Once again, despite the tight fat and SMP supplies in the EU and another strong run-up by NZX milk powder futures quotes, the index for event 294 was just 2.2% higher. The major powders made small gains on average while fats were reflective of the limited options facing buyers. Chinese buyers came back, buying more than half of each of WMP and SMP.

The best gains in SMP were made by northern hemisphere suppliers. EU product was pulled US$60/t higher than Fonterra’s product, while even US product lifted near 5% and beat the NZ price like-for-like. Fonterra MH C2 gained US$80/t to US$3,390/t, leaving a relatively flat forward curve at or under US$3,400/t.

WMP added 1.4% on average to US$3,803/t, the highest average result in 7 events. Fonterra Regular C2 gained US$75/t to US$3,760/t (also the best in 7 events) with better prices later, with C4 at US$3,845/t.

Fats made the strongest gains in this event. Butter added 4.8% or US$233/t on average to US$5,111/t. C2 added US$230/t to US$5,130/t, with consistent gains across contracts. AMF added US$167/t or 2.8% on average to US$6,151/t, weaker gains for later delivery, leaving a weaker forward curve. C2 added US$171/t to US$6,162/t. The AMF premium (fat equiv) was lowered to just US$43/t.

Cheddar was generally stronger with solid gains across C2-C4. There was a strong C1 purchase that lifted above US$4,500/t, while C2 added US$98/t to give the weakest price of US$4,396. Lactose posted a 5.9% gain or US$70/t to US$1,258/t.