Dairy product prices declined at the Global Dairy Trade auction, led by a larger-than-expected drop in whole milk powder, after Fonterra said an increase in its May production lifted its expectations for the season's milk collections.
The GDT price index fell 5.0 per cent from the previous auction two weeks ago. The average price was US$3,232 a tonne. Some 26,519 tonnes of product was sold, up from 21,634 tonnes two weeks ago.
Whole milk powder sank 7.3 per cent to US$2,905 a tonne.
Fonterra released its May Global Dairy Update yesterday, indicating its May production was up 6.6 per cent and that it expects to collect 1.3 per cent more milk in the 2018-19 season, AgriHQ dairy analyst Amy Castleton said in a note today.
"This appears to have given the market the jitters, especially for whole milk powder," Castleton said.