THE overall Price Index decreased 3.9 per cent at the first Global Dairy Trade (GDT) event of 2017. The drop was largely driven by a 7.7 per cent fall in Whole Milk Powder (WMP) Price Index, which made up nearly half of the product traded.
WMP sold on GDT had previously been achieving a premium over EU WMP prices, but this latest decrease appears to have brought it closer to EU pricing again. However, EU prices for early January are not yet available, so the European price direction at the start of the New Year remains to be seen.
Meanwhile, Skimmed Milk Powder (SMP) sold on GDT maintained its rather significant premium over EU product. The SMP GDT Price Index increased another 2.3 per cent, but intervention stocks have weighed heavily on EU prices in recent weeks.
Overall, the slowdown in milk production in Oceania and the EU has helped put upward pressure on dairy commodity prices. However, product and region-specific supply-demand variations are adding a little more complexity to the global picture as we begin the New Year.
Meanwhile, in the UK lower average retail prices for cheese, particularly for Cheddar, offset higher sales, preventing any growth in the value of the retail cheese market in the year to November 2016. According to the latest Kantar Worldpanel data, retail sales of cheese have grown by 3.8 per cent in the 52 weeks ending 6 November 2016, driven primarily by growth in sales of soft continental-type cheeses. While prices fell year-on-year for all types of cheese, the 5.1 per cent drop in the average price for Cheddar meant the value of this sector fell by over £50 million over the period, negating any gains from other categories.
Market round-up
United Auctions sold 508 store heifers at Stirling on Wednesday to a top of 269.8p per kg and an average of 210.3p, while 896 store, beef-bred bullocks peaked at 273.2p and levelled at 210.3p. Eighty-nine store, B&W bullocks sold to 177.6p and averaged 138.2p.
In the rough ring 144 beef cows sold to £1530 per head and 170.3p per kg to average 119.3p, while 11 dairy cows peaked at £895 and 120.9p to level at 93.4p.
Harrison & Hetherington Ltd sold 27 prime heifers in St Boswells to a top of 240p and an average of 218.1p (-5.1p on the week), while eight prime bullocks peaked at 226p and levelled at 217p (-12.6p).
In the rough ring 17 beef cows sold to 187p and averaged 139p (+16.6p).
The firm also sold 975 prime hoggs to a top of £94 per head and 212.7p per kg to average 168p (+10p).
A small show of 109 cast sheep saw heavy ewes sell to £100 for Texels and average £70, while light ewes peaked at £80 for Cheviots and levelled at £37.
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