New Zealand’s shopping public will be relieved soaring butter prices had some of their steam removed at Fonterra’s global dairy trade (GDT) auction.
An overall back-to-back rise will be music to dairy farmers’ ears, but family shoppers will be honing in on butter prices dropping 3.8% to $12,220 a tonne.
Overall prices increased marginally 0.7% for about 37,000 tonnes of dairy products sold overnight on Tuesday, including a 2.1% gain for the main staple of whole milk powder to nearly $6800.
The average price across the range was nearly $7200 a tonne, up on a 1.1% gain at the last auction on July 15.
Record butter prices have raised the ire of family shoppers, resulting in Fonterra chief executive Miles Hurrell stepping in to explain they had increased about 50% over the past year because of high global dairy prices.
A GDT drop will increase expectations for this to show up in the domestic marketplace.
However, the Fonterra leader indicated high prices for a butter block could stick around for longer as strong demand was still being seen internationally, particularly in China and Asia.
Buttermilk powder fell 2% to $5166, while cheddar slipped 0.6% to $7750 and mozzarella 0.1% to $7945.
On top of the advance for whole milk powder, anhydrous milk fat increased 1.2% to $11,995 and skim milk powder was up 0.4% to $4751.
No lactose was offered.
The result follows four consecutive auctions in negative territory, including a 4.1% overall drop in early July.
