After going backwards in March, the Global Dairy Trade market has recovered its momentum, with the 2024 New Zealand dairy season likely to end on a high note.
In the latest auction, whole milk powder rose 2.4% and cheddar 6%, contributing to the GDT index rise of 1.8%.
Anhydrous milk fat prices are now the highest in the 15-year history of the GDT, reaching $US7124/tonne.
They have increased by 60% over the past year.
At a whisker under $6600, butter prices are also close to the record $7000 reached in mid-2022.
In the past six months the GDT price index has risen 12%, overcoming that 5% fall in March.
Over the whole season the market movement for reference products has been positive by 10%, which reinforces the current farmgate milk price predictions of $8/kg milksolids.
While that is not the $9-plus payouts of the 2023 season, it is nonetheless a good, welcome outcome to an up-and-down 12 months.
The Fonterra forecast opened last May at $8 mid-point and dropped to $6.75 in late August after WMP prices dropped 10% in one auction.
A not-so-steady recovery since then has seen the GDT index rise a total of 30% from the trough until now, near the end of the season.
The latest confidence in the market won’t do much to influence the milk price in the season just ending, but it will inject confidence into the first 2025 forecast, due out at the end of May.
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