Global Dairy Trade shows drop of 3.6%

At the latest Global Dairy Trade event, the overall price index fell by 3.6%, on the back of milk powder prices declining, according to Patty Clayton, dairy analyst for the UK’s AHDB. This was the sixth consecutive drop in prices at the auction, but the overall average remains 23% up on the same time last year, she notes.

High prices and growing milk supplies from New Zealand (NZ) and the US in particular, are likely to be driving down prices, she says. Current forecasts see strong growth continuing in both regions, leading to higher exports, and the potential for further pressure on commodity pricing.

Demand from China has been strong, and has underpinned the earlier price increases, Clayton adds. These high prices may be curbing demand from more price-sensitive markets, but it will be import demand levels from China, which will remain the main driver of dairy commodity pricing through the second half of this year. For further information visit ahdb.org.uk/news

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