The Global Dairy Trade (GDT) Events Oversight Board has approved two rule changes to encourage a wider range of sellers to offer dairy ingredients on the auction platform.
The stated goal to expand the breadth of regional published prices is also behind these modifications, according to the firm.
Auckland-based GDT maintains a global online market for dairy produce, with auctions taking place every two weeks throughout the year.
It provides a fortnightly price index for dairy products on the global market, offering a milk price indicator for processors and suppliers alike.
The approved changes will enable sellers to join the platform, while retaining a level of privacy over their commercially-sensitive data, the GDT said.
Eric Hansen, director of GDT, said: “The changes represent an important step forward to expand the supply on GDT events by further reducing barriers to entry for sellers.
“The changes received unanimous support from all members of the oversight board, which includes representatives of buyers, sellers and financial market participants.”
Changes
The first change will enable an average winning price to be published as a substitute, or in addition to the publication of each seller’s individual winning prices.
This will enable sellers to join GDT events and have their published winning prices combined with other seller prices within a regional average, rather than necessarily needing to publish each seller’s individual winning price.
However, current sellers Amul, Arla, Arla Foods Ingredients and Fonterra have confirmed that they will continue to publish their individual product winning prices.
The second change closes a loophole where a restricted bidder can still view a product’s offer quantity and starting price in the private log-in section of the information website, despite a seller restricting that bidder from bidding on one or more of its products.
This approach will avoid the potential for bidder confusion and reduce anti-trust risk, as it will prevent a bidder who produces and/or trades the same type of product outside of GDT to access sensitive information.
The change will have no impact on public transparency, as pre-event data is not displayed on the public section of the website, the company assured.
Hansen continued, noting: “Both changes will increase the attractiveness of GDT events to sellers, and thus will enable GDT to bring the benefits of price transparency to a wider range of core dairy ingredients and more supply regions – such as Europe and the US.”
The two changes have been adopted within the updated GDT Trading Event Rules, which can be accessed here.
The full application of these changes will be implemented over the following months as necessary system enhancements are completed.
