An average rise of 1.7% in Fonterra’s GlobalDairyTrade (GDT) auction results on Tuesday just about kept global dairy price momentum going.
The average price had risen 7.7%, 12.7%, and 6.6% in the three previous auctions conducted by Fonterra, the giant New Zealand co-op which generates about one third of global dairy exports.
Auction prices on Tuesday rose 3% for skim milk powder, the main commodity influencing the EU market.
The GDT index has reached its highest level since March 2015, but the 1.7% rise was much less than the 6%-12% which futures markets had been signalling.
In Ireland, more co-ops responded this week to stronger global dairy markets by increasing their prices for August milk.
Dairygold Co-op added 1c/l, and Aurivo Co-op and the West Cork co-ops increased August prices by 1.5c/l.
Meanwhile, yesterday was the deadline for farmers in most EU states to apply for payment for each kg of milk by which they will reduce production for October, November, and December.
Several countries have topped up the 14c/kg payment, but improvements in global dairy markets may dissuade farmers from taking part in the reduction scheme.
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