After the latest Global Dairy Trade (GDT) auction, Fonterra Managing Director Global Ingredients Kelvin Wickham tweeted the following, responding to the Twitter conversation around the latest result:
“No one likes low prices but important to remember GDT has not caused low prices – they’re a reflection of what’s happening in the market.
“Nearly all of the product offered on GDT this week sold to willing buyers.
“There is a supply / demand imbalance – and that’s what you’re seeing on GDT.
“Particularly, constraints on demand from big dairy importing countries (China slowdown and inventories, Russia import bans) …and milk supply continues to grow in Europe and USA which is spilling over into soft global demand.
“We’re doing everything to move powder and other commodity products into higher value contracts and higher margin products.
“And to those calling for GDT to be suspended, that’s not going to solve the supply/demand imbalance.
“Thanks - during this time we’ve got to pull together as a Co-op and support our farmers. Demand will come back.”