The highest average whole milk powder prices for two years in the latest Global Dairy Trade auction have underpinned Fonterra’s latest 50c rise in the milk price forecast.
The October 2 GDT event saw WMP rise by 3% to an average US$3559/tonne, the highest since $3573 posted on October 4, 2022.
However, the WMP market level is still $1000-plus below the recent peak in early 2022, during a season in which a record $9.30/kg milksolids farm gate milk price was paid.
Fonterra’s latest forecast is in the range $8.25 to $9.75, with a midpoint of $9, published on September 25.
For the October milk payment, Fonterra will advance 78% of the mid-point, rising to 80% in November, 82% in December and a steady 85% thereafter.
The current strength of the world dairy commodities market features some of the highest prices ever recorded for fat products, and anhydrous milk fat eased slightly by 0.1% and butter was down 1.4%.
Cheddar was up 3.8%, butter milk powder up 5% and lactose 6.7%.
NZX dairy analyst Rosalind Crickett said despite ample volume, there remains solid demand for WMP overall, particularly in February and March delivery.
Prices in CP4 and CP5 rose by more than 4%.
The overall GDT price index rose by 1.2%, continuing a firming trend since early July.
Powder and fat keep the milk forecast buoyant
