The latest Global Dairy Trade (GDT) Event 402 held on April 21, 2026, extended the recent correction in global dairy markets, with the GDT Price Index declining by approximately –2.7%, marking the second consecutive drop after the strong rally seen earlier this year. The average winning price is estimated to have eased to around USD 4143 per tonne, reflecting softening buyer sentiment and cautious procurement strategies.

Key Commodity Results (Event 402)

Anhydrous Milk Fat (AMF): USD 6,357/tonne (–9.6%)
Butter: USD 5,702/tonne (–7.9%)
Butter Milk Powder (BMP): n.a. (not traded)
Cheddar Cheese: USD 4,798/tonne (+1.1%)
Lactose: USD 1,573/tonne (+7.2%)
Mozzarella: USD 3,850/tonne (–3.1%)
Skim Milk Powder (SMP): USD 3,448/tonne (+3.2%)
Whole Milk Powder (WMP): USD 3,666/tonne (–0.6%)

Total traded volumes are estimated at around 17,000–18,000 tonnes, slightly lower than previous events, indicating reduced participation intensity. The decline comes despite continued seasonal tightening of milk supply in Oceania, reinforcing that demand-side caution and inventory overhang are now dominating price direction.

Key Takeaways (Quick Insight)

Fat products (AMF, Butter) saw sharp corrections, driving overall index weakness
Powders diverged: SMP strengthened (+3.2%) while WMP remained almost flat
Cheese stable, showing resilience in foodservice-linked demand
Lactose surged, indicating strong demand from infant nutrition / pharma segments

The primary driver behind the index decline is the high level of carryover stocks in Europe and the United States, built during the oversupply phase of 2025. These inventories are acting as a ceiling on global prices, discouraging aggressive bidding. Additionally, buyers who had actively restocked during the February–March rally are now shifting to short-term, need-based procurement, reducing urgency in auctions.

On the demand front, traditional importers such as China remain stable but cautious, while Southeast Asia, Middle East and African markets continue to emerge as consistent buyers. However, demand from these regions is increasingly fragmented, with smaller and more frequent purchases replacing large-volume contracts. This shift has reduced price momentum despite underlying consumption stability.

Geopolitical tensions continue to play a complex role. The ongoing conflict and uncertainty around critical trade routes such as the Strait of Hormuz have increased freight costs and logistical risks. However, unlike earlier auctions where buyers engaged in panic buying, the current phase reflects post-risk adjustment, with importers managing inventories more efficiently. If disruptions intensify, particularly affecting energy supplies and shipping lanes, a renewed price spike cannot be ruled out due to supply chain shocks.

Looking ahead, the next 2–3 months are expected to remain range-bound to slightly bearish. SMP and WMP may face continued pressure if Chinese demand does not strengthen meaningfully. Butter and AMF could remain volatile due to inventory swings in developed markets. Seasonal declines in New Zealand milk production may provide some support, but overall upside appears limited without a fresh demand trigger or supply disruption.

Trend Since Beginning of 2026

The GDT index has shown a two-phase movement in 2026. The year began with a strong recovery, with prices rising consistently through January, February and early March, gaining over 18% cumulatively and peaking around early March (Event 399). This rally was driven by tight supply and aggressive restocking. However, since early April (Event 401 onward), the market has entered a correction phase, with two consecutive declines (Events 401 and 402), signalling a transition from recovery to consolidation as demand normalises and inventory pressures resurface.

Overall, GDT 402 confirms that the global dairy market is moving into a balancing phase, where price direction will depend more on demand confidence and geopolitical developments than on supply tightness alone.

Source : Analysis of GDT auction by Kuldeep Sharma April 22nd 2026 Dairynews7x7

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