The recent rally in the GDT came to a halt this week after the benchmark dairy index returned a 0.5% decline in the average selling price of dairy products.

The first negative GDT result of 2018 was a result of weaker sentiment for skimmed milk powder (SMP), as prices fell 3% this week to just over $1,800/t (€1,480/t).

In contrast, whole milk powder (WMP) prices held steady (+0.3%) this week at just under $3,250/t (€2,630/t). On the fats side, butter prices increased just over 1% at this week’s auction to $5,330/t (€4,320/t), while the price of anhydrous milk fat fell by 2%.

Cheddar prices at this week’s GDT fell slightly (-1.3%) to just below $3,700/t (€3,000/t), while casein prices were up by less than 1%. Just over 20,000t of product was sold at this week’s auction in New Zealand.

Despite the flat performance of the GDT, dairy markets remain in healthy order this week.

In Europe, butter prices are rising strongly in recent days. Spot prices for butter reported to the Dutch Dairy Board have jumped 12% in the last week to €4,850/t, suggesting supply tightness remains an issue.

The longer-term price outlook for butter remains firm, with futures prices for butter out to June 2018 rising to highs of €5,200/t this week.

Spot cheddar prices in Europe are also steady €3,000/t this week. On the powder side, WMP prices in Europe increased 1% this week to €2,620/t, while SMP prices remain on the floor at €1,350/t.