Oceania Dairy Market Overview

MADISON - Jun 23/05 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The dairy situation in Oceania has changed little in recent
weeks.  For the most part, the 2004 - 2005 milk production season has come to
an end.  The milk production year in New Zealand runs from June through May
and unofficial reports continue to indicate that output trailed last season by
3 - 4%.  In Australia, the production year runs from July through June, thus
there is still a little time left in the current season.  The most recent milk
production data, through April, indicated that cumulative production for the
first ten months of the year is even with last year.  Victoria, the major milk
production region of Australia, realized a 2.4% cumulative increase for the
ten month time period.  Milk producers and handlers were quite concerned about
the impact minimal moisture may have on end of the season production.  For
much of May, conditions remained dry, but during recent weeks, some rainfall
did occur which helped moisture conditions somewhat.  Producers and handlers
remain optimistic that annual output will be even with last year.  Stocks of
manufactured dairy products remain in very close balance to short of full
needs.  Suppliers and handlers indicate that they may need to reach to multi-
origin sources and possibly into early months of the new milk production
season to fully fill existing commitments.  At this point, Oceania traders and
handlers state that international buyer interest is limited.  Traders continue
to monitor what is happening in Europe, especially what impact the most recent
cut in export subsidies and post July 1 developments may have on international
markets.

0930c steve Schneeberger  (608)224-5084

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STAT News Service