Oceania Dairy Market Overview

MADISON - Jan 21/10 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:

      Oceania milk production is on the down side of the season
with some area declines quite noticeable.  In New Zealand, an
El Nino weather pattern is impacting areas of Central and
further North on the North Island.  Reports indicate that
output in some of this area is down 15% from projections.
Already in this area, a casein plant has been shuttered, six
weeks earlier than usual.  Elsewhere in New Zealand, milk
output is being impacted by weather patterns, but not to the
extent of Central and Northern areas.  Milk producers and
handlers indicate that rainfall is needed in the very near
future to re-establish pasture growth.  They state that this
rainfall must occur for at least a week to impact depleted
moisture levels.  In Australia,  weather patterns are also
impacting dairy regions, but not to the extent of Northern New
Zealand.  Australian milk production figures for November were
recently released which indicated that milk output for
November was down 6.8% when compared to November 2008.  On a
cumulative year to date basis (July - November), milk output
is trailing last year comparables by 5.4%.  In Victoria, the
major milk production region of Australia, Novembers
production was down 10.0% with the Northern area of Victoria
recording a 17.6% decline.  Overall milk volumes are declining
at a more gradual pace than their New Zealand counterparts.
Manufacturing schedules are declining in both countries with
stocks being generated for known needs.  In most instances,
stocks are adequate for ongoing and regular customers with
basically no stock available for new or spot needs.  Traders
and handlers indicate that buyer interest is present, but no
product is available to fill these inquiries from the Oceania
region.  Following the results of the most recent global/Dairy
Trading event in New Zealand on February 2, many traders and
handlers adjusted their near term prices to be in line with
the auction averages.  Supplies of whole milk powder appear to
be tighter in Australia, as no Australian whole milk powder
was available for the January auction.  Anhydrous milkfat
traded slightly higher in January following a sharp decline in
December.  Also in the past few weeks, it was announced that
skim milk powder will be traded at the March auction for the
first time.


0930c steve Schneeberger  (608)250-3204

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STAT News Service