Oceania Dairy Market Overview

MADISON - Dec 8/05 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  Milk production continues to ease seasonally lower in
New Zealand after a less than robust start.  Cumulative milk receipts
for the current season continue to run about 2% below last season.
Local forecasts persist that the late season milk receipts are
unlikely to make up for the lower than expected early season and peak
levels.  Much of the current price adjustments are attributed to
changes in currency exchange rates.  Current products being emphasized
are powders for delivery in 2006.  With current season milk receipts
lower, manufacturing is also targeted toward producing and
inventorying products needed for late and off-season deliveries.
Current dairy product output is in relatively close balance with short
term demand.  Warm summer weather along with adequate precipitation is
keeping pastures in good summer condition in the major milk producing
areas of Australia.  Overall, milk volumes are declining seasonally
from the annual peak.  Thus far for the current season, milk receipts
are up about 1% from a year ago.  Inventories remain light with most
early season shipments made against commitments made earlier.
Interest is strong in agricultural topics for the rapidly approaching
Hong Kong WTO meetings.  Short term international interest is light as
many buyers wait until the New Year and any WTO developments before
making new commitments.

0930c George Koerner 608.224.5083

---

STAT News Service