Fonterra Auction

Published 18 November 14

As the Fonterra Global Dairy Trade (GDT) auction is now held twice a month with varying intervals, this page has been changed to emphasise the price changes between auctions for different products. For further information on individual product details, please visit the Fonterra site by clicking here.

Auction summary for 18 November 2014:

The most recent auction showed a 3.1% decrease in the overall auction index. Cheddar, AMF (Anhydrous Milk Fat), Butter and BMP (Butter Milk Powder) showed an increase in price index compared to the previous auction. In contrast, the price index for Casein, WMP (Whole Milk Powder) and SMP (Skimmed Milk Powder) declined.

  • The average price for all products across all contracts now stands at US$2,561/tonne, the lowest price since August 2009.
  • The gDT TWI* fell by 3.1% compared to the previous auction.
  • The average weighted butter price was up 6% from the last auction, at $2,656/tonne.
  • WMP averaged $2,400/tonne across all contracts, a decrease of 5.1% on the last auction.
  • The weighted SMP price was down 5.7% from the previous auction, at $2,299/tonne. The average price for UK SMP was $2,240..
  • The price for Cheddar was up 5% on the last auction, at $2,861/tonne.
  • The AMF (Anhydrous Milk Fat) price increased by 6.1% from the previous auction, to an average of $3,490/tonne.
  • The BMP (Butter Milk Powder) price increased by 1.4% to $2,511/tonne.
  • Prices for Casein averaged $6,681/tonne, down 12.2% from the previous auction.

The next auction is due to take place on Tuesday 2 December 2014.


Changes in Price Indices

Contract 1

Contract 2

Contract 3

Contract 4

Contract 5

Contract 6

All Contracts







Anhydrous Milk Fat (AMF)


6.5% 6.1% 7.8% 3.9% 3.4% 6.1%



4.4% 11.3% 3.6% 3.5% n.a. 6.0%

Butter Milk Powder (BMP)


0.6% 4.9% n.a. n.a. n.a 1.4%

Cheddar (Ched)


12.2% 3.5% -1.2% n.a. n.a 5.0%

Rennet Casein (RenCas)


-12.4% -11.9% n.a. n.a. n.a -12.2%

Skim Milk Powder (SMP)


-7.0% -4.7% -1.2% -5.5% -3.2% -5.7%

Whole Milk Powder (WMP)


-4.8% -3.9% -8.7% -5.0% -4.0% -5.1%

All Products (Trade-Weighted)


-3.5% -2.2% -3.9% -1.4% -2.3% -3.1%


 Source: GlobalDairyTrade platform

Data marked with an “*” indicates that the reported change is computed relative to two trading events prior to the current event because no quantity was offered or sold in the preceding event. "n.a." indicates no quantity was offered or sold in either the current event and/or in the prior two events.

Fonterra Auction 

Notes to the auction

*gDT-TWI™ and All Products (WMP,AFM,SMP) TWI are chain-linked, trade-weighted Fisher indices using total international trade flows which represent the movement in auction prices between auction events. The indices use globalDairyTrade prices where available and USDA Dairy Market News prices elsewhere. USDA Western Europe average price for Butter Oil is used for AMF prior to December 2009, USDA Oceania average price for SMP is used prior to April 2010, and USDA Oceania average price for WMP is used prior to August 2008.

The Fonterra auction takes place bi-weekly on an online trading platform called GlobalDairyTrade. It started on 3 July 2008. Fonterra accounts for more than a third of international dairy trade. Although Fonterra will only sell up to 20% of its commodities through this platform, sales results from GlobalDairyTrade provide a global benchmark for commodity prices.

Six contracts are made available, corresponding to future delivery periods. For example, 'contract period 1' provides for products where the shipment period is the first month after the month of the Trading Even and 'contract period 6' means that shipment begins six months after the trading event.

The use of six contract periods has been in effect since April 2012.

The auction always follows the same pattern. Five days before the start of the event, volumes available and starting prices are made public. During the trading, in each successive bidding round, the price is raised. Given the announced prices, bidders enter the volume they wish to purchase. This continues until the available volume is cleared, each customer staying in as long as they enter volume bids.