Oceania Dairy Market Overview

MADISON - Aug 18/05 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The new milk production season continues to develop in
Oceania.  Although it is still very early in the season, New Zealand producers
and handlers are projecting a 4 - 5% increase over last season.  This will
bring production back in line to slightly higher than two years ago. In
Australia, producers and handlers are hopeful to continue the gains that they
have experienced at the end of the 2004 - 2005 season.  Production data for
eleven months (July 04 - May 05) in Australia indicates that cumulative output
was 0.4% ahead of the previous year.  Victoria, the major milk producing
region, is realizing a 2.8% cumulative increase over last year for the eleven
month period, although production in New South Wales and Queensland is down
4.6% and 8.9%, respectively.  At this point, Australian production projections
for the 2005 - 2006 year are 1 - 1 1/2% above last year with much of this
projection dependent on weather conditions.  Traders and handlers report that
stocks of the 04/05 year are getting quite low.  As has been the case for much
of the year, stocks have been fully committed to regular and ongoing customer
needs.  As the season ends, stocks are very minimal and most report that they
have nothing available for end of season sales.  Producers and handlers are
reviewing their pricing structures and prices are holding steady to slightly
firmer as the new season begins.  Traders indicate that new customers are
looking for product from the region and, for the most part, are not committing
to this buyer interest.  Currently, suppliers and traders are maintaining a
very conservative approach to their upcoming production and filling their
regular and ongoing customers needs.

0930c steve Schneeberger  (608)224-5084

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STAT News Service