Milk prices drop as market remains cautious
The dairy market remains cautious as the global recession continues to weigh on consumer demand, the world’s largest dairy exporter has advised.
The May trading event for Fonterra’s internet-based sales platform, globalDairyTrade, concluded at this morning, with prices mixed within recent trading ranges.
The trading manager, CRA International, advised Fonterra that the average price achieved across all products and contract periods for Whole Milk Powder (WMP) was US$2,144 per tonne FAS New Zealand Port, 4.1 per cent lower than the previous event in April. Prices ranged from US$2,085 per tonne FAS to US$2,220 per tonne FAS. However, prices rose for contracts with short-term delivery by almost 2 per cent.
“Today’s result confirms our expectation that dairy markets will be characterised by increased uncertainty in the future and we expect prices will continue to cycle around current levels,” said Nigel Kuzemko, Director of Portfolio Optimisation at Fonterra Global Trade. “Still, globalDairyTrade continues to achieve its goal of being an accepted reference point for global dairy prices, with last night’s trading event attracting strong international interest and a record number of participants.”
The next globalDairyTrade trading event will be held on 2 June 2009.