It’s strange times for the global dairy market, and one of the crazier things we’re seeing is how the butterfat market has performed lately.
Spot quotes from Australasian exporters were all unchanged this week. Milk powder prices have proved the most “sticky” - SMP quotes have been US$2,050/t since mid-August, while WMP has been quoted at US$2,700/t for the past three weeks. Butter held at US$3,250/t while cheddar remains at US$3,200/t, also for the third consecutive week.
The Aussie dollar ended last week higher at US$0.757, the result of a weak US jobs report released on Friday which pushed the greenback lower. Weaker than expected non-farm payrolls in August and a disappointing wage result weighed on the US currency.
These factors combined to shave the index by 0.3 of a point, to 163.6.
Note: - The index is an indicator of spot trends in gross export returns to the Australian dairy industry based on quoted Australasian dairy commodity export spot prices, movements in currency and the mix of total milk usage in product exports by the Australian industry.
This index was set at 100 on 1 January 2000.