Oceania Dairy Market Overview

MADISON - Jul 17/08 - 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 is at
seasonal low levels and producers and handlers in both Australia and
New Zealand are optimistic about the upcoming season.  The 2008 - 2009
season will resume in New Zealand in August with Australia a few weeks
later.  Winter weather conditions continue to concern producers and
handlers.  In New Zealand, colder than usual conditions have prevailed
for much of the winter season with moisture occurring, but often
lighter than desired.  In Australia, lack of measurable winter
moisture is a major concern for most milk producers.  Moisture has
fallen in most of the dairy regions, but not sufficient enough to
replenish greatly depleted moisture reserves.  Lack of moisture for
catchment basins will only further limit water allocations, especially
if the spring begins with water levels below previous year levels.
The 2007 - 2008 milk production figures for New Zealand have been
estimated to trail last season by 4.3%.  This is a little stronger
decline than many had anticipated.  In Australia, with June data left
to collect, 11 months of milk output have milk volumes trailing last
season by 4.6%.  Producers and handlers are pleased at the stronger
than anticipated finish to the season.  In fact, May output increased
5.2% over May of last year.  This is the first month all year that
current month output has surpassed previous year comparables adjusted
on a day for day basis.  Traders and handlers report that buyer
interest is quiet.  Sales negotiations are occurring for upcoming
needs, although buyers and suppliers are proceeding more cautiously
than in years past.  The uncertainty of the future is causing buyers
especially to proceed cautiously and, in instances, going short on
purchases until further developments occur.  With production
seasonally low in Oceania, product availability is limited and prices
are generally holding steady with slight fluctuations being reported.

0930c steve Schneeberger  (608)250-3204

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STAT News Service