The trade weighted price dropped 5.1% at this morning’s GlobalDairyTrade auction.
Prices were: Whole milk powder down 4% to $3,475/MT; skim milk powder down 5.2% to $3,488/MT; anhydrous milk fat down 12.5% to $4,614/MT; butter milk powder up 0.3% to $3345; rennet casein down 1.4% to $9,992/MT; milk protein concentrate down 10.2% to $5,525/MT.
Cheese which sold on this platform for the first time went for $4,315/MT.
This is the third auction in a row in which the TWI has dropped suggesting the steam is going out of dairy prices. Prices are now at a similar level to this time last year and still above the long term average.
In a newsletter to shareholders Fonterra chair Sir Henry van der Heyden says the company has signed an agreement with the government of Yutian County to develop 3rd China farm.
This is expected to increase Fonterra’s production in there to around 90 million litres. They’re on track to start milking on a 3,200 cow farm in November.
The next step in the company’s strategy is to build high-quality fresh milk supply for Chinese customers.