The online trading platform’s increased growth has been driven strongly by skim milk powder products.
Source: Global Dairy Trade
GlobalDairyTrade (GDT), the online trading platform for international dairy commodities, surpassed sales of 1 million metric tons of dairy products during the past 12 months.
GDT Director Paul Grave says the milestone reflects consistent strong growth in volumes from its sellers, particularly non-Fonterra sellers who have doubled their volumes in each of the last two years.
"One million tons represents a 27% increase in quantity sold over the last two years, which has been achieved despite an environment of sustained high dairy prices. This quantity of product, traded to such a wide group of buyers across 90 countries worldwide, reinforces the credibility of the market prices established through GDT auctions."
With the addition of Land O’Lakes (one of America’s largest dairy cooperatives) to its roster of sellers in March 2014, GlobalDairyTrade now offers 40 product specifications from seven sellers spanning Europe, US, Oceania and India.
"We continue to attract sellers who see GlobalDairyTrade as the way of the future for international trade, and buyers who value the product access offered by GDT, along with the assurance of paying a fair market price," Grave said. "The ease with which we can connect sellers with buyers, and the efficiency of the online trading approach, are reflected in the strong volume increases."
The growth in overall volume has been driven most strongly by the skim milk powder product group, which represents 45% of the growth over the last two years.
The range of products sold via GDT has expanded further in the last six months with the introduction of British skim milk powder and butter milk powder from Arla Foods, and lactic butter from DairyAmerica. GDT now lists skim milk powder from six sellers, offering customers a wide choice of specifications and origin for their ingredients needs.
Sellers can offer product in six monthly shipment periods, so at any trading event bidders can choose to purchase product for shipment over the following six months, providing them with an effective tool for managing contract price risk.
GDT is open to all qualified buyers and sellers in the market. It operates at arm’s length from its owner Fonterra with twice-monthly auctions conducted on behalf of GDT by CRA International,
Inc., a Boston-based publicly-traded (NASDAQ: CRAI) consulting firm in accordance with market rules overseen by an independent advisory board of sellers and buyers.
Brad Miller, head of the Trading Manager team at CRA International, says that the GDT platform is a win-win for buyers and sellers. "It provides valuable, credible market information which enables participants to make better business decisions, manage risk better, and utilize their resources to the highest-valued uses. Fundamentally the platform lowers information and transactions costs, creating more value for both buyers and sellers."
"We are looking forward to further growth over the next year," Grave said, "in terms of sellers, the range of products we offer, and continuing enhancements to our technology platform."