Dairy commodity prices performed better than expected at the Global Dairy Trade (GDT) event overnight, easing just 0.3 percent.
There was a fall in whole milk powder (WMP) prices, but prices for both butter and anhydrous milkfat (AMF) lifted, while skim milk powder (SMP) was unchanged.
WMP prices had been expected to fall. Last week Fonterra lifted its milk production forecast for the season and increased the volume of WMP it intends to offer on the GDT platform over the next three months.
NZX Data Dairy Anaylst Amy Castleton said WMP was a little more resilient than anticipated.
"WMP eased 0.9 percent overall, while regular grade WMP to ship in December eased 0.7 percent, a little less than was anticipated by the NZX Dairy Derivatives market ahead of the event," she said.
Butter prices lifted 2.4 percent overall.
"This is the first lift we've seen in the butter price index since June," said Ms Castleton.
The price for unsalted butter to ship in December jumped 5.1 percent which was a much better result than expected.
AMF lifted 1 percent overall. The price for regular grade AMF to ship in December lifted 3.5 percent, again a better result than expected. The derivatives market had anticipated a 1.2 percent rise in this grade and contract of AMF ahead of the event.
"Demand for milkfats has been fairly solid, but the available supply seems have been outweighing demand in recent months," said Ms Castleton.
She said the GDT result will spur hopes that a corner has been turned in the milkfat market but said it is too early to say whether prices will continue to rise.
SMP prices were unchanged. The price for medium heat SMP to ship in December lifted 0.5 percent. The derivatives market had expected a flat result for this grade and contract of SMP ahead of the event.
"There seems to be good demand for fresh SMP from Oceania, which is keeping prices steady. Little movement in SMP prices is expected for a few months yet," she said.