Whopping Surprise 21% Lift in GDT WMP Auction Price

Yesterday’s fortnightly GDT auction recorded an unbelievable result with WMP up 21% in only two weeks and the overall all products average up 15%.

This was the 8th consecutive auction rise and recorded a 7-year high averaging US $ 4231 tonne.
The surge in demand is Chinese driven as the Chinese government continue to push to hold higher quantity of food stocks.

Farmgate milk prices in China are at all-time record highs and its now looking likely that the 12-month Fonterra New Zealand farm gate milk price will top trump and eclipse the average price paid in the UK according to DEFRA statistics which would be a first and lead to much head scratching.

Note this surge comes at the end of the New Zealand Dairy season as they head into their low milk producing months, and whilst their milk pay-out price will receive a boost, the main beneficiaries are likely to be European dairy traders as we enter our peak production months. It’s all good news unless you are supplying a liquid processor or milk broker who has had to drop its milk price recently or hasn’t even declared what they will pay you for last month’s milk.

The boost in dairy product demand and prices in China is not limited to dairy because mutton prices in China are reported to be level pegging with lamb prices.

Notable price movements were:

WMP up 21% to average US $ 4364 tonne

Butter up 13.7% to average US $ 5826 tonne

SMP up 3.5% to average US $ 3302 tonne

Cheddar up 1.3% to average US $4280 tonne