The price index fell once again due to an increase in global milk yield volumes and dairy products outpacing demand, according to Georghii Kukhaleishvili, analyst at the Association of Milk Producers (AMP).
The 391st GDT (Global Dairy Trade) auction took place on Tuesday, November 4th. The results showed that the price index was 1135, which is 2.4% less than the previous auction. The average price for dairy products was $3,768 per tonne, a decrease of $113 compared to the previous auction. 40,621 tonnes of commodity products were sold during the trading, which is 1,113 tonnes less than the previous auction. The minimum offer was recorded at 35,875 tonnes, and the maximum was 43,190 tonnes. 146 dairy market operators participated in the trading, which is 19 companies fewer than on October 21st.
Based on the auction results:
The price for Anhydrous Milk Fat (AMF) was $6,887 per tonne, which is 1.9% less than the previous auction. According to the USDA, milk fat prices in Europe declined in October amid weak market demand and increased cream supply. Oceania has a significant milk fat supply due to rising milk volumes in New Zealand. According to the GDT forecast, AMF may decline by 3% in January 2026.
The price for Butter at this auction was $6,371 per tonne, which is 4.3% less than the previous auction. According to Farmer’s Journal, the situation in dairy markets was more stable last week, and butter prices in Europe did not decrease. Over the last ten weeks, butter prices in the EU have fallen from €7,000 to €5,040 per tonne. As reported by the USDA, European butter demand in export markets was slow in mid-October, except for some purchasing activity from buyers in the Middle East and Asia. In Oceania, butter prices were falling in mid-October amid rising product volumes due to increased milk yields in New Zealand and slow export demand.
According to the USDA, lower butter prices in the US are boosting demand from the food industry and consumers. As reported by Newsbreak, butter consumption is growing in the US because consumers trust traditional fats more, moving away from substitutes. American restaurants with sophisticated, unique recipes have made butter a popular and desirable product for home use. Export demand for American butter is stable, and stocks in warehouses are growing. The USDA reports that the exception is 82% fat butter, as export demand for this product outpaces production volumes in the US. Auction organizers expect butter prices may fall by 4.8% in December and 5.5% in January 2026.
The price for Whole Milk Powder (WMP) was $3,503 per tonne and decreased by 2.7% compared to the previous auction. According to the USDA, WMP prices are falling in the US, Europe, Oceania, and South America amid increased raw milk production volumes and delayed demand in export markets, which are unable to quickly absorb such a large supply of the commodity. According to Farmer’s Journal, WMP prices in Europe have dropped by €155 since the previous GDT auction.
Despite increased milk yields in New Zealand, the New Zealand cooperative Fonterra plans to pay farmers 10 New Zealand dollars per kg of milk solids, which is considered a high price by local standards. According to Farmers Weekly, New Zealand dominates the global WMP market, with its share in production at 60%. Therefore, even a small increase in production volumes in New Zealand noticeably affects prices. Auction organizers forecast a price reduction for the commodity of 2.5% in December and 2.9% in January 2026.
The price for Skim Milk Powder (SMP) was $2,559 per tonne and remained unchanged from the previous auction. According to Farmer’s Journal, SMP in the EU fell by €40 since the last auction. However, as reported by the USDA, prices for the commodity in the US, Oceania, and South America were relatively stable, as was demand. According to the GDT forecast, the commodity may decline by 0.2% in December but increase by 0.2% in January 2026.
Cheddar Cheese fell to $4,449 per tonne (-6.6%), and Mozzarella Cheese increased to $3,306 per tonne (+1.6%). According to Farmer’s Journal, prices for European-made Cheddar cheese did not change last week. Irish cheesemakers have accumulated significant cheese stocks, especially aged cheese made six months ago, which is now difficult to sell. According to the USDA World Markets and Trade report, Europe dominated the cheese market in 2024, with EU production growing by nearly 1%, reaching about 10.5 million tonnes. Germany, France, Italy, the Netherlands, and Poland account for almost 75% of all cheese production in the EU. According to sellers, demand for European cheeses in the US was active last week. European cheese varieties are currently more competitively priced on the world market, which strengthens demand in export markets. In mid-October, Cheddar prices in Oceania strengthened in the lower range but weakened in the upper range. There is a balance of supply and demand in the Oceania cheese market, and export prices have decreased amid increased commodity supply on the world market.
As reported by the USDA, cheese production volumes are growing in the US due to a significant raw milk supply. According to Newsbreak, Americans increase milk consumption by 5 pounds (2.27 kg) annually, primarily through cheese, despite a reduction in drinking milk consumption. Cheddar remains the most popular cheese in the US. The US cheese industry is expected to reach about $62.66 billion by 2032, thanks to the widespread use of cheese in popular fast-food dishes like pizza or sandwiches. The popularization of Italian and Mexican cuisine also influences cheese consumption. American cheese producers successfully compete on the world market. With the popularization of European and American cuisine, cheese consumption naturally increases as people consume dishes where cheese is a key ingredient. At the same time, according to the USDA, export demand for American cheese slowed last week, and sellers do not expect sales to pick up until after the New Year holidays. Auction organizers expect Cheddar cheese may decline by 7.1% in December and 6.9% in January 2026, while Mozzarella cheese may increase by 1.6% in January 2026.
Buttermilk Powder (BMP) increased to $2,808 per tonne, which is 1% more than the previous auction. According to the USDA, BMP demand is stable in export markets. Product stocks are sufficient in American warehouses to cover demand, but there are no surpluses. Auction organizers forecast a price increase for BMP of 8.4% in December but a decrease of 0.6% in January 2026.
The next GDT auction will take place on November 18th.