Prices increased 4.5% at today’s Global Dairy Trade event, with all dairy products registering increases in average prices.
This latest increase comes after a bumper increase of 11.4% in prices earlier this month.
Butter milk powder (BMP) prices increased 13.3%, while the cheddar index saw an increase of 11%. Skimmed milk powder (SMP) was another key driver of the increase this week, with prices up 9.8%.
Meanwhile, despite the futures market pointing to a 5% to 7% increase in whole milk powder (WMP) prices, they increased by 3.2%.
Key Results
- AMF index up 4.4%, average price US$5,348/MT.
- Butter index up 1.1%, average price US$4,193/MT.
- BMP index up 13.3%, average price US$2,623/MT.
- Ched index up 11.0%, average price US$3,697/MT.
- LAC index up 4.6%, average price US$787/MT.
- RenCas index up 0.6%, average price US$6,040/MT.
- SMP index up 9.8%, average price US$2,562/MT.
- WMP index up 3.2%, average price US$3,423/MT.
Speaking to Agriland this week, Senior Analyst at AHDB, Luke Crossman said that international pressure on dairy markets remains relatively strong.
“We have seen EU markets level off since the end of October, but that may just be a blip. Global milk output continues to fall.”
The Global Dairy Trade is the main global indicator of market sentiment at this time of the year, Crossman said.
“This is because we are entering a period of the year when dairy output from New Zealand significantly out performs the EU.”
Meanwhile, the Ornua Purchase Price Index (PPI), the monthly indicator of market returns on dairy products sold by Ornua, increased for a fourth consecutive time last week.
The October the PPI increased to 95.9 points, which is the equivalent of 27.9c/L VAT inclusive, based on Ornua’s product purchase mix and assumed costs of 6.5p/L.
This latest increase reflects higher returns in the month across all main products, according to Ornua.
Compared to the September PPI, the October returns rose by 3.7 points. The PPI has steadily been rising since July, which was the first time it rose in 16 months.
