Dairy prices slipped for the third consecutive GDT auction - ANZ
Analysts at ANZ explained that the dairy prices slipped for the third consecutive GDT auction overnight, with the GDT-TWI falling 3.5% and WMP dropping 5.5%.
"For the latter, the main weakness was in product for delivery in the early New Year perhaps suggesting that demand for the Chinese free-trade window is now somewhat satisfied. Falls for longer-dated contracts were more modest, although importantly, prices across all contract periods are now below the key US$3,000/tonne level."
"We downgraded our 2017/18 milk price forecast to $6.25-$6.50/kg MS last month, and at face value, today’s result warrants some further caution."
"However, with the NZD/USD down around 4% since the mid-October auction, it shouldn’t be forgotten that there are some other key factors supporting the local farm-gate returns."