June 17, 2025 • 4 mins
Jarden's Head of Commodities comment's on last night's GDT Auction - the second of the new 25/26 season - down 1% (WMP down 2.1%). Plus we ask if Fonterra was too optimistic with its $10 opening forecast milk price.
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Episode Transcript
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Speaker 1 (00:00):
In the past life he was the head of derivatives.
(00:02):
These days he's got a new job title. I wonder
if it came with a pay rise for Mike McIntyre
out of Jardin head of Commodities. Which is the Is
that a promotion, Mike or a relegation?
Speaker 2 (00:12):
Good afternoon, Yeah, afternoon, Jammie. I'm not sure. Actually, I've
never questioned it, but you know, it's one of these
ones where change as good as a holiday.
Speaker 1 (00:19):
As I say, well, head of commodity sounds pretty cool
to me. Look, the Global Dairy Trade auction last night
down one percent, whole milk powder down two point one percent,
skim milk powder one point three butter and cheese. The
fats are sort of saving the day. And while this
wasn't a great result on the face of it, it
was a lot better than the futures market was picking.
Speaker 2 (00:40):
Ye, that's right. So the features were as we're looking
at one stage, as much as four percent of both
skim and home milk powder, and even the facts as
you say, we were forecasted to fall in the case
of butter didn't. But for my side of things, you know,
the third one in a row now and we yet
to face the increase in volumes that come with this
time of the year. So I just wanted to it's
(01:00):
sort of giving buyers an excuse to set to the
sidelines like we've seen in the previous couple of years.
And the just one caveat i'd give to that is
obviously that strategy has been unsuccessful. But you know, I
think they'll be looking at what's happened in New Zealand
cow and pass your condition and great you know, in
great condition, you're seeing feed prices at record lows almost
(01:20):
in regard to the milk price. And then the weather.
You know, we've obviously had some decent rainfall back end
of the season, which should sort of set fumbers up
pretty nicely for the new year. So I'm wondering if,
in contrast to the previous two seasons, they thinking we're
going to have a good start this year.
Speaker 1 (01:35):
Was Fonterra a bit ambitious to come out with an
opening shot of ten dollars and not stick to the
mathematical midpoint of nine dollars fifty.
Speaker 2 (01:45):
No, I don't think so. I think ten dollars was
a fair reflection of where were sitting in probably where
we still remain sitting. I think the eight dollars is
what the buyers will be seizing on. You know, they'll
be sitting out there thinking we're saying to themselves, you
know FETA and know that we don't, and so it
may give them a little bit of an excuse to
sit back and wait and see what volume comes once
(02:06):
we get through to the peaks. But at the same time,
as I said, you know that that strategy has been
unsuccessful in the previous two times, where we saw prices
start to take off, and you know, buyers are jumping
over themselves in order to get volume on board. So
you know, if I was a buyer at these sort
of levels now, I would certainly be cautious in terms
of pain what has in the past been record highs,
(02:28):
but I'd certainly be going along with with what, you know,
with what ingredients I needed to continue my manufacturing.
Speaker 1 (02:35):
Let's have a look at homework power. China bought less,
but the Middle East brought more. Mind you, the Middle
East got a bit more money now that war is
brewing between Israel and Iran. Oil prices are shooting up,
you know, more disposable income.
Speaker 2 (02:48):
Mike, I think something you know oil has spoken about
has been the king of commodities, and so where oil goes,
if it is in a more sustained fashion, then the
rest go. And so we have seen in the past
strong correlation between Derek's modoity prices and oil prices. I mean,
this might only be a temporary blip, although we've seen
today posts to the US closes oil prices jump another
(03:10):
five percent. So you know, does that mean that Deiry
goes with it? Possibly? Certainly. The Chinese are key to
us in terms of homeworkpowder. What I would note is
that unusually the Middle East brought a lot of butter
this time as well, so I'd say they were the
reason for the prices continuing to head higher. And you know,
(03:31):
as I put them on note, I think it's really important,
as we've done in the past couple of seasons, that
why the demand for homework powder comes out of China.
It might be a bit softer at this time of
the year because the demand's not there that we do,
you know, we meet all that demand in the creams
and fat market and send milk in that direction. While
the prices are remaining at elevated levels.
Speaker 1 (03:49):
How much longer can butter and cheese the fats to
fire logic. Logic, let me try that again to fire gravity.
Speaker 2 (03:56):
Yeah, I think through into Christmas. So it's goot for
us at this time of year because our production won't
really ramp up until September, maybe even start of October.
So getting that product into market in the Northern Hemisphere
before Christmas is going to be a tough ask. But
as I said, any sort of milk at the margin,
that's certainly where you'd be putting it into the cream
streams and then sending it to the Norman hemisphere as
(04:18):
quickly as possible. You know, it's just unfortunate that's you know,
their demand coincides with a low period in our in
our production. But you know, I think we should try
and obviously make the most of what's available to us.
Speaker 1 (04:30):
Mike McIntyre out of Jardin, thanks for your time. You're
into the predictions game, Chiefs or Crusaders. I'm hoping for
the cheats.
Speaker 2 (04:37):
Yeah, I'm saying, you know, I like you exciting soil
a play they got, and you know Crusades they're just
agreed for the last twenty years, haven't they. So'd be
great to see a new name on the cup.
Speaker 1 (04:47):
Absolutely thanks for your time.
Speaker 2 (04:49):
Thanks Jamy,
In the past life he was the head of derivatives.
(00:02):
These days he's got a new job title. I wonder
if it came with a pay rise for Mike McIntyre
out of Jardin head of Commodities. Which is the Is
that a promotion, Mike or a relegation?
Speaker 2 (00:12):
Good afternoon, Yeah, afternoon, Jammie. I'm not sure. Actually, I've
never questioned it, but you know, it's one of these
ones where change as good as a holiday.
Speaker 1 (00:19):
As I say, well, head of commodity sounds pretty cool
to me. Look, the Global Dairy Trade auction last night
down one percent, whole milk powder down two point one percent,
skim milk powder one point three butter and cheese. The
fats are sort of saving the day. And while this
wasn't a great result on the face of it, it
was a lot better than the futures market was picking.
Speaker 2 (00:40):
Ye, that's right. So the features were as we're looking
at one stage, as much as four percent of both
skim and home milk powder, and even the facts as
you say, we were forecasted to fall in the case
of butter didn't. But for my side of things, you know,
the third one in a row now and we yet
to face the increase in volumes that come with this
time of the year. So I just wanted to it's
(01:00):
sort of giving buyers an excuse to set to the
sidelines like we've seen in the previous couple of years.
And the just one caveat i'd give to that is
obviously that strategy has been unsuccessful. But you know, I
think they'll be looking at what's happened in New Zealand
cow and pass your condition and great you know, in
great condition, you're seeing feed prices at record lows almost
(01:20):
in regard to the milk price. And then the weather.
You know, we've obviously had some decent rainfall back end
of the season, which should sort of set fumbers up
pretty nicely for the new year. So I'm wondering if,
in contrast to the previous two seasons, they thinking we're
going to have a good start this year.
Speaker 1 (01:35):
Was Fonterra a bit ambitious to come out with an
opening shot of ten dollars and not stick to the
mathematical midpoint of nine dollars fifty.
Speaker 2 (01:45):
No, I don't think so. I think ten dollars was
a fair reflection of where were sitting in probably where
we still remain sitting. I think the eight dollars is
what the buyers will be seizing on. You know, they'll
be sitting out there thinking we're saying to themselves, you
know FETA and know that we don't, and so it
may give them a little bit of an excuse to
sit back and wait and see what volume comes once
(02:06):
we get through to the peaks. But at the same time,
as I said, you know that that strategy has been
unsuccessful in the previous two times, where we saw prices
start to take off, and you know, buyers are jumping
over themselves in order to get volume on board. So
you know, if I was a buyer at these sort
of levels now, I would certainly be cautious in terms
of pain what has in the past been record highs,
(02:28):
but I'd certainly be going along with with what, you know,
with what ingredients I needed to continue my manufacturing.
Speaker 1 (02:35):
Let's have a look at homework power. China bought less,
but the Middle East brought more. Mind you, the Middle
East got a bit more money now that war is
brewing between Israel and Iran. Oil prices are shooting up,
you know, more disposable income.
Speaker 2 (02:48):
Mike, I think something you know oil has spoken about
has been the king of commodities, and so where oil goes,
if it is in a more sustained fashion, then the
rest go. And so we have seen in the past
strong correlation between Derek's modoity prices and oil prices. I mean,
this might only be a temporary blip, although we've seen
today posts to the US closes oil prices jump another
(03:10):
five percent. So you know, does that mean that Deiry
goes with it? Possibly? Certainly. The Chinese are key to
us in terms of homeworkpowder. What I would note is
that unusually the Middle East brought a lot of butter
this time as well, so I'd say they were the
reason for the prices continuing to head higher. And you know,
(03:31):
as I put them on note, I think it's really important,
as we've done in the past couple of seasons, that
why the demand for homework powder comes out of China.
It might be a bit softer at this time of
the year because the demand's not there that we do,
you know, we meet all that demand in the creams
and fat market and send milk in that direction. While
the prices are remaining at elevated levels.
Speaker 1 (03:49):
How much longer can butter and cheese the fats to
fire logic. Logic, let me try that again to fire gravity.
Speaker 2 (03:56):
Yeah, I think through into Christmas. So it's goot for
us at this time of year because our production won't
really ramp up until September, maybe even start of October.
So getting that product into market in the Northern Hemisphere
before Christmas is going to be a tough ask. But
as I said, any sort of milk at the margin,
that's certainly where you'd be putting it into the cream
streams and then sending it to the Norman hemisphere as
(04:18):
quickly as possible. You know, it's just unfortunate that's you know,
their demand coincides with a low period in our in
our production. But you know, I think we should try
and obviously make the most of what's available to us.
Speaker 1 (04:30):
Mike McIntyre out of Jardin, thanks for your time. You're
into the predictions game, Chiefs or Crusaders. I'm hoping for
the cheats.
Speaker 2 (04:37):
Yeah, I'm saying, you know, I like you exciting soil
a play they got, and you know Crusades they're just
agreed for the last twenty years, haven't they. So'd be
great to see a new name on the cup.
Speaker 1 (04:47):
Absolutely thanks for your time.
Speaker 2 (04:49):
Thanks Jamy,
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