Oceania Dairy Market Overview

MADISON - Mar 29/07 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  Milk production in the Oceania region continues to decline
as lack of moisture continues to hinder milk output.  In New Zealand, milk
handlers state that milk receipts are falling off faster than projected.  Warm
temperatures and limited moisture are two factors milk handlers are
attributing to the accelerated pace of decline.  Although later season
production is dropping off at a faster pace than forecast, producers and
handlers remain optimistic that they will finish the season above board when
compared to last season.  Recent annual production projections were for a 1
1/2 - 2% increase over last season with recent conditions possibly lowering
this projection fractionally.  In Australia, dry conditions and lack of
moisture continue to curtail milk production.  In Victoria, reports of
scattered rainfall have been reported, although not sufficient enough to
replenish depleted moisture levels.  Producers state that any moisture is
welcomed at this point as it temperately causes pastures to green up.  Often
the moisture quickly dissipates by days of warm temperatures.  The supply
situation in both Australia and New Zealand is little changed from much of the
current production season.  Stocks have been and continue to be fully
committed to regular and ongoing customer needs with virtually nothing
available for additional customer needs or new buyer interest.  Many traders
and handlers are closely monitoring their supply situation in hopes of making
it through the current season with known commitments on the books.  There are
reports of some suppliers and customers already looking toward the new milk
production season for supply availability and needs.  Traders state that
customers are very concerned about product availability in the new season and
are talking with suppliers about their needs.  In instances, some of this
buyer inquiry is being acknowledged.  Most Oceania manufacturers, handlers,
and traders feel that international product availability will remain short of
full needs well into the 2007 - 2008 year with prices remaining equally firm.

0930c steve Schneeberger  (608)250-3204

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STAT News Service