GLOBAL - This week's Global Dairy Trade auction saw a fall in the overall price indices of 3 per cent, but dairy industry watchers suggest that might not be a bad thing.
All the commodities at the auction fell in price, except butter milk powder which rose by 9.3 per cent.
Skimmed milk powder fell in price by 3.9 per cent, whilst whole milk powder fell by 3.8 per cent.
Butter and other fat prices had previously been rising rapidly, helping to pull up the overall auction price. However, some New Zealand dairy futures prices are reported to have eased over the last week according to AgriHQ, so the loss of price momentum may not be entirely unexpected, according to UK levy board AHDB Dairy.
Meanwhile, the Irish Farmers Association (IFA) National Dairy Committee Chairman Sean O’Leary said the price fall was not necessarily a bad thing, as it might help avoid global dairy prices overheating.
He said the recovery trend remains solid, with output easing in all regions bar the US.
“Since mid-July, the GDT index has increased 28 per cent, even allowing for today’s small decrease. This trend is based on lower global milk supplies, and these are also pushing EU dairy commodity prices up in a way which makes it clear that dairy markets are now in full recovery mode,” he said.
“Demand is also reasonably buoyant, with Chinese dairy imports up 27 per cent for the January to August period, partly due to a disimproving level of self-sufficiency, and good performance in the rest of Asia and South America,” he added.
TheCattleSite News Desk