GDT horror movie

by | Aug 16, 2023 | GDT, Global

It was a not unexpected horror show that unfolded in this week’s GDT auction #338 as demand from traditional buying regions remained weak in the face of offer volumes that are not only rising seasonally but have boosted by Fonterra in coming months.

WMP prices were thumped 11% to average US$2,548/t, with the lowest starting demand rates reported on GDT (with data only available since event #158). Chinese involvement was similar portion as the previous event, for the highest event volume since April. Middle East buyers however swooped to take advantage of the cheap product for the highest tonnage since 2016. SMP prices also suffered from low starting demand, falling 4.9% to average US$2,333/t. Chinese buyers reduced their involvement this time, but worryingly SE Asian buyers had the smallest involvement in 6 events.

Butterfat could not escape the rout – butter got off with a smaller fall but in both cases the C2 contract loss was much smaller than the average. Butter price fell 3% to average US$4,539/t while AMF fell 5.4% to average US$4,452/t.

Cheddar bucked the trend, adding US$217/t or 5.5% to average US$4,127/t. The improved US cheese market likely added some support, although given powder stream returns, it’s like more NZ will be produced in coming months.