Business / Country

Dairy prices fall again

08:38 am on 7 November 2018

Dairy prices have again fallen to the lowest level in more than two years in the latest global auction overnight.

Fonterra forecasts payout will drop by up to 50 cents a kg Photo: RNZ / YouTube

The average price was down 2 percent to $US2851 a tonne.

It is the lowest average price since mid-August 2016, and follows a marginal fall in the previous auction.

The price of whole milk powder, a key factor in setting returns to local farmers, fell nearly 3 percent to $US2655 a tonne.

The volumes sold were 1 percent higher.

Prices for the products offered were mostly lower, with only a modest rise for skim milk powder.

Fonterra last month cut its forecast payout for the current season by up to 50 cents to between $6.25 and $6.50 a kilo of milk solids because of supply growing faster than demand.