Futures market trading is pointing to a mild improvement in dairy prices at this week’s GlobalDairyTrade auction after a surprisingly weak start to the year.
Whole milk powder prices look likely to improve a little after dropping 7.7 per cent at the previous sale in what was later seen as a rebalancing between the main products on offer.
In the big picture, analysts said the likelihood of continued declines in world production would remain supportive for prices this year.
Karl Arns, dairy futures broker at OM Financial, said the first sale of 2017 on January 4 – which saw prices overall fall by 3.9 per cent – was looking like an aberration.
“We certainly expect the result to be positive,” he said.
“The exact amount of the improvement is uncertain but something around 2 to 4 per cent (for whole milk powder) looks likely,” he said. Dairy HQ analyst Susan Kilsby also expects to see a small improvement.
Source: NZ Herald