Dairy product prices inch higher as milk fats gain while milk powders fall

Whole milk powder declined 1.6 per cent to US$3,100 a tonne. Photo / Bloomberg

Dairy product prices edged higher at the Global Dairy Trade auction, rising for the second time in six auctions, as gains in milk fats offset a decline in milk powders.

The GDT price index rose 0.3 per cent from the previous auction three weeks ago to US$3,323. Some 33,501 tonnes of product was sold, up from 32,260 tonnes at the previous auction.

Whole milk powder declined 1.6 per cent to US$3,100 a tonne.

Whole milk powder "offer volumes are set to increase over the next few events, so buyers are unlikely to feel an urgent need to buy product now," AgriHQ dairy analyst Susan Kilsby said in a note.

Lactose rose 5.1 per cent to US$791 a tonne, while butter climbed 3.8 per cent to US$5,954 a tonne, and anhydrous milk fat gained 3.6 per cent to US$6,402 a tonne.

Cheddar increased 2.5 per cent to US$4,118 a tonne and rennet casein added 1.2 per cent to US$6,316 a tonne.

Bucking the trend, butter milk powder dropped 10.1 per cent to US$2,026 a tonne, while skim milk powder fell 1.2 per cent to US$1,944 a tonne.

"The dairy commodity market remains focused on the volume of skim milk powder that is in public storage in Europe," Kilsby noted. "Product has started to flow back into the intervention scheme before it closes at the end of the month."

The New Zealand dollar last traded at 72.56 US cents at 11.46am in New York, compared with 71.62 US cents at 5pm in Wellington the previous day.

There were 140 winning bidders out of 173 participating at the 15-round auction. The number of qualified bidders rose to 537, up from 522 at the previous auction.