Kelvin Wickham, Fonterra MD global trade, said the increase in frequency was a significant milestone that highlighted globalDairyTrade’s success as an online trading platform and as a credible price discovery mechanism.
“This will add more depth and credibility and even more transparency around pricing trends,” he said. “With a more frequent pricing signal, market participants will be able to have even more confidence they have up to date information on the current balance of supply and demand.”
Brad Miller, head of CRA’s auctions & competitive bidding practice, said: “globalDairyTrade has grown to 280 qualified bidders from 56 countries, an increase from 107 at inception. There are now between 100 and 140 active bidders participating in each event and around 65% of bidders joining the event win product. We’re pleased with the success of this innovative sales channel.”
Fonterra also announced that, beginning with the 3 August 2010 trading event, it will be adding one new product, Buttermilk Powder, and two new specifications of existing products: High Heat/ Heat Stable Skim Milk Powder and Anhydrous Milk Fat in 1,000kg bulk packs, to globalDairyTrade.
Wickham said globalDairyTrade continued to grow as an efficient and effective sales channel: “To date, we’ve sold 500,000 metric tonnes worth US$1.5bn on the platform.”
“We now trade four products: Whole Milk Powder, Skim Milk Powder, Anhydrous Milk Fat and Buttermilk Powder. The current forecast is to sell 530,000 metric tonnes of product over the next 12 months, or approximately 24% of Fonterra’s New Zealand production.
“With globalDairyTrade, Fonterra has taken a leading role in developing ways to manage the new price volatility in the markets for dairy products. We’re optimistic about the benefits the entire industry will get from a more open, transparent market.”
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