Dairy commodity prices have fallen again, as volumes of whole milk powder build.
Prices fell 1.9 percent at the Global Dairy Trade (GDT) event overnight on Tuesday.
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The average price was US$2934 a tonne, compared with US$2980 a tonne two weeks ago.
New Zealand's key commodity, whole milk powder (WMP) came down 1.2 percent.
NZX Agri dairy analyst Amy Castleton said a decline had been expected, as volumes of WMP are building at this time of season as NZ heads into its peak milk production period.
"However the price for regular grade WMP to ship in December did lift 1.3 percent, she said.
"The NZX Dairy Derivatives market had been expecting a 0.4 percent decline in this grade and contract of WMP."
North Asia (which includes China) bought more than half of the WMP that was sold.
"China is likely to be buying product to ship in December at this time so that it lands during the period in which a lower tariff rate applies, from January 1, 2019," said Ms Castleton.
Milkfats led the way down, with the butter price index falling 5.9 percent and the anhydrous milkfat (AMF) price index falling 4.4 percent.
Unsalted butter to ship in December fell 6.4 percent.
Ms Castleton said this was a much greater fall than anticipated.
"The Derivatives market had priced in a 1.5 percent fall in this grade and contract of butter," she said.
The decline in prices for the milk fat products seems to simply be on greater volumes – there was more butter and AMF sold at this event than at the October 3, 2017 event.
The skim milk powder (SMP) price index eased 0.3 percent.
Medium heat SMP to ship in December lifted 3.1 percent however, which was aligned with Derivative market expectations.
"Demand for fresh SMP from Oceania has been solid, which seems to be holding prices relatively steady," said Ms Castleton.