A drop in the price of whole milk powder pulled down prices at last night’s Fonterra dairy commodity auction.
The GlobalDairyTrade’s trade-weighted price index overnight dropped 1.9 per cent compared with the last sale two weeks ago.
The average winning price was down to US$4888 (NZ$5844) a tonne from US$4980 a tonne.
Maximum supply, the measure of how much product Fonterra has for sale, fell from 47,066 tonnes to 45,556 tonnes, with a total of 43,261 sold.
Whole milk powder, the largest category by volume, fell 2.9 per cent.
New Zealand dairy commodity prices are still more than 50 per cent higher than they were a year ago.
Westpac market strategist Imre Speizer said the fall of the whole milk powder made a difference as it was the most significant category traded.
A fall off in prices for one auction was nothing to be worried about, he said.
It was hard to determine the reasons for movement in a single auction.
However, if there was a further decline in prices in the next two or three auctions that could signal an end to the dairy rally, he said.
Sustained price drops could mean a drop in Chinese demand or a lift in global supply, Speizer said.
The drop in prices at last night’s auction had not had a lasting effect on the New Zealand dollar.
In the latest auction, five of the nine product categories fell, one was not traded.
Butter milk powder led the decliners down 5.2 per cent, with butter falling 3.5 per cent.
Milk protein concentrate and rennet casein rose 1.7 per cent and 1.5 per cent respectively.
In last night’s auction 170 bidders took part, with 114 winning bidders, and 888 qualified to bid.A drop in the price of whole milk powder pulled down prices at last night’s Fonterra dairy commodity auction.
The GlobalDairyTrade’s trade-weighted price index overnight dropped 1.9 per cent compared with the last sale two weeks ago.
The average winning price was down to US$4888 (NZ$5844) a tonne from US$4980 a tonne.
Maximum supply, the measure of how much product Fonterra has for sale, fell from 47,066 tonnes to 45,556 tonnes, with a total of 43,261 sold.
Whole milk powder, the largest category by volume, fell 2.9 per cent.
New Zealand dairy commodity prices are still more than 50 per cent higher than they were a year ago.
Westpac market strategist Imre Speizer said the fall of the whole milk powder made a difference as it was the most significant category traded.
A fall off in prices for one auction was nothing to be worried about, he said.
It was hard to determine the reasons for movement in a single auction.
However, if there was a further decline in prices in the next two or three auctions that could signal an end to the dairy rally, he said.
Sustained price drops could mean a drop in Chinese demand or a lift in global supply, Speizer said.
The drop in prices at last night’s auction had not had a lasting effect on the New Zealand dollar.
In the latest auction, five of the nine product categories fell, one was not traded.
Butter milk powder led the decliners down 5.2 per cent, with butter falling 3.5 per cent.
Milk protein concentrate and rennet casein rose 1.7 per cent and 1.5 per cent respectively.
In last night’s auction 170 bidders took part, with 114 winning bidders, and 888 qualified to bid.
Source: Stuff