A preview of the Global Dairy Trade auction during London time today
After a long, long run of declining prices the index took a turn up at the previous auction (on December 4)
Expectations are mixed for another index gain at this auction (a gain should be a positive input for the NZ dollar (dairy is a huge NZ export).
Says Westpac:
- priced by futures to result in a 3% increase in WMP prices.
Says ASB, though:
- We expect whole milk powder prices to be unchanged
- A fortnight ago whole milk powder (WMP) prices rose by 2.5% and at the current juncture futures pricing points to another similar lift. The lift at the last auction looks to have been partly driven by the weaker USD. Since the last auction, the USD had strengthened against the Chinese yuan, which along with strong domestic milk production, should limit upward pressure on prices.
