Whole milk powder prices average $3,809 per MT in GDT auction

Whole milk powder prices average $3,809 per MT in GDT auction

Whole milk powder prices averaged $3,809 per metric ton (MT) in the latest Global Dairy Trade (GDT) auction, reflecting a notable increase from the previous year's prices. This significant rise underscores the ongoing volatility in the dairy market, driven by a combination of supply and demand dynamics.

The GDT auction, a key benchmark for dairy prices, saw an average price of $3,809 per MT for whole milk powder, up from $3,623 per MT in the corresponding period last year. This upward trend can be attributed to several factors, including increased global demand for dairy products and a steady supply of milk from key producers.

Global milk production in 2023 rose by 1.1% to 666.595 million metric tons, with India, the European Union, and the United States leading the way as the largest producers. Despite a slight decrease in the number of dairy cows in the US, milk production remained robust, with an average cow producing a record 24,113 pounds of milk per year in 2023 [1].

The CME Group's milk futures contracts, including Milk Class III, Milk Class IV, and Nonfat Dry Milk, have shown varying price movements. The Milk Class III contract, which is used in the manufacturing of cheese, has the largest volume and open interest. However, the specific impact of these futures contracts on whole milk powder prices is not directly detailed in the provided source materials.

US imports of milk in 2023 were up by 1.0% year-over-year, reaching 7.130 billion pounds. This increase in imports indicates a continued reliance on international markets to meet domestic demand. The record high of 7.500 billion pounds posted in 2005-06 remains a benchmark, but the recent import figures suggest a steady, albeit lower, level of dependence on international supplies.

In conclusion, the average price of $3,809 per MT for whole milk powder in the GDT auction reflects the current market conditions, influenced by production levels, demand trends, and trade dynamics. Investors and financial professionals should closely monitor these trends to make informed decisions in the dairy market.

References:
[1] https://www.barchart.com/futures/quotes/K3*1/profile