Prices of dairy products fell for the third straight sale on the GlobalDairyTrade platform in a week in which China lowered its target for economic growth and figures confirmed Europe’s economy contracted.
The GDT-TWI Price Index fell 0.9 percent compared to the last sale two weeks ago. The average winning price declined to US$3,576 a metric tonne. The price of whole milk powder fell 0.3 percent to US$3,409.
Prices of commodities fell 1.4 percent overnight, based on the Thomson Reuters/Jefferies CRB Commodity Index and equity markets sank after Europe confirmed its economy shrank 0.3 percent in the fourth quarter.
Growth assets were already under pressure after China lowered its target for gross domestic product to 7.5 percent from 8 percent.
The average winning price for skim milk powder fell 1.9 percent to US$3,194 a metric tonne while anhydrous milk fat rose 3.7 percent to US$3,631 a tonne. Butter milk powder wasn’t offered at this week’s sale.
Cheddar fell 1.3 percent to US$3,497 a tonne and milk protein concentrate declined 7.6 percent to US$5,131 a tonne. Rennet casein fell 2.5 percent to US$7,519 a tonne.
There were 112 winning bidders over 11 rounds, out of 145 participating bidders. The number of qualified bidders is now 580. The GlobalDairyTrade platform now sells product from Fonterra, plus a number of other international dairy suppliers.
(BusinessDesk)
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Dairy prices fall to 19-month low as output rises
Dairy prices fell to their lowest in 19 months, led by a slump in milk protein concentrate, amid an uptick in supplies from New Zealand, the top exporter, and expectations of strong northern hemisphere output.
GlobalDairyTrade, the auction run by New Zealand-based Fonterra, said that its dairy price index fell by 0.9% to 1,051 at its latest event, on Tuesday, the lowest reading since August 2010.
The decline was led by a 7.6% decline in prices of milk protein concentrate, an ingredient in nutritional drinks, yoghurts and infant formula, besides being prized as a food stabilizer, for its ability to hold together oil-soluble and water-soluble products.
However, prices for milk powder fell too, as did those of cheddar, which has been relatively resilient to the market's latest leg down from an early-December high.
Rising production
The price falls follow Fonterra's decision to scale back plans for cutting volumes for sale at the latest auction, compared with the last event, and to increase by 2.9% its forecast for product to be sold at globalDairyTrade over the next 12 months.
"Ongoing strong milk flows across New Zealand are likely to be reason for the increased volumes of product on offer," analysts at New Zealand-based analysis group Agrifax said.
New Zealand milk output – which, at 942.2m kg of milk solids, grew 10% year on year in the last half of 2011 - has been supported both by increasing numbers of farms being converted to dairy and by good pasture conditions.
Dairy prices fall to 19-month low as output risesDairy prices fell to their lowest in 19 months, led by a slump in milk protein concentrate, amid an uptick in supplies from New Zealand, the top exporter, and expectations of strong northern hemisphere output.
GlobalDairyTrade, the auction run by New Zealand-based Fonterra, said that its dairy price index fell by 0.9% to 1,051 at its latest event, on Tuesday, the lowest reading since August 2010.
The decline was led by a 7.6% decline in prices of milk protein concentrate, an ingredient in nutritional drinks, yoghurts and infant formula, besides being prized as a food stabilizer, for its ability to hold together oil-soluble and water-soluble products.
However, prices for milk powder fell too, as did those of cheddar, which has been relatively resilient to the market's latest leg down from an early-December high.
Rising production
The price falls follow Fonterra's decision to scale back plans for cutting volumes for sale at the latest auction, compared with the last event, and to increase by 2.9% its forecast for product to be sold at globalDairyTrade over the next 12 months.
"Ongoing strong milk flows across New Zealand are likely to be reason for the increased volumes of product on offer," analysts at New Zealand-based analysis group Agrifax said.
New Zealand milk output – which, at 942.2m kg of milk solids, grew 10% year on year in the last half of 2011 - has been supported both by increasing numbers of farms being converted to dairy and by good pasture conditions.
http://www.agrimoney.com/news/dairy-prices-fall-to-19-month-low-as-outp…
Ekosem-Agrar fuels investment wave in Russia dairy
Ekosem-Agrar unveiled a E50m bond issue to raise funds for doubling its Russian milking herd, and expanding its 160,000-hectare landbank, extending the wave of investment heading into the country's fast-growing dairy market.
German-based Ekosem-Agrar, which operates in Russia through its Ekoniva Group subsidiary, said the bonds will carry an interest rate of 8.75%, with a term of five years, and were being targeted at retail investors, as well as institutional investors and fund managers.
http://www.agrimoney.com/news/ekosem-agrar-fuels-investment-wave-in-rus…
We just need to know if every 50 cow dairy herd in Russia is going to increase herd size by 10 cows, thats where the real growth in production will come from
"More attention should be paid to the development of meat and milk production," Mr Medvedev said. "It is necessary not only to create agricultural holdings, but also stimulate the creation of small processing facilities."
http://www.telegraph.co.uk/sponsored/russianow/business/8102236/Russia-…
Free Trade Agreement with Korea-US starts March 15. EU and US will have preferential access into Korean market. It will be interesting to see what effects that has on NZ dairy exports.
Global dairy production growth is said to be around 2.4% and global dairy consumption increase is said to be around 2.2%. Chinese buyers are usually almost out of the market - from Chinese New Year until around Sept/Oct when they come back in again.
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