Dairy futures points to a possible rise in prices for tomorrow’s Global Dairy Trade
Ahead of tomorrow’s Global Dairy Trade auction, New Zealand bank ASB has suggested that skimmed milk powder (SMP) will pace overall dairy prices by approximately 4-6%.
In its latest dairy futures outlook it expects whole milk powder (WMP) prices to be up by 2-4% at the auction.
Last week, WMP prices remained depressed with prices down between 1-3% since following the last auction on May 3.
Dairy product prices fell 1.4% at the latest Global Dairy Trade auction which took place on May 3. At the auction previous, on April 19, prices rose 3.8% with whole milk powder (WMP) rising 7.5%.
At the latest auction, only three products posted increases in prices – cheddar (+1.8%), rennet casein (+3.5%) and whole milk powder (+0.7%).
The butter index was down 5.5% as was the butter milk powder index by the same percentage. The skimmed milk powder index was down 3.6%.
ASB bank had suggested that the auction could post a rise and hinted that whole milk powder (WMP) could rise between 3-5%, however this was not the case following the Global Dairy Trade auction.
Global Milk Production Up 3.4% In January-February
With dairy prices remaining low, global milk production continues to increase with a 3.4% increase in January-February 2016, mainly due to strong production growth in the EU, according to the Milk Market Observatory’s (MMO) Economic Board.
EU milk collection was up by 5.2% in January-February, with percentage increases particularly strong in Ireland, Northern Ireland, Luxemburg and Belgium.
There was a 1.8% increase in US milk production in March, which was higher than expected, in light of the US Department of Agriculture (USDA) growth forecast for 2016 of 1.5%.
New Zealand production was also higher than expected in February (up 2%), but it is expected to end up slightly down for the season.