Oceania Dairy Market Overview

MADISON - Mar 1/12 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:

Milk production in both New Zealand and Australia continues to
outpace year ago levels and processing plants are working well
to handle the volumes.  New Zealand milk production trends
continue to remain at high levels seasonally; yet at volumes
below recent peak output.  The milk volumes have been handled
well along expected product plans and schedules.  Weather
conditions have been and remain favorable for milk growth.
Temperatures have been mild for the summer season and rains have
kept pastures in good shape.  Current weather conditions remain
good for milk output in Australia.  Despite some spikes in
temperatures and rains, the recent trends of milk being higher
than year ago levels and the total year milk projection ranging
from 2-4% higher for the season continue to take shape.
Australian milk production numbers for January 2012 showed a
5.6% increase over a year earlier, with year-to-date seasonal
production through January running at +3.8%.  January regional
output percentage changes were highest compared to a year ago in
the Tasmanian and Queensland regions.  Dairy product prices in
the region are trending lower.  Butter markets are under
pressure from lower fat price offerings in other regions of the
world.  Lower anhydrous milkfat pricing in a weak market is
providing opportunities for buyers.  Skim milk powder pricing is
lower, reflecting lower auction pricing and competitive levels
with other suppliers.  Demand is fair to good and suppliers are
well contracted and have holdings in good balance.  Whole milk
powder prices were mixed this reporting period.  Output levels
are trending lower, but producers are favoring WMP production
for reasons of best returns and needs.  Cheddar cheese prices
are lower in a slightly weaker market.  Supplies are moderate
for current and contracted needs.



0930c Butch.Speth@ams.usda.gov  (608)278-4152

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STAT News Service