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Dairy prices have continued their downward slide in the latest Global Dairy Trade auction, held overnight.
Following on from the previous event two weeks ago, which saw the biggest drop since 2015, the index fell a further 2.9 per cent across the board.
Whole milk powder (WMP) - which has the biggest influence on Fonterra's farmgate milk price - fell 4.9 per cent, on the back of a 6.5 per cent decline in the previous event, to an average US$3934/MT.
Skim milk powder (SMP) - Fonterra's second-biggest reference product - remained more stable with a 0.6 per cent drop to an average US$4116/MT, after also falling 6.5 per cent in the previous event.
SMP remains ahead of WMP in value for the fourth time.
Among the other reference products, butter stabilised somewhat with a 1.0 per cent decline to an average US$5750/MT, following a 12.5 per cent plunge two weeks ago.
Butter has now dropped nearly US$1350/MT, from a record high of US$7048/MT on March 1, 2022.
Cheddar also found firmer ground, with a 0.1 per cent dip to an average US$5635/MT, after an 8.6 per cent landslide on May 3.
Anhydrous milk fat was the only product to buck the trend with a 0.6 per cent increase to an average US$6043/MT, following a 12.1 per cent drop last time.
Butter milk powder was not offered at this event, and there were no figures available for sweet whey powder or lactose.
24,285 MT of product was purchased by 100 successful bidders - similar to 25,163 MT and 107 winning bids at the previous event.
Last week, Fonterra dropped and narrowed its 2021/22 forecast farmgate milk price range to between NZ$9.10 - $9.50 per kgMS, from NZ$9.30 - $9.90 per kgMS.
This decreased the midpoint of the range, which farmers are paid off, by 30 cents to $9.30 per kg, which would still be the highest ever paid.
It was still a good result, despite the dip, Fonterra chief financial officer Marc Rivers said.
This was helped by the performance of whole milk powder, Rivers told The Country's Jamie Mackay.
Of the different types of whole milk powder on the platform, instant whole milk powder had "corrected itself" from a previous high and regular whole milk powder went up 4 per cent, Rivers said.
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"That's actually quite good … I would call it an event where we've seen things stabilise."
As for the opening forecast for the coming season, Rivers said Fonterra was "optimistic" in its medium to long-term outlook.
Dairy demand was still "quite strong" and supply was "very constrained globally", especially in the US and Europe, he said.
The short-term was more problematic, however.
"Covid and China, the Sri Lanka issues, these sorts of things are short-term things that we've got to get through but on the other side of that, I think, is a pretty good picture."
Also in this interview: Rivers responded to Climate Change Minister James Shaw's comment that New Zealand will lose lucrative off-shore buyers if it doesn't lower the carbon footprint of its dairy production.