Solid rise in world dairy prices boosts farmer confidence

Fortunes appear to be turning for dairy farmers as global dairy prices rose for the third consecutive auction overnight. By GERARD HUTCHING
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The global dairy trade index was up 7.7 per cent, with an average price of US$2920 (NZ$3939) per metric tonne.
Even more significant is that the price of whole milk powder (WMP), which determines the Fonterra farmgate payout, has soared by 32.5 per cent over the past three auctions. At this latest auction New Zealand’s major export rose 3.7 per cent to an average price of US$2793 per tonne.
This followed a «stunning» 12.7 per cent rise in overall dairy prices in the August auction and a 6.6 per cent lift the month before that.
Federated Farmers dairy chairman Andrew Hoggard said he was holding off declaring conditions had recovered unless prices continued to hold towards Christmas.
«It’s increased the confidence and gives substance to the lift in the Fonterra payout. It’s a solid rise,» he said.
In late August Fonterra raised its forecast by 50c to $4.75 a kilogram of milksolids, and other processors have followed suit.
Nationally, that increase meant just under $1 billion would be added to the economy and an extra $70,601 for the average farmer milking 419 cows at 377kg MS.
Rabobank economist Emma Higgins said the bank’s analysts in China had noted increased demand from Chinese buyers. One of the factors pushing them towards New Zealand product was the very hot weather in northern China which had put a brake on local production.
«This is fantastic news for the start of spring and is showing the recovery has got legs,» Higgins said.
Westpac’s economics team said improved demand coincided with lower milk supply in key global exporters.
Local milk production will depend largely on weather and pasture conditions over spring and summer.
The bank forecasts a farm gate milk price of $5 this season.
Federated Farmers dairy chairman Andrew Hoggard said after the previous auction that rises towards the US$3000 mark would definitively signal a higher payout for farmers.
Analyst firm AgriHQ said it may be a bit early to say that dairy commodity prices were recovering, but fundamentals pointed to a continued improvement in the sector.
Milkfats stole the show this time, with the price of anhydrous milkfat increasing by 15.4 per cent and butter lifting 14.9 per cent.
Skim milk powder rose 10 per cent to US$2224.
There were 36,748 tonnes of product sold – 199 bidders participated, with 131 bidders winning their bid.
Source: Stuff
Link: http://www.stuff.co.nz/business/farming/dairy/83955556/world-dairy-prices-continue-to-climb-in-globaldairytrade-auction

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Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

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