Dry summer pushes up world dairy prices

Dry conditions in the North Island helped drive milk product prices higher at the latest fortnightly global dairy auction, but ongoing strength in the New Zealand dollar is acting to take the cream off the top for farmer returns, economists said.

Overall, dairy prices rose 3.1 per cent on a trade-weighted basis in the auction, held overnight.

The increase builds on the buoyant start to 2013 in the first three auctions of the year.