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Shares in dairy producers listed in Australia and New Zealand rose on Wednesday despite global the price of milk products dipping to an eight-month low overnight.
Shrugging off the fall in prices, A2 Milk was the best performer on S&P/ASX 200 in Sydney in early trade, lifting 5 per cent, while on the NZX, Synlait Milk added 2.2 per cent and on Fonterra, was up 0.2 per cent.
The moves came after the Global Dairy Trade index – the industry benchmark reflecting the latest fortnightly auction prices – fell 3.4 per cent on Tuesday, including a 2.7 per cent drop in the price of whole milk powder. That marked the fourth straight decline for the index and the lowest price since March.
Fonterra, the world’s biggest dairy producer, said on Tuesday that total milk production in New Zealand in October – the typical supply peak – was up 3 per cent compared to the year prior.
The share price lift continues a banner year for dairy producers. A2 Milk, which on Tuesday reported a 68.9 per cent jump in unaudited revenue for the fourth months to October, is now up 306 per cent so far this year. Synlait is 143.7 per cent higher and Fonterra is up 5.5 per cent.