Oceania Dairy Market Overview

MADISON - Oct 27/05 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  Unseasonably cool weather over the past two weeks or so in
New Zealand has impacted milk production.  Wet conditions, including some
flooding, on the North Island have caused the spring milk peak and decline
from the peak to occur a few weeks earlier than normally expected.  In the
South Island, dry conditions are also providing less than ideal pasture
conditions for milk production.  This places more pressure on output after the
spring peak to make up the difference.  Milk intakes in New Zealand are again
unlikely to recover to levels of just a couple years ago.  Manufacturing
plants continue to operate on seasonally heavy schedules.  In Australia, milk
production continues to increase seasonally with the annual spring peak a few
weeks away.  Some rains have been occurring in the major dairy areas such as
Victoria.  Water allocations for irrigation have been increased in Victoria,
though not to pre-drought levels.  Production of manufactured products
continues toward items pre-sold before the season with some extra being
inventoried.  Sales staff is still looking to increase sales for the next
calendar year but are not desperate to sell product due to continued milk
production concerns in New Zealand.  Strong currency exchange rates compared
to the US Dollar remain a concern for international traders.  Manufacturing
schedules are already lighter than a few weeks ago in New Zealand though still
increasing in Australia.

0930CGeorge Koerner 608.224.5083

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STAT News Service