As can be seen overall trade weighted prices were down 2.5% - why?
Dairy Market News on October 14, 2010 said,:
In New Zealand, milk producers are returning to regular operations following adjustments that some farmers made to their operations following the heavy
snowfall on the South Island and wet conditions in most all other regions in recent weeks. These adverse weather conditions, at this time of the season, were stressful to the milking herd and breeding timelines. Some farmers adjusted their milk schedules to once a day to help maintain cow conditioning at this crucial time of the breeding season. Overall milk production is now back on track to steadily build toward season peak levels. Milk handlers are
speculating that this glitch, during the seasonal buildup, may take the bloom out of a higher seasonal peak than projected. Prior to the adverse conditions, milk production was running 1 - 2% ahead of last year, slowed during the inclement weather patterns, but is now once again on the uptick. This weather glitch has negatively impacted some production projections by as much as 2%.
Bloombergs blamed the drop on the latest "Milk Production" report, which came out exactly when the auction started. additionally, where is the product coming from that Fonterra is selling?
Hard to make heads or tails of the auction. Markets are supposed to move on information but, do they?