The dairy market took a hit this week as both the GDT and Dutch auctions saw milk powder and butter prices fall.

The GDT auction was down 2.4% to US €3,223/t, which converts to a farmgate price of 32.3p/l before applying processing costs.

With milk production in New Zealand approaching its annual peak, auction prices were subdued as buyers were more cautious.

Butter was down 3.6% to US $5,837/t.

Whole milk powder (WMP) fell 2.7% with skim milk powder (SMP) down 1.4%.

On Wednesday, Dutch dairy markets saw butter prices fall for the first time since February. Prices now stand at €6,690/t. SMP fell to €1,610/t while WMP was down €30/t to €2,960/t.

Despite these slight falls, all indications are that markets remain solid and, locally, farm prices will stay strong into the new year.