Latest dairy auction results rise 7.8% from previous event, up 11.8% in the past month

Latest dairy auction results rise 7.8% from previous event, up 11.8% in the past month

In contrast to most other major dairy markets, New Zealand pasture growth is reported to be very good leading up to the new dairy season.

But weather and growing-condition challenges faced by other major dairy producers is starting to worry buyers and the latest globaldairytrade auction results reflect that concern.

The US drought is providing a further setback in destroying pasture, while in Europe, a mixture of weather extremes "is pushing milk production lower at a higher-than-normal rate", Rabobank said.

Weather forecasters say there are clear signs El Nino is developing. This poses a threat of drier condition in eastern Australia, areas of significant dairy production.

Auction prices rose strongly, at about their fastest pace in US$ over the past two years, climbing 7.8% from the previous auction two weeks ago, and rising almost 12% from a month ago.

The up-trend was led by milk protein, which soared 15.4% in value to an average of US$5,351 per tonne, although prices rose in all seven products traded.

The rise for whole milk powder lagged other products, rising 7.0% from the previous auction two weeks ago. Skim milk powder was up 7.3%.

The recovery in anhydrous milk fat prices has been spectacular since its recent low point in mid-May 2012 - the product has gained 27% in the past three months.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

4 Comments

This probably gets us to the $5.50 - that otherwise was looking a big ask.....
 
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=1082...
Williams said today's auction result would go some way towards reassuring farmers that Fonterra will reach its forecast farmgate milk payout of $5.50 per kg for the 2012-13 season.
"They will be more comfortable, but the New Zealand dollar will remain quite a big bug bear in terms of reaching the $5.50 payout that Fonterra came out with in May," Williams told APNZ.
 
http://www.stuff.co.nz/business/farming/7488800/Fonterra-auction-prices-...
"This is an important result to keep current dairy payout forecasts on track when the risk of a downward revision had been starting to build," Martin said.
 

Not to mention the fact that it looks like we will get another month of record rainfall - thats on top of the huge (225mm/month) rainfall we had in June July.
The North is completely water logged as are most parts of the Waikato. 
I agree re Downer Cows (milk fever) has been slightly higher than normal and cows are calving 7-15 days early. I hear theres been alot of abortions happening?
Please Mr Hickey can we have lots of sun and abit of wind next week................... and a lower dollar would be nice...............

Mist/Grumpy - Our fat/protein ratios are quite different this year, anyone else finding that?
I'm hearing of quite a few slips/early calves down around us too Grumpy.
In the last 3 weeks the MOTH has driven from Auckland to Invercargill and he said the only real grass is from Otago south.  So you do have to wonder where the press bunnies get their info from.
Have to say that in Southern Southland we have had one of the driest winters (i.e. no real mud) for years.  It's been great - grass is good and we have even been able to get on to the crop paddocks to rip/aerate, something we haven't been able to do before.  It seems when it is wet up north we get the sun down south.
Ken Ring predicted August to be the wettest month of the year for the North Island and October the 2nd wettest. Will be interesting to see if he is right. 
 

Weve dropped the bought in feed this season and lowered stocking rate so now all grass except for a 1000ton of maize as a backup should the gods not bring us rain in the summer.
Feed prices are to high v's payout and show no sign of dropping, high input farming is as risky as trading FX (specially when Fonterra's payout expectations are so far out of wack!?!?!?!).
$NZ safe haven attraction and NZ Gov. borrowing heavily all putting upward pressure on the Kiwi which isnt good.
We r up 10-15% on last season, slight Milk Fever cause cows are to fat..........
Growing 35kgDM/day + at mo, problem is utilisation as it rains everyday.
I hope your man Kens wrong!!!