Global Dairy Trade weaker across the whole line

The second Global Dairy Trade auction of June shows the largest decline since early April. Both milk powders, butter and cheeses are showing price declines. The average price decline comes to 2.8%. Mozzarella falls the hardest, by 5% to $3,750 per ton. This concerns European product from among others Arla and Solarec. The decline is not entirely surprising, because the European cheese market has been moving downward in recent weeks, with price declines also for foil cheeses. Cheddar also falls, by 3.4% to $4,471 per ton. This is the lowest price on the GDT this year. The price is being depressed because a lot of cheese is coming onto the market, after the peak in supply in the western hemisphere. The milk powders continue the downward trend. Skimmed milk powder falls by 3.6% to $3,368 per ton, while whole milk powder falls by 3.1% to $3,589 per ton. In both cases, European product was traded the cheapest and there is a premium for milk powder from New Zealand. The decline is related to sharply lower oil prices, now that there appears to be a ceasefire between the US and Iran. The rise in the oil price had recently provided support to the milk powder market. After two slight increases, butter falls again, by 2.4% to $5,516 per ton. Striking is the large price difference between European product ($4,522 per ton) and butter from New Zealand ($6,020 per ton).