Oceania Dairy Market Overview

MADISON - Jun 6/13 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  The NEW ZEALAND milk output is slowing at
levels along seasonal trends as the calendar enters the winter
season.  Overall, milk remains at levels below a year ago.  The
effects of the March drought remain a strong influence on the
current production cycle.  Despite recent wet conditions, there
has been limited response to milk production.  Pasture
conditions are expected to improve with reseeding growth
developing.  Farmers are seeing more optimistic news about the
next season.  Higher payments for next season's milk are being
set by milk buyers/processors.  The payments are a result of the
higher market prices for finished dairy products and the
shifting supply and demand balance in international markets.
AUSTRALIAN milk production trends remain below a year ago levels
in most milk producing regions.  Milk price step ups are
reported for this production season in Australia.  Additionally,
opening milk prices for next season are being calculated and
projected to move higher.  Recent currency devaluations would
factor into allowing for increased milk pricing.  Farm economics
and the effects of weather conditions continue to put a damper
on current milk production.  Rainfall is helping to rebuild soil
moisture and water reservoirs that will benefit next season's
pastures and crops.  Domestic dairy product production and
demand are stable.
      Dairy product prices have retreated from recent high
levels.  Other supplying countries are filling in voids for
commodity products.  Dairy product prices at current levels and
offerings are creating a sense that markets could gain support.
Current offering volumes are light from Oceania sources.  Short-
term offerings have slowed as products are moving to fill
contracted volumes and to products of greatest needs.  Commodity
product business is slowing seasonally.
      gDT:  Results are noted for the June 4th gDT session #93.
The all contracts price averages (US$ per MT) and percent
changes from the previous average are:  anhydrous milk fat,
$4,478 -4.3%; butter, $3,743 -2.6%; buttermilk powder, $4,410
+3.3%; cheddar cheese, $4.877 n.a.; lactose, not traded; milk
protein concentrate, not traded; rennet casein, not traded; skim
milk powder, $4,164 -3.2%; and whole milk powder, $4,643 -7.1%.
0930c Butch Speth Butch.Speth@ams.usda.gov 608.278.4152

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STAT News Service