“There were aggressive price increases (6- 11%) for near-term delivered WMP, which highlights some buyers are currently short of product having been sitting on their hands awaiting higher seasonal volumes from New Zealand.
If peak New Zealand seasonal flows disappoint in any way, then there could well be further gains to come, especially with low carry-over inventory from 2016/17 and the market already primed for a circa 3% lift in 2017/18 supply. Elsewhere, things were a touch softer, with SMP (-4.5%), AMF (-3.5%) and Cheese (-3.2%) all declining.”
“SMP prices have been pressured by offshore dynamics with the European Commission trying to move some of its large stockpile at lower prices and previously quarantined US product being released. With these dynamics it will be difficult for NZ product to maintain much of a premium through the local seasonal peak.”
“Milkfat movements can be viewed as minimal, with butter continuing to sit at record highs and AMF only slightly backing off. Higher upcoming seasonal demands in the run-up to Christmas will need to be met with an increase in Northern Hemisphere supply.”
Source: FX Street