The GDT index fell by 1.4% at Tuesday’s auction in New Zealand. Perhaps indicative of the uncertainty and volatility in global dairy markets at present, the GDT index recorded a negative result despite many market analysts forecasting as much as a 2% lift.

In the lead up to this auction, futures contracts for whole milk powder (WMP) traded in New Zealand had risen by 8% in price over the last fortnight, pointing towards a positive result in the GDT. WMP is the key commodity traded on the GDT, accounting for more than half of product sold.

And while the WMP average selling price did lift by 0.7% close to $2,180/t, it was not enough to help lift the GDT index for its third consecutive auction. Instead, declines in the average selling price of butter (-5.5%), butter milk powder (-5.5%) and skimmed milk powder (-3.6%) combined to drag the benchmark dairy index lower.

Other drops

There were also drops in the average price of lactose (-2.7%) and anhydrous milk fat (-1.6%). Casein prices improved by 3.5%, while cheddar values were up by 1.8%.

The volume of product sold at Tuesday’s GDT remains low with just over 20,600t sold via the auction platform – significantly down on the 27,370t sold this time last year and the 38,174t sold in early May 2014.