World Dairy Markets Shoot Up 8.3 Percent
World dairy markets took a cue from U.S. dairy markets, shooting up 8.3 percent in the aggregate on the Global Dairy Trade (GDT) auction in New Zealand today. Trading volume was moderate, with nearly 26,000 metric tons of product finding new owners.
Whole milk powder led all commodity, skyrocketing 14 percent to $1.46/lb. Skim milk powder was up 3.5 percent to $1.22. Cheddar cheese increased 3.3 percent to $1.71/lb, and butter was up 3 percent to $1.69/lb.
Even with these increases, however, U.S. skim milk powder remains the only highly competitive product on world markets. U.S. butter is now about on par with world prices, and U.S. cheese prices are still trading $1/lb above world prices. The gap for whole milk powder, while closing, remains at 20₵ to 35₵/lb with U.S. whole milk powder still trading at $1.65 to $1.80/lb.
While U.S. exports are running at 2-year high levels, high U.S. dairy prices could prove problematic the second half of the year.
Read all of today’s GDT results here.