GDT drops a further 2.9%
Posted on: 23/05/22
Tuesdays GDT Auction results saw the average price of all products fall for the 5th consecutive time to average US $4432 tonne. Note at the last auction average prices fell 8.5%.
The quantity sold at this week’s auction was 24,285 (down 3.5% on the 25,163 sold two weeks ago). In addition, the number of winning bidders fell from 107 to 100 however the number of participating bidders jumped from 132 to 159 which is encouraging.
New Zealand farmers have been informed that the drops should not be of huge concern. Two factors flagged up are the continued lockdown of 20 ports in China including the world’s largest container port – Shanghai which is scheduled to last until June when a gradual easing of Chinas zero tolerance Covid policy will commence. This lockdown has already been in place for more than 2 months.
The other is Fonterra’s exit from Russia including the closure of its Moscow office and the ending of joint ventures with the Russian Dairy businesses.
Fonterra recently slightly reduced its 2021/22 forecast average farmgate payout.
Notable falls were
WMP down 4.9% to average $3934
Butter down 1.0% to average $5750
SMP down 0.6% to average $4116
Cheddar down 0.1% to average $5635
The Market
Spot prices still start with a 4 and the UK is past its peak production daily output and now dropping. Domestic commodity prices for the four GDT products stated above are either holding or in the case of cheddar continuing to climb.