Oceania Dairy Market Overview

MADISON - Feb 2/06 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The Oceania milk production season continues to wind
down seasonally.  In New Zealand, milk production trends have been
trailing last year by about 2%, but recent reports indicate that this
negative margin might be narrowing.  At this point, milk producers and
handlers feel that the negative margin will probably not be
eliminated, but will at lease become less.  In Australia, milk
production on a cumulative basis for the first five (5) months of the
milk production year (July - November) was up 0.5%.  On a cumulative
five month basis, milk output in Victoria, the major production area
of Australia, was up 0.8% followed by a 1.3% increase in New South
Wales and a 1.4% increase in Queensland.  Many milk handlers feel that
this trend will probably hold true for December, but recent hot
temperatures in major milk production areas may greatly reduce the
volumes for January.  Manufacturing schedules remain seasonally
active, although these are declining as milk volumes decrease.  Stocks
of manufactured dairy products are in balance for needs, with minimal,
if any available for spot or new buyer interest.  Traders and handlers
feel that if they need additional volumes to round out their
commitments, they will be able to reach to outside sources for that
supply.  Sales or market activity continues to center around regular
and ongoing customer needs.

0930c steve Schneeberger  (608)250-3204

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STAT News Service