Oceania Dairy Market Overview

MADISON - Aug 31/06 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The new milk production season is just underway in
New Zealand with cows continuing to freshen.  Milk volumes produced
are increasing seasonally toward the peak intakes expected at least in
late October or early November during the spring season.
Manufacturing plant receipts are also growing seasonally.  The report
of previous season butter destined for the EU being resold elsewhere
is incorrect.  This product is being placed into bonded warehouses in
Europe, pending the resolution of the matter.  Also, the planned
product mixture for using early season milk intakes in New Zealand has
not adjusted because of the EU butter situation.  Early season weather
conditions are currently fine for the continued increase in milk
production.  Some product continues to be shipped from inventory to
fill previously placed customer orders.  In Australia, it is also the
low point in the milk production cycle during the winter months.
Current winter weather conditions are about normal.  Thus far, winter
rains have generally been disappointing and have dimmed the prospect
for the upcoming season.  However, there are still a few more weeks of
winter left to help make up some of the difference.  Most activity
centers on shipping product left in inventory and putting together
deals for the approaching production season.  Australian July 2005 -
June 2006 milk production is estimated at 10,087.0 million liters,
down 37.8 million liters, (-0.4%) from the previous year.


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