Sharp downturn at GDT event 393

Global Dairy Trade (GDT) Event 393 recorded a sharp decline of 4.3%, broadly in line with the signal provided by SGX futures under the “all contracts” methodology, which indicated a 4.9% decrease. The average winning price closed at $3,507 per ton, a decrease of 4.65% compared with Event 392.New Zealand’s offered volume fell by 12.40%, or 4,789 tons, compared with the previous event. This decline reflects a combination of lower product availability and the reintroduction of BMP. Offered volumes dropped across all major commodities, including whole milk powder (down 11.66%), skim milk powder (down 19.05%), Cheddar (down 19.74%), Butter (down 17.95%), and anhydrous milkfat (down 11.29%).For the year to date through September, New Zealand’s milk production has increased by 1.65%, adding 264 million kilo of milk.Detailed Results of GDT Event 393 PRICE INDEX DOWN -4.3%, AWP $ 3.507 NZ Supply AMF DOWN -9.8%, AWP $5,902 ↓ BUTTER DOWN -12.4%, AWP $ 5,169 ↓ Cheddar UP 7.2%, AWP $4,639 ↑ SMP DOWN -1.6%, AWP $ 2,498 ↓ WMP DOWN - 2.4%, AWP $ 3,364 ↓ European and US Supply Butter (Solarec) DOWN -9.34%/ $ 4,835/mt (average price) ↓ Mozzarella DOWN -2.99% AWP $ 3,214 ↓ Lactose ( Polmlek) UP 4.2%/ AWP US $ 1,250 ↑ SMP W-Europe, Arla, DOWN -1.26%, AWP $ 2,382 (average price) ↓ SMP W-Europe, Solarec, DOWN -4.10%, AWP $ 2,337 (average price) ↓ SMP USA N.A., / AWP N.A.. ↔ WMP W-Europe,Solarec/ DOWN -9.60% . AWP $ 3,360 (average price) ↓ The GDT Price Index declined by 4.3%, with the average winning price settling at 3,507 dollars per ton.Anhydrous milkfat (AMF) fell by 9.8%. The largest decrease occurred in Contract 6, with the smallest in Contract 1. The Butterfat value in AMF stands at 5,932 dollars per ton on a 100% fat basis.Butter experienced a substantial decline of 12.4%. Its Butterfat value is now 6,265 dollars per ton on a 100% fat basis. The Butterfat value difference between Butter and AMF has widened to 334 dollars per ton in favour of Butter. In this event, the Butter–AMF relationship made an important step toward realigning price levels with underlying component values.Cheddar unexpectedly increased by 7.2%, even as US Cheddar prices moved toward historic lows.Skim milk powder (SMP) decreased by 1.6%, with the largest drop in Contract 2 and the smallest in Contract 5.Whole milk powder (WMP) fell by 2.4%, with the greatest decline in Contract 1 and the smallest in Contract 5. A notable price spread emerged between front-month and later-dated contracts in both AMF and Butter. NZ front deferred Last vs front AMF $6.096 $5.877 -3,59% BUTTER $5.195 $5.380 3,56% CHEDDAR $4.681 $4.611 -1,50% SMP $2.520 $2.533 0,52% WMP $3.305 $3.375 2,12% European and US SupplyEuropean prices declined across the board, except for Lactose, which was offered for the first time by the Polish company Polmlek. US SMP remained unchanged but was not offered in this event. The day after the auction, the CME spot call session saw US SMP settle at $2,664 per ton on an FOB basis.Although the SGX market had anticipated the negative GDT outcome, it reacted with additional losses in the days following the auction. Most commodities continued to drift lower, with AMF and Butter experiencing the most pressure. WMP 20/11/2025 03/12/2025 ∆ ∆% December $3.290 $3.285 -$5 -0,15% January $3.295 $3.265 -$30 -0,91% February $3.295 $3.265 -$30 -0,91% March $3.310 $3.285 -$25 -0,76% April $3.410 $3.380 -$30 -0,88% May $3.455 $3.400 -$55 -1,59% SMP December $2.545 $2.500 -$45 -1,77% January $2.545 $2.490 -$55 -2,16% February $2.560 $2.500 -$60 -2,34% March $2.590 $2.530 -$60 -2,32% April $2.635 $2.580 -$55 -2,09% May $2.660 $2.615 -$45 -1,69% AMF December $6.465 $5.850 -$615 -9,51% January $6.130 $5.675 -$455 -7,42% February $6.080 $5.600 -$480 -7,89% March $6.030 $5.500 -$530 -8,79% April $6.000 $5.459 -$541 -9,02% May $6.000 $5.400 -$600 -10,00% BUTTER December $5.735 $5.100 -$635 -11,07% January $5.575 $4.825 -$750 -13,45% February $5.525 $4.905 -$620 -11,22% March $5.525 $4.900 -$625 -11,31% April $5.445 $4.900 -$545 -10,01% May $5.425 $4.890 -$535 -9,86% Average prices C1-C6 20/11/2025 03/12/2025 ∆ ∆% WMP $3.343 $3.313 -$29 -0,87% SMP $2.589 $2.536 -$53 -2,06% AMF $6.118 $5.581 -$537 -8,78% BUTTER $5.538 $4.920 -$618 -11,16% The negative reaction on SGX has been persistent but remains consistent with current cash and futures market trends. With Event 393, Fonterra has reached the end of a long sequence of favourable theoretical GDT income results. For the current season up to this event, results have turned negative by 1.23%, representing an income decline of 22 million dollars compared with the average prices of the 2024/25 season.