Another positive Global Dairy Trade event

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A positive result from last night's Global Dairy Trade Auction was "nice to wake up to" says Fonterra's managing director for co-operative affairs, Mike Cronin.

The GDT price index rose 1.9 per cent compared to the previous sale on June 2.

"We call that a strong result. This is our last [auction] for our financial year 2020 delivery," Cronin told the Country's Jamie Mackay.

"I guess we're showing that demand for dairy's pretty resilient at the moment. We're certainly in a period where prices are stable [but] the trick question is how long is that going to last."

Whole milk powder prices, which have the greatest bearing on Fonterra's farmgate milk price, were up 2.2 per cent to US$2829/tonne.

Skim milk powder - the second biggest "reference" product for Fonterra, was up 3.1 per cent to an average US$2609 /tonne.

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Results for other main commodity groups were a rise of 0.8 per cent to US$3993/tonne for anhydrous milk fat (AMF) and butter, which was down 1.0 per cent to US$3597/tonne.

"What we're seeing is the Chinese buyers are in there, which is really good, but also Southeast Asia, which was bullish against expectations - even the Pollyanna ones - so that's good to see," said Cronin.

The last three auctions have been positive, despite "a lot of noise around Covid" which indicated that dairy was "the right place to be" in the medium to long term, even if the route to recovery was uncertain, said Cronin.

Also in today's interview: He also discussed last minute changes to volumes on offer and a new Greenpeace report that slammed Fonterra's emissions.