Milk Powder Prices Surge On The Other Side Of The World
Leading global dairy exporter Fonterra report that prices for whole white milk powder rose 13.7% to USD3,437/tonne in it's latest online auction yesterday.
Prices peaked above USD5,000/tonne in October 2007, but subsequently crashed to five year lows close to USD1,800/tonne as recently as July this year.
Since then prices have rebounded sharply, appreciating by around 88% on strong demand from Asia and the Far East. Prices are now at a 13-month high as demand for dairy products returned to pre-crisis levels, Fonterra say.
In sharp contrast to the fortunes of dairy farmers in Europe and the US, Fonterra raised the price it pays New Zealand farmers for milk by 12% in September.
Analysts say that the recent sharp increase in prices is the result of strong demand and improved confidence in the global economic recovery.
Buying interest from China remains strong in the wake of the recent melamine scandal, with Chinese consumers still very reluctant to buy domestically sourced milk products, according to some reports.
Consumers clearly believe that further price rises are on the way. The average price paid in yesterday's auction for Jan 10 delivery was USD3,352/tonne (up 11%), but for Feb/Apr 10 delivery the average price was USD3,393/tonne (up 12.8%) and for delivery in May/Jul 10 the average price was USD3,684/tonne (up 20.7%).
Prices peaked above USD5,000/tonne in October 2007, but subsequently crashed to five year lows close to USD1,800/tonne as recently as July this year.
Since then prices have rebounded sharply, appreciating by around 88% on strong demand from Asia and the Far East. Prices are now at a 13-month high as demand for dairy products returned to pre-crisis levels, Fonterra say.
In sharp contrast to the fortunes of dairy farmers in Europe and the US, Fonterra raised the price it pays New Zealand farmers for milk by 12% in September.
Analysts say that the recent sharp increase in prices is the result of strong demand and improved confidence in the global economic recovery.
Buying interest from China remains strong in the wake of the recent melamine scandal, with Chinese consumers still very reluctant to buy domestically sourced milk products, according to some reports.
Consumers clearly believe that further price rises are on the way. The average price paid in yesterday's auction for Jan 10 delivery was USD3,352/tonne (up 11%), but for Feb/Apr 10 delivery the average price was USD3,393/tonne (up 12.8%) and for delivery in May/Jul 10 the average price was USD3,684/tonne (up 20.7%).