Global Dairy Prices Continue to Decline, Butter Falls 12.4%
The Global Dairy Trade (GDT) auction held recently reported a 4.3% decrease in average dairy product prices, continuing a downward trend that has persisted for eight consecutive auctions. This decline follows a previous 3% fall just two weeks earlier. The auction, which is an important indicator for global dairy pricing, showed that supply continues to outweigh demand.
Whole milk powder, a key determinant of Fonterra's farmgate milk price, decreased by 2.4% to an average price of US$3364 per metric ton. Skim milk powder, another significant product for Fonterra, fell by 1.6%, reaching an average of US$2498 per metric ton.
Among the dairy products, butter experienced the most significant price drop, plunging 12.4% to an average of US$5169 per metric ton. Anhydrous milk fat also saw a considerable decrease, falling by 9.8% to US$5902 per metric ton, while mozzarella prices slipped by 1.0% to US$3182 per metric ton.
Conversely, some products saw price increases. Butter milk powder rose by 1.8% to US$2903 per metric ton, and lactose prices increased by 4.2% to US$1250 per metric ton. Cheddar recorded the largest price rise, jumping 7.2% to US$4639 per metric ton.
The auction involved 117 successful bidders purchasing a total of 34,282 metric tons of dairy products. In light of these trends, Fonterra recently adjusted its farmgate milk price forecast for the 2025/26 season to a range of $9.00 to $10.00 per kgMS, indicating shifts in global dairy supply dynamics.
