Oceania Dairy Market Overview

MADISON - Jun 8/06 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The 2005 - 06 milk production season in New Zealand has now
officially closed.  Early reports indicate that annual production finished the
season heavier that previously projected and will be nearly 4% ahead of last
year.  Producers and handlers state that production momentum during the second
half of the season was the main factor for the strong finish.  Many are
hopeful that the strong finish will carry over into a positive start for the
new season.  In Australia, the current production season will come to a close
at the end of June, but will not be as positive as their New Zealand
neighbors.  Producers and handlers state that the last half of the season has
been basically opposite of the first half.  Positive first half gains eroded
during the second half.  As the season comes to a close, most milk handlers
are hopeful that the downward trend will not surpass a 1% decline when
compared to last season.  For the most part, Oceania suppliers are fairly
comfortable with their stock situation as winter season sets in.  Some state
that they may need to reach to pre-arranged outside supply sources to fully
meet their commitments, but these additional volumes should be minimal.
Manufacturing facilities New Zealand have basically ceased operations with
milk volumes clearing through drinking milk operations for the next two months
or so.  In Australia, manufacturing facilities are reducing production
schedules and closing operations as milk volumes decline.  In both countries,
this will allow time for annual plant maintenance before the startup of the
new production season.

0930c steve Schneeberger  (608)250-3204

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STAT News Service