DAIRY industry leaders have expressed interest in temporarily suspending Fonterra’s GlobalDairyTrade following a run of falls in the past 10 auction rounds.
It’s a call that Burra Foods’ CEO Grant Crothers has noted in his latest communique to suppliers
He recommended an online article by Tao Lin and Gerald Piddock in the NZFarmer as “a very interesting read on the recent milk commodity deflation and the request to temporarily suspend the GDP auction until the market improves”.
See story at http://www.stuff.co.nz/business/farming/dairy/70835050/calls-made-to-s
In the latest round of auctions, on Wednesday, August 4, 46,527 metric tonne of dairy product was sold with prices overall down by 9.3 per cent.
The price of Skim Milk Powder fell 14.4% to $1419, butter fell 6.1% to $2293 and Whole Milk Powder fell 10.3% to $1590.
The article notes that “the slump in dairy prices has seen the New Zealand dollar fall sharply this year and the Reserve Bank cut interest rates, with more expected”.
It notes a comment by Waikato Federated Farmers president Chris Lewis that “temporarily suspending the GDT was a reasonable question to ask, given the unprecedented and volatile times the industry faced”.
He claimed the auction process could exacerbating dairy market volatility and the extent of the drop in prices.