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UPDATE 1-Global dairy prices fall, after six auctions of gains
June 20, 2017 / 10:03 PM / 5 months ago

UPDATE 1-Global dairy prices fall, after six auctions of gains

 (Adds analyst comment, market reaction)
    By Charlotte Greenfield
    WELLINGTON, June 21 (Reuters) - Global dairy prices slipped,
breaking a winning streak of six consecutive rises, at a
fortnightly auction on Wednesday, as whole milk powder softened.
    The Global Dairy Trade (GDT) Price Index dipped 0.8 percent,
with an average selling price of $3,434 per tonne, in the
auction held in the early hours of Wednesday morning. The index
had risen 0.6 pct at the previous sale.
    After two years of declining prices, farmers and analysts
had been concerned that a 50 percent rebound during 2016 could
be temporary but prices got back on track the past few months as
global supply tightened.
    The fall at the latest auction was led by
weaker-than-expected prices for whole milk powder (WMP), which
fell 3.3 percent compared to derivative markets expectations of
a 1.3 percent rise.
    "WMP has been selling regularly over recent months, so some
buyers have sufficient coverage for now. The quantity of WMP
sold to North Asia was less than seen at recent events," said
Amy Castleton, an analyst at AgriHQ.
    The auction results can affect the New Zealand dollar
         as the dairy sector generates more than 7 percent of
the country's gross domestic product. The Kiwi slipped from
around $0.7268 to $0.7237.
    GDT Events is owned by New Zealand’s Fonterra Co-operative
Group Ltd         , the world's largest exporter of dairy, but
operates independently from the company, but operates
    U.S.-listed CRA International Inc          is the trading
manager for the twice-monthly Global Dairy Trade auction.
    A total of 21,171 tonnes was sold at the latest auction,
falling 3.8 percent from the previous one, the auction platform
    The auctions are held twice a month, with the next one
scheduled for July 4.

 (Reporting by Charlotte Greenfield; editing by Grant McCool)

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