This week’s event outcome looks quite similar to the previous with weak demand across commodities to again deliver the expected moderate losses across milk powders as had been anticipated in SGX futures. This time butter demand was also weak, and it took the biggest hit of all commodities, easing some of the hefty discount to AMF. The index lost another 5% and is back to where it was last August.

SMP fell 5% or US$185 on average to US$3,524/t. Fonterra MH C2 dropped US$205/t to US$3,520/t, with a flat forward curve. The difference in NZ and EU SMP MH prices narrowed again to just US$28/t. WMP dropped 5.7% or US$213/t on average to US$3,544/t. Fonterra Regular C2 lost US$215/t to match the MH SMP price at US$3,520/t.

Butterfat prices continued to spiral on poor demand, with butter taking the biggest hit this time, reducing the discount for AMF. Butter lost 6.1% or US$336/t on average to US$5,194/t, with consistent falls across contracts but left the forward curve slightly weaker. C2 lost US$316/t to US$5,210/t. AMF had a small loss, falling 1.1% on average or US$62/t to US$5,518/t with a larger loss in C1, but that contract remained an outlier. C2 lost just US$40/t to US$5,513/t.

Cheddar prices posted another small change to fall on average by US$27/t to US$4,798/t. NZ young cheddar C2 rose US$35/t to US$4,820/t, but C4 closed at US$4,710/t.