbia has confirmed plans to construct a €150m plant to produce nutritional powders for export. Work is scheduled to begin around mid-May with the Belview Port (County Kilkenny, Ireland) facility expected to begin operation in spring 2015, handling additional post-quota milk production.