GDT event 390 signals weak outlook for global dairy prices

Since the previous Global Dairy Trade (GDT) auction, market sentiment has remained bearish. Event 390 may provide clearer direction, though international dairy futures across the United States, New Zealand, and the European Union have continued to trend lower.Based on SGX Futures data, a downward adjustment in GDT prices appears likely if results align with the futures. The “all contracts” method indicates a potential decline of -3.25%, while the C2 method points to a nearly unchanged result of -0.03%.Key market insightsNew Zealand milk production: Cumulative production up to September rose 1.64%, equivalent to an increase of 212 million kilo.SGX Dairy futures: Market sentiment has softened in recent weeks. Average prices across all commodities have declined notably compared with the winning prices from Event 389.Volumes and products: With the new production season underway, auction volumes remain high. The total volume offered in Event 390 was 40,476 tons, a decrease of -2.77% compared with Event 389, mainly due to the absence of BMP and a -2.45% reduction in WMP volumes. All other product volumes were unchanged.Exports: As of August 2025, year-to-date exports increased by 0.54%, equivalent to 73 million kilo of liquid milk equivalent.Expected price impact: If GDT 390 aligns with SGX Futures, the GDT Price Index could slip by -0.03% under the C2 method and -3.25% under the all-contracts method. This indicates that deferred contracts are notably weaker than nearby ones.Composition of offerings: Whole Milk Powder (WMP) continues to dominate GDT volumes, accounting for 56.23% of total product offerings in Event 390. Price movements in this segment will heavily influence overall market sentiment and the index outcome.Global outlook: Dairy futures across New Zealand, the US, and the EU remain under pressure, reflecting persistent bearish sentiment in the global market.Futures development: Since the previous GDT event, average futures prices (C1–C6 contracts) have fallen relative to the average winning prices (AWPs) achieved in Event 389. AMF -3,70% SMP -2,17% Butter -2,48% WMP -3,77% GDT Event 390 is set against a broadly bearish backdrop, shaped by both futures market signals and ongoing physical market conditions. With weaker sentiment across major dairy regions and substantial product volumes still available, the short-term outlook remains negative.