Global Dairy Trade Results Update – 3/17/20
Executive Summary
Dairy product prices continued to decline during the GDT event held Mar 17th. Highlights from the most recent auction include:
The GDT Price Index finished 13.1% below previous year price levels at the Mar 17th auction, declining on a YOY basis for the third consecutive event. The GDT Price Index finished 9.4% below the three year average price for the second auction of March, finishing below three year average figures for the fourth consecutive event.
Within the latest auction, declines in prices were led by skim milk powder (-8.1%), followed by whole milk powder (-4.2%). The declines more than offset increases in butter (+0.3%), anhydrous milkfat (+1.0%), rennet casein (+1.0%), cheddar cheese (+2.6%) and lactose (+4.9%) prices. Butter milk powder and sweet whey powder were not sold at the Mar 17th event.
The table below provides a summary of the most recent GDT weighted average winning prices for key products. Butter has been adjusted to 80% butterfat and skim milk powder (SMP) has been adjusted to 35% protein content (equivalent to U.S. nonfat dry milk) in the $/lb columns below. CME spot and average futures prices are based on Mar 16th figures. CME average futures prices are weighted average prices based on the most recently reported percentage of the total quantity sold in each GDT contract period.
Total quantities sold for all products at the Mar 17th event declined 5.3% from the previous event but remained 11.5% higher on a YOY basis. The YOY increase in total quantities sold was the sixth experienced in a row.
Volumes sold for all products within the March auctions declined 12.9% from average February volumes sold but finished 9.1% above last year’s average volumes sold for the month of March. Mar ’20 volumes sold for all products finished 16.3% above three year average seasonal figures, reaching a six year seasonal high level.
U.S. butter prices remained at a slight premium to GDT winning prices at the Mar 17th event, despite GDT butter prices increasing from the previous auction. U.S. spot butter prices are currently trading at a 3.3% discount to GDT prices however CME futures prices traded at a 0.3% premium to GDT prices from Apr ’20 – Aug ’20. Butter was not sold at the GDT auction for Contract 6 (Sep ’20).
U.S. cheddar cheese prices remained at a discount to GDT winning prices at the Mar 17th event as GDT cheddar cheese prices rebounded from the previous auction. U.S. spot cheddar cheese prices are currently trading at a 15.5% discount to GDT prices while CME futures prices traded at a 15.6% discount to GDT prices from Apr ’20 – Jul ’20. Cheddar cheese was not sold at the GDT auction for Contract 5 (Aug ’20) and Contract 6 (Sep ’20).
U.S. nonfat dry milk (NFDM) futures prices also remained at a discount to GDT SMP winning prices at the Mar 17th event, despite GDT SMP prices declining to a six month low level. U.S. spot NFDM prices are currently trading at a 13.1% discount to GDT SMP prices while CME futures prices also traded at a 15.3% discount to GDT SMP prices from Apr ’20 – Aug ’20. SMP was not sold at the GDT auction for Contract 6 (Sep ’20).
- The GDT Price Index declined 3.9% at the Mar 17th event, finishing at a 14 month low level. The GDT Price Index finished lower on a YOY basis for the third consecutive event, finishing down 13.1%.
- Declines in prices within the Mar 17th event were led by skim milk powder, followed by whole milk powder. Skim milk powder prices declined to a six month low level throughout the Mar 17th event while whole milk powder prices reached a 14 month low level. Anhydrous milkfat, butter and cheddar cheese prices increased from the previous event.
- Total quantities sold for all products at the Mar 17th event declined seasonally from the previous event but remained higher on a YOY basis for the sixth consecutive event. Volumes sold for all products within the March auctions finished 9.1% above last year’s average volumes sold for the month of March and 16.3% above three year average seasonal figures, reaching a six year high seasonal level, overall.
The GDT Price Index finished 13.1% below previous year price levels at the Mar 17th auction, declining on a YOY basis for the third consecutive event. The GDT Price Index finished 9.4% below the three year average price for the second auction of March, finishing below three year average figures for the fourth consecutive event.
Within the latest auction, declines in prices were led by skim milk powder (-8.1%), followed by whole milk powder (-4.2%). The declines more than offset increases in butter (+0.3%), anhydrous milkfat (+1.0%), rennet casein (+1.0%), cheddar cheese (+2.6%) and lactose (+4.9%) prices. Butter milk powder and sweet whey powder were not sold at the Mar 17th event.
The table below provides a summary of the most recent GDT weighted average winning prices for key products. Butter has been adjusted to 80% butterfat and skim milk powder (SMP) has been adjusted to 35% protein content (equivalent to U.S. nonfat dry milk) in the $/lb columns below. CME spot and average futures prices are based on Mar 16th figures. CME average futures prices are weighted average prices based on the most recently reported percentage of the total quantity sold in each GDT contract period.
Total quantities sold for all products at the Mar 17th event declined 5.3% from the previous event but remained 11.5% higher on a YOY basis. The YOY increase in total quantities sold was the sixth experienced in a row.
Volumes sold for all products within the March auctions declined 12.9% from average February volumes sold but finished 9.1% above last year’s average volumes sold for the month of March. Mar ’20 volumes sold for all products finished 16.3% above three year average seasonal figures, reaching a six year seasonal high level.
U.S. butter prices remained at a slight premium to GDT winning prices at the Mar 17th event, despite GDT butter prices increasing from the previous auction. U.S. spot butter prices are currently trading at a 3.3% discount to GDT prices however CME futures prices traded at a 0.3% premium to GDT prices from Apr ’20 – Aug ’20. Butter was not sold at the GDT auction for Contract 6 (Sep ’20).
U.S. cheddar cheese prices remained at a discount to GDT winning prices at the Mar 17th event as GDT cheddar cheese prices rebounded from the previous auction. U.S. spot cheddar cheese prices are currently trading at a 15.5% discount to GDT prices while CME futures prices traded at a 15.6% discount to GDT prices from Apr ’20 – Jul ’20. Cheddar cheese was not sold at the GDT auction for Contract 5 (Aug ’20) and Contract 6 (Sep ’20).
U.S. nonfat dry milk (NFDM) futures prices also remained at a discount to GDT SMP winning prices at the Mar 17th event, despite GDT SMP prices declining to a six month low level. U.S. spot NFDM prices are currently trading at a 13.1% discount to GDT SMP prices while CME futures prices also traded at a 15.3% discount to GDT SMP prices from Apr ’20 – Aug ’20. SMP was not sold at the GDT auction for Contract 6 (Sep ’20).