WELLINGTON: Global dairy prices rose at the first auction of the year on Wednesday, continuing a recovery after falling throughout most of last year.
The GDT Price Index climbed 2.8 percent, with an average selling price of $2,986 per tonne, in the twice monthly auction held by GDT Events.
The index rose 1.7 pct at the previous sale and has now gained for three consecutive auctions, after declining for months as higher-than-expected supply in New Zealand, the world's biggest dairy exporter, dampened prices.
Volumes tightened at the latest auction with a total of 28,651 tonnes sold, falling 20.8 percent from the previous one, the auction platform said on its website.
Prices for skim milk powder jumped 7.9 percent, while prices for whole milk powder, the most widely traded item, gained 1.2 percent.
The auction results can affect the New Zealand dollar as the dairy sector generates more than 7 percent of the nation's gross domestic product. However, on Wednesday the currency was affected more by concerns over global growth and weak Chinese factory activity and was trading down 0.9 percent at an almost two-month low of $0.6655.
GDT Events is owned by New Zealand's Fonterra Co-operative Group Ltd, but operates independently from the dairy giant.
The New Zealand milk co-operative, which is owned by about 10,500 farmers, controls nearly a third of the world dairy trade.
US-listed CRA International Inc is the trading manager for the Global Dairy Trade auctions. A number of companies, including Dairy America and Murray Goulburn, use the platform to sell milk powder and other dairy products.
The next auction is scheduled for Jan. 15.
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