Dairy auction prices set to rise

Prices on the Global Dairy Trade auction may lift next week, snapping four consecutive declines, as the increased threat of drought in New Zealand weighs on expectations for Fonterra Cooperative Group’s milk production. The NZX whole milk powder futures contracts for December last traded at US$ 2,840 a tonne, 3.7 per cent ahead of the equivalent contract at the last Global Dairy Trade auction on November 21, signalling traders expect the price to rise at the next auction. Longer- dated whole milk powder futures contracts are also signalling an increase, as are futures contracts for skim milk powder, while futures for butter and anhydrous milk fat point to declines.