A restructured management approach that has put more onus on staff is paying dividends for farm managers Isaac and Michelle Johnstone.
In the wake of another positive GDT event last week spot quotes from Australasian exporters were mostly firmer, butter the exception. Cheddar rose US$250/t to US$3,700/t - its highest quote since March 2015. SMP also added US$250/t to average US$2,650, finally breaking free of a tight trading range between US$2,300/t and US$2,400/t as new product becomes scarce. News that the EU is considering releasing SMP intervention stocks earlier than anticipated may dampen price momentum. WMP added another US$150/t to average US$3,500/t, spot values not seen since July 2014, as market perceptions of NZ shortages strengthen. Butter remained at US$4,200/t for the third consecutive week.
The Australian dollar ended the week 2c lower at US$0.735, its lowest exchange rate since June this year. The greenback continued to strengthen as markets bet on the US Fed hiking rates in December. The odds improved on Friday as US Fed chair Janet Yellen strongly suggested to congress that a rate increase was on the table for next month. In addition, iron ore prices slumped 9% this week – weighing on the currency.
These factors combined to add 17 points to the index, which now stands at 206.7.
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.