Oceania Dairy Market Overview

MADISON - Sep 13/07 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The 2007 - 2008 milk production season in
Oceania is building.  Early increases are being reported out of
New Zealand, although production growth is slow in developing.
Manufacturers and handlers indicate that conditions are quite wet
and sunshine is limited which is slowing pasture growth.  Milk
handlers state once sunshine is more prevalent and spring weather
conditions are established, they anticipate milk volumes will
increase more steadily and rapidly.  In Australia, the start of
the new milk production season is still a few weeks away.  At this
point, winter moisture has been variable.  In Victoria, the major
milk producing region in Australia, moisture levels range greatly.
In Northern areas of Victoria, winter rainfall has been limited,
while further south, moisture has been more prevalent and water
levels are in better shape, although often short of desired
levels.  In Gippsland, moisture has been quite abundant during the
winter season and pastures are wet.  Australian milk production
figures for July were released which indicated that output was
9.1% lower than July 2006.  This decline, though significant, is
not overly alarming milk handlers and manufacturers.  They
indicate that one must look at last year and remember that milk
output in July and August of 2006 was exceptionally strong which
quickly skews current year percentages.  Manufacturing schedules
are slowly increasing with plants in New Zealand ready to receive
milk volumes.  Australian plants remain idle as milk production
has yet to resume.  For those plants that are in operation,
finished product is not as plentiful as projected, thus early
season shipments are being adjusted and often delayed, to
accommodate lighter than anticipated stocks.  At this point,
traders and handlers state that supplies are basically hand-to-
mouth, but will soon exceed immediate demand and previous delayed
shipments will be back on schedule.

0930c steve Schneeberger  (608)250-3204

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STAT News Service