The GDT index posted one of its strongest surges ever, lifting 15% as WMP and butterfat prices soared on strong Chinese demand. Nothing in the published market fundamentals data helps explain this one. Buyers in China were short and came to GDT to solve a problem, dominating WMP and butter purchases, while late notice of a cut in butterfat volumes probably drove the lift in AMF prices.

WMP surged 20.7% or $749/t to average US$4,364/t as Chinese buyers accounted for three-quarters of the sales, with consistent gains across contracts. Regular product C2 WMP added 20.5% or US$735/t to US$4,320/t. The result left a flat forward curve for regular product that touched US$4,400/t in C4. SMP was meek in comparison, gaining 3.0% or US$95/t to average US$3,302/t, with the smallest gain in the average of C2 contracts and larger increases for later periods. The NZ MH product again performed a little stronger than European SMP with no US product offered. The NZ premium over EU product widened to US$389/t as Fonterra’s MH product for C2 gained US$90/t to US$3,345/t.

Fats prices posted huge gains. Butter gained US$697/t or 13.6% to push the average to US$5,929/t, with varied increases across contracts, with C2 doing the best to put on 16.1% to US$5,950/t. AMF prices added 7.3% or US$402/t to average US$5,929/t, with consistent gains across contracts except for the 5% added in C5.

 There were inconsistent changes across Cheddar contracts as the average added $12/t to $4,280/t, and C2 gained $18/t to $4,270/t. Lactose added $46/t at this event, to finish at $1,278/t, and remained below the peak in prices reached in August.