Global Dairy Prices Extend Decline in Latest Auction

Highlights:

• Global dairy prices fell 1.6% at the time of writing in the latest Global Dairy Trade (GDT) auction, marking the fourth consecutive decline.
• Whole milk powder — a key product influencing farmgate milk prices — dropped 2.3%, while skim milk powder eased by 0.5%.
• Persistent global oversupply and cautious demand continue to weigh on prices, raising concerns about margins for dairy producers.

Global dairy commodity prices continued to slide in the latest Global Dairy Trade (GDT) auction, with the overall index falling 1.6 % “at the time of writing”. This marks the fourth straight drop, signaling sustained weakness in dairy markets.

Weakness Broad Among Key Products

The decline spanned most major dairy product categories: whole milk powder — a benchmark for many farmers’ milk payout — dropped 2.3 %, while skim milk powder eased by 0.5 %. Other segments such as butter and buttermilk powder also recorded losses. Only a few products bucked the trend — for instance, anhydrous milk fat (AMF) edged higher, and cheddar posted a modest gain.

Drivers Behind the Slide

Analysts point to persistent oversupply, particularly from large exporting regions, as a key pressure point. Emerging production in the Northern Hemisphere is intensifying competition. At the same time, demand appears hesitant to keep pace, especially under the weight of input costs and macro uncertainty.

Seasonal swings and currency fluctuations are also influencing buyer behavior, as weaker markets encourage importers to hold off on fresh commitments. The current deficit in demand relative to supply has amplified downward momentum in the dairy complex.

Implications for Producers & Outlook

Because whole milk powder plays a central role in setting farmgate milk prices — especially for major exporters — its decline is closely watched by dairy producers and policymakers. The ongoing streak of falling auctions raises questions about margin pressure across the supply chain.

That said, dairy markets are notoriously cyclical. A rebound in seasonal demand, supply constraints in key regions, or shifts in trade dynamics could spark a reversal. For now, stakeholders will be closely watching upcoming GDT results, export volumes, and global consumption patterns to see whether this downturn deepens or finds a floor.

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