GDT drops 6%

GlobalDairyTrade’s price index took another fall in this morning’s auction:

gdt30914

 

gdt3.914

One of our staff is Dutch and keeps up with news from home on the internet.

He said the Russian boycott of produce was causing a glut of vegetables in Holland. It will also be one of the factors impacting on dairy prices.

Meanwhile Russia will have to spend billions subsidising its farmers.

Russia’s agriculture minister has warned that Moscow must spend billions of dollars in the coming years subsidising farmers in order to avoid a shortage caused by its ban on most Western foods.

Agriculture Minister Nokolai Fyodorov’s stark comments on Wednesday (local time) represented Moscow’s first admission that its decision to strike back at US and EU sanctions with sweeping food bans, including those against Australia, may have long-term costs for both its budget and consumers.

The trade war is part of a broader crisis in East-West relations sparked by Russia’s perceived attempts to split strife-torn Ukraine in two after Kiev’s decision to seek a closer political and economic alliance with Europe.

Russia relies heavily on foreign fruits and vegetables because its long winters and inhospitable climate keep farmers from growing produce desired by the country’s booming middle class.

It also imports huge volumes of Australian and European meat along with US poultry and Norwegian salmon – all banned under Russian President Vladimir Putin’s orders earlier this month. . .

Russia isn’t boycotting our produce but goods not allowed into Russia will be competing with ours elsewhere.

4 Responses to GDT drops 6%

  1. Andrei says:

    “A lie gets half way round the world while the truth is still putting its boots on” – Mark Twain

    This is really what all this “the Russians are coming, the Russians are coming” nonsense is all about

    Power of Siberia

    The center of gravity for trade and commerce is moving from Wall Street to Eurasia and the American elites don’t like it.

    That’s why we saw this on yesterday’s “Rural Roundup” post

    Fonterra’s credit rating has taken a hit following the announcement of its proposed partnership with a Chinese infant food manufacturer.

    Credit rating agency Standard and Poor’s has lowered the dairy co-operative’s long-term rating from A+ to A and affirmed its short-term rating of A-1.

    This is displeasure being shown to an NZ company for investing in China and has nothing to do with real creditworthiness.

    But all of that is trivial compared to the suffering of the people of Ukraine which is being destroyed in order to throw a spanner in the works of the free flow of goods across the Eurasian continent.

    I still think we are probably in for WW3

    Like

  2. murray grimwood says:

    For perhaps the first time ever, I agree. This posturing is over energy. Oddly enough, most folk don’t understand that, even though they all know that if they don’t repeatedly fill their tanks, they roll to a halt (Try pushing your 4wd home, uphill, to see how much fossil fuels do for you).

    In the real world, money doesn’t count. Energy – to do work – does, and we are down to ‘who gets the last half’. It’s a game where the losers – of a species perhaps overshot x3 – will die.

    This current stoush is over the same Caucasus/Middle East that Hitler attempted to annex, Putin will know this, and will know that Russia has to lose. He’s on top of too much of the remaining energy, Europe depends on it, and the West is down to fracking/tar-sands/deepwater – read: dregs.

    WW3 is indeed inevitable, sans pandemic. But there are those who still think ‘economic growth’ is worth pursuing. Go figure

    Like

  3. Andrei says:

    But there are those who still think ‘economic growth’ is worth pursuing. Go figure

    The only reason I maintain my eyesight Murray, is that I live in a wealthy developed country that can afford to invest in a health system that can perform the expensive procedures necessary to save it. For this I am grateful

    If I was of the hoi polloi in most of the other nations of the world I would now be blind.

    “‘economic growth’ is worth pursuing”? Yes it is.

    And Russia wont loose, it holds all the cards and what is happening today is just a replay of 1242, 1612, 1812, 1941 and the outcome, after much death and suffering along the way has been the same each time.

    We need free trade to raise the standard of living for all and the ability of one nation to dictate to others by imposing “sanctions” on those with whom it disagrees (ie wont hand over the control of their strategic resources to Wall Street) is a problem in achieving this.

    Like

  4. Andrei says:

    Another escalation – these people are certifiably insane.

    How many people are they prepared to kill in their quest to prevent the re-opening of the silk road?

    Like

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