The international dairy market received a solid boost at Tuesday’s GDT auction. While most categories posted gains, it was butter that stole the spotlight with a double-digit price increase.
At auction number 398 on 17 February, Global Dairy Trade (GDT) underlined the strength of demand for milk fat. The overall price index rose by 3.6 per cent, bringing the average trading price to USD 4,028 (EUR 3,398) per tonne.
Butter leads the ‘fat rally’
Fat-based products acted as the locomotive for the entire auction. Butter delivered a standout performance, climbing 10.7 per cent to USD 6,347 (EUR 5,354) per tonne.
Optimism also extended to anhydrous milk fat (AMF), which increased by 3.8 per cent to USD 6,751 (EUR 5,694) per tonne. The strong advance points to robust global appetite for milk fat — often an important indicator for European dairies and the prices they can achieve on export markets in the coming spring.
Broad-based gains — except cheddar
Growth was not limited to fats. Powder categories also moved higher:
The outlier was cheddar, which moved against the trend with a modest decline of 1.0 per cent. Lactose, meanwhile, surged by 7.8 per cent. No price index or average price was reported for buttermilk powder at this auction.
What does this mean for the market?
Rising prices — particularly for butter and powders — send a positive signal to the industry following a period of uncertainty. When the GDT index climbs as sharply as 3.6 per cent, it often lays the groundwork for price increases further along the value chain. For European producers, the renewed strength in fat prices provides a welcome benchmark for price formation in the months ahead.
By Maja Løvstrup
Source: Global Dairy Trade
Photo: globaldairytrade.info
