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GDT launches pilot version of GDT Pulse

27 July 2022

Global Dairy Trade (GDT) has been working on an exciting new development with Fonterra that aims to enhance liquidity in GDT for the benefit of both buyers and sellers by providing price discovery on a more frequent basis, called GDT Pulse.

We are pleased to announce a pilot version of GDT Pulse is ready for launch, and the first GDT Pulse auction (PA001) is scheduled for 1200 UTC on 9 August 2022. 

Fonterra will confirm the planned supply for the pilot period later today via the GDT Events Market Announcement to NZX and GDT Events Bidders.

Changes within the GDT Trading Event Rules to accommodate GDT Pulse will become effective on 3 August 2022.

Summary of the GDT Pulse pilot

A pilot version of GDT Pulse has been developed, offering sufficient features to meet customer needs, with further development to be informed by customer feedback.  

Initially, GDT Pulse will offer auctions on alternate weeks between GDT Trading Events for a period of six to twelve months. The auctions will offer one product specification to bid on: Fonterra Whole Milk Powder Regular, Contract Period 2. This will ensure a short total duration of 15 – 30 minutes, providing a convenient option for bidders.

The pilot will allow GDT to validate whether:

  • There is a credible level of participation
  • Credible prices are published
  • Trading has increased in the dairy futures market

Prices discovered through the GDT Pulse auctions will be complementary to the price discovery provided by GDT Events.

GDT Events will continue to be the large volume, high liquidity events that the dairy industry watches, while GDT Pulse intends to provide interim price discovery for core commodity products between the GDT Events auctions.

The following key metrics will be displayed via a new page under the existing Results tab on the GDT website immediately following the first GDT Pulse auction:

  • Whole Milk Powder average price
  • Number of winning bidders
  • Number of participating bidders
  • Number of bidding rounds
  • Duration of GDT Pulse auction
  • Minimum supply (MT)
  • Maximum supply (MT)
  • Quantity sold (MT)

From the second GDT Pulse auction, Whole Milk Powder Average Prices will be displayed as a graph view and a historical data file capturing the above-mentioned key metrics will be available for download. 

After the pilot period, GDT will assess the merit of GDT Pulse and the future potential for more frequent price discovery from Global Dairy Trade.

If the pilot is deemed successful, it is envisaged that GDT will invest in platform upgrades to enable scalability of the service offering and the potential for daily auctions.  Other sellers will be invited to offer products at this time.

A more detailed overview of the GDT Pulse pilot and frequently asked questions (FAQs) is available here.

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