CSB - Stu Davison - GDT

Out of HighGround Dairy in Chicago Stu Davison joins us to look back at the latest GDT results. 

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Episode Transcript

Speaker 1 (00:00):
A Country Sport Breakfast with Brian Kelly on Gold Sport.

Speaker 2 (00:05):
Seventeen past seven o'clock Here on gold Sport in the
Country Sport Breakfast. Time to talk, as we do each
and every fortnight. Global Dairy Trade Ouction and Stud Davison
joins us out of Chicago.

Speaker 1 (00:15):
Mones Stew, Good morning. How are we.

Speaker 2 (00:17):
Good, mate? So overall prices are up, which is a
positive zero point four percent despite most analysts. I don't
know whether you did expecting a drop. Did you expect
to drop?

Speaker 1 (00:29):
Yeah, we were pricing to dropping for most of the products,
and we got it half right. We got the homwork
powder and the skim milk powder right. But the milk price, sorry,
the milk fat portion of things went against our expectations
and moved a little bit higher reminiscent of a bit
of bargain buying they're considering where milk fat values are.

Speaker 2 (00:47):
Yeah, funny old result. Really this one, isn't it When
you think that, you know it was up point four percent,
but the main things like whole milk powder, skin milk
down exactly exactly.

Speaker 1 (00:57):
It just shows you the power of AMF four one
hundred milk fair and cheddar in this situation, you know,
four percent and six point two percent respectively, pretty big shifts.
But again just that's the minor products during the most
of the lifting in this situation.

Speaker 2 (01:11):
So it looks like fairly sluggish demand from China, would
that be a fair summary?

Speaker 1 (01:17):
Yeah, exactly. They're continuing in the same sort of sluggish
results as we've seen in the last quite a last
eighteen months. To be honest, no real change on that front.
The real driver on this one was Middle East Middle
Eastern buyers increasing their purchases compared to the last auction,
and a little bit of stability from the Southeast Asian
Oceania buyers as well.

Speaker 2 (01:36):
So when you look at this result, what's the lemonade
you take out of the lemon here?

Speaker 1 (01:41):
Yeah. The lemonade on this one is that we're probably
seeing prices, especially Homwok powder price is going to continue
down the path we saw last year. So we're looking
at a similar slump that we saw last year. Maybe
not to the depths we measured last year, but definitely
the same direction as we move into August. So a
little bit further to go lower before things start to
turn around easonally on the powder side, But The positive,

(02:03):
you know, for the next few months is going to
be those milk fat prices. They're probably going to stay
relatively high, which is going to be pretty handy. So
keep that in mind as we see those home powder
prices slide.

Speaker 2 (02:12):
It would be nice to get China back in the market, really,
wouldn't it.

Speaker 1 (02:16):
Yes, exactly, that's what everyone's looking forward to and expecting,
and everyone's been written in reports that it's going to
happen sooner or later. But we remain pretty cautious macroeconomically
and politically. There's a fair few headwinds for the next
six months for China and we're not sure you know
how much of those things are going to weigh into
increased demand for dairy But lets be clear, they are

(02:36):
still buying. They're still buying pretty significant quantities. They're just
not driving prices like the historically would.

Speaker 2 (02:42):
I suppose when you look back a fortnite ago when
it dropped four point three percent, So to have a
plus instead of a mind, that's.

Speaker 1 (02:48):
A positive, exactly right, exactly right. It's not all bad
when you look at it that way. You know the
value of those milk fats are really happened to keep
the value of milk in New Zealand at a pretty
good little price.

Speaker 2 (02:59):
Nice all right, We do have a great day in Chicago.
Nice to catch up mate. We'll do it again in
a fortnight.

Speaker 1 (03:04):
Sounds good. Always good to chat. Thank you,