20 Aug 2014

Dairy prices fall again - fractionally

10:21 am on 20 August 2014

Dairy prices have again dropped in Fonterra's international dairy price auction overnight, but by significantly less than in recent weeks.

dairy milk truck.


Average dairy prices have dropped point six (0.6) of a percentage point.

In the last fortnightly auction prices fell 8.4 percent - a 40 percent drop since February.

Fonterra has cut its forecast payout to farmers from $7 per kilogram to 6 on the back of the falling international demand.

That has been attributed to a lack of Chinese buyers, who overstocked on milk powder last year because of concerns Chinese regulation of infant formula could restrict supply.

Hayley Moynihan, a senior dairy analyst at Rabobank, says while whole milk prices rose by 3.4 percent, prices for other products are still falling dramatically.

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