Commenting on this week’s GDT auction results, which saw a relatively neutral average price move of -0.6% compared to the last event, IFA National Dairy Committee Chairman Sean O’Leary said that, after a long run of price reductions, whole milk powder and butterfat prices were recovering strongly on the GDT trading platform.
Butter, AMF and WMP account for some of the largest quantities of product traded through GDT, and their prices rose respectively by 4.9%, 3.6% and 3.4% at today’s auction. SMP prices are more disappointing, down 12% on average when compared with the 5th August auction – however, prices for February 2015 deliveries were 10% higher than prices for October 14.
“I know that much has been made of the Russian ban on EU dairy imports, but despite its destabilising potential, buyers in the GDT auction have clearly recognised that dairy prices had hit unsustainable levels, and showed their willingness to pay more for butterfat and WMP,” Sean O’Leary said.
“Product prices have become more affordable, and I expect we will see more interest from international buyers anxious to cover their end of year needs. This may well be the first real sign of markets bottoming out,” he concluded.