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Dairy Prices Surge As Production Declines

Wednesday, 4 February 2015 at 11:55am

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Economist predications were correct in saying milk prices would rise in response to reduced dairy production. Fonterra announced last week that the current dry spell has resulted in a decrease in production and milk volume this season, down 3.3% on last season. 

This reduction in supply had positive results in last night’s GlobalDairyTrade (GDT) Auction, which gained 9.4 per cent since the last auction on January 21.  Whole milk powder (WMP) prices jumped by 19.2 per cent to US$2874 a tonne.  This is the fourth consecutive gain since December 2014.

It is expected that milk powder prices will continue to rise over the season.  For more information read this NZ Herald Article “Prices surge 9.4pc at latest dairy auction”.