Any doubts about the strength of the dairy market recovery were quashed at this week’s Global Dairy Trade (GDT) auction.

The index increased by an impressive 4.2%, building on the gains made at the last auction three weeks ago which saw the index rise by 2.3%.

The big movers were whole milk powder (WMP), skim milk powder (SMP) and butter, which increased by 3.4%, 4.6% and 10.3% respectively.

The lift in GDT is a real shot in the arm for Irish co-ops which can now point buyers to the consistent GDT rises and secure higher prices as a result.

As reported over the last few weeks, the confidence seen at the GDT has been largely absent from the European market and that hasn’t really changed this week, although the price of WMP has increased.

Butter dropped €65/t to €5,230/t and is now trading at €835/t lower than the GDT price, which is highly unusual. Powders fared a bit better this week, with WMP increasing by €85/t to €3,575/t and SMP falling by €5/t to €2,395/t.

The quantity of product traded at the GDT was significantly lower than normal, with just over 24,000t of product moved, whereas before, that figure would have been well over 30,000t, particularly at this time of year.

Milk production in New Zealand was up 2.5% in December 2023 compared with the same period the year before.

It’s been a good summer for grass growth and milk production in the Waikato region, but it’s dry and harsh in Canterbury, so milk production is expected to tail off there as we head into February.