GDT - prices finally on the rise in 2023

File photo / Alan Gibson

In the immortal words of Etta James - “At Last.”

Prices in the latest Global Dairy Trade auction, held overnight, have risen significantly - up 3.2 per cent across the board.

It is the first increase since December 6, with the index falling 2.8 per cent on January 3 and 0.1 per cent on January 17, to kick off 2023 on a sour note for dairy farmers.

Whole milk powder, which peaked in March 2022 at US$4757/MT, rose 3.8 per cent to an average of US$3329/MT – US$111 more than two weeks ago.

Skim milk powder - Fonterra’s second-biggest reference product - remained flat, with an average of US$2829/MT, after a 0.3. per cent drop last time.

All other reference products on offer were up, with the biggest increase coming from butter, which leaped 6.6 per cent to an average US$4745/MT.

Similarly, anhydrous milk fat jumped 4.8 per cent with an average of US$5586/MT, while cheddar rose 2.3 per cent increase, to an average of US$4980/MT.

Butter milk powder, which wasn’t on offer in the previous auction, rounded out the positive clean sweep, with a 2.0 per cent increase to an average of US$2633/MT.

32,582 MT of product was purchased by 116 successful bidders.

In December, Fonterra narrowed and lowered its forecast for 2022/23 - with a farmgate milk price range of $8.50–$9.50 per kgMS and midpoint of $9.00.

In the same update, its forecast 2022/23 normalised earnings guidance was lifted to a range of 50 to 70 cents per share.