The GDT index, a benchmark indicator for global dairy prices, has been on something of a bull run for the past number of months.
Since mid-November, it has recorded six consecutive positive results, as average dairy prices continue to rise.
At this week’s auction in New Zealand, the index increased by a further 1.8% to its highest level since May 2014.
This week’s auction was led higher by strong demand for butter and whole milk powder (WMP). New Zealand butter prices shot up by another 6% this week to break the $5,000/t mark (€4,190). New Zealand butter now has a near-€700/t premium over European butter prices.
The average price of WMP increased by 2% this week to hit $3,460/t (€2,880/t), which is the highest price level for New Zealand WMP since 2016.
Cheddar prices increased 2% this week to $4,180/t (€3,480/t), while the price of skimmed milk powder (SMP) fell by 1.5% to $3,200/t (€2,665/t).
On the back of this latest result, New Zealand dairy giant Fonterra increased its milk price forecast for the 2020/21 milking season to a higher range of $6.90 to $7.50/kg of milk solids, which equates to a range of 31c to 33.6c/litre in Irish milk price terms.
Closer to home, European butter prices increased to €3,500/t this week, while cheddar prices were steady at €3,250/t.
Milk powder prices are generally steady. Dutch dairy giant Friesland Campina has lifted its guaranteed milk price for February by almost 1c to an equivalent of 35c/litre.