Oceania Dairy Market Overview

MADISON - Mar 4/10 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:

      January 2010 Australian milk output trailed January 2009
by 9.1%; while July-January season to date figures are running
6.6% lower than the prior year period.  Current milk
production is moving higher and indicated to be closing the
production gap when compared to a year ago.  Rainfall of
recent weeks has increased pasture growth and has helped feed
quality and translated into improved milk output.  The growth
in milk per cow is allowing the total milk supply to improve.
The product mix at the processor level has not changed or been
impacted by the milk supplies.  The common expectations are
for seasonal milk production figures to close the milk
production year at around -4%.  Feed prices remain relatively
low and allowing for supplemental feeding.  New Zealand milk
production continues to trend higher and current output is
tracking slightly higher than a year ago with total season
estimates still expected to be above the prior year.  Buying
interest early in the reporting period was slow as buyers
assessed needs and producers watched pricing directions on
international markets.  The results of the March 2
global/Dairy Trading event are being reported.  Skim milk
powder (SMP) traded for the first time at the event and all
period deliveries averaged $2927 per MT.  May deliveries
averaged $2825; June - August deliveries averaged $3143; and
September - November deliveries averaged $2927.  Trades of
whole milk powder (WMP) averaged $3281 per MT (-0.8%).  May
deliveries averaged $3291 (+2.8%); June - August deliveries
averaged $3337 (+0.9%); and September - November deliveries
averaged $3204 (-2.5%).  For anhydrous milkfat, trades
averaged $3959 per MT (-5.4%).  May deliveries averaged $4008
(-3.8%); June - August deliveries averaged $3976 (-5.2%); and
September - November deliveries averaged $3884 (-7.1%).
      Current butter pricing is mostly unchanged with offerings
often trending lower.  Demand is fair and along expected
levels.  Seasonal butter production is along projected levels.
Cream supplies are adequate.   SMP pricing is mostly steady to
higher.  Production levels are seasonal.  Demand is fair to
good for current offerings.  A majority of SMP has been
committed for the season and sellers are working at moving
their remaining powder.  The trade is assessing market
weakness in the U.S. and what impact that could have on the
local market price.  Whole milk powder pricing levels are
steady to higher and are reflecting firmer trading levels at
the recent auction and some related trades.  Supplies are
generally in good balance.  Production trends are steady and
expected to continue on with the seasonal milk supplies.
Oceania cheese prices have trended lower with some pricing
pressures evident in other world markets.  Regional demand
remains mixed with some buyers well covered for the current
season and others filing in some needs.  Production is along
expectations and cheese supplies are available on a limited
basis to fill in needs.


1100c Butch Speth (608)250-3202

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STAT News Service