What is being described as the worst drought in 30 years pushed prices to an all-time-high on the Global Dairy Trade auction in New Zealand on April 2nd. The average product price increased 14.2 percent compared to the last sale on March 19th. This is the eighth consecutive increase in the auctionâ€™s average price.The butter price did decline 2.7 percent from two weeks ago, butter milk powder increased 0.8 percent, rennet casein was 4.4 percent higher, cheddar cheese increased 6.6 percent, anhydrous milk fat was 6.7 percent higher, the whole milk powder price was up 7 percent and skim milk powder jumped 27.8 percent from the last auction.
The average winning price is now the highest ever for the platform which began in July of 2008.
Since the January 16th sale, the average product price has increased 45 percent. Whole milk powder is up 55 percent.
Volume on the sale has been declining, 13,912 metric tons were sold on Tuesday, the smallest amount since May of 2011.
The drought has prompted Fonterra to reduce its New Zealand milk production estimate for the year to â€œevenâ€ with last year. Production was running 6 percent ahead of year-ago levels for the first half of the year which ended in January. Estimates put the second half at 15 to 20 percent below last year.