International milk prices rose at the latest auction, led by gains for cheese and rennet casein, New Zealand’s Fonterra Cooperative Group, the world’s biggest dairy exporter, said on Wednesday.Fonterra’s Global Dairy Trade-Trade Weighted Index, which covers a range of 30 products and contract periods on offer, rose 1.1 percent, with an average selling price of $3,311 per tonne. This followed a 2 percent fall at the previous auction.
Dairy prices, which peaked in October 2007, have gained more than 28 percent since the mid-May, in part because a drought in the United States has dented supply.
At the latest auction, prices for cheddar rose 4.9 percent, rennet casein was up 6.9 percent, with a smaller rise for skim milk powder. There were small falls for whole milk powder, butter milk powder, and anhydrous milk.
Full details of the auction are at www.globaldairytrade.info
Fonterra holds two auctions a month, with results from the next one due on Jan 2.
Last week the cooperative raised its forecast payout for the current season by around 4 percent to NZ$5.90-NZ$6.00 because of an improved price outlook.
Fonterra is owned by about 10,500 farmers and controls nearly a quarter of the world’s dairy exports, generating more than 7 percent of New Zealand’s gross domestic product.
Dairy produce makes up more than a quarter of New Zealand’s NZ$47 billion export earnings, and the currency is often sensitive to movements in prices.
Fonterra has recently set up a Shareholders Fund, a unit trust based on dividends from Fonterra shares, aimed at bolstering its balance sheet so it can fund expansion plans. (Reporting by Gyles Beckford)
Source: Â Reuters
