Oceania Dairy Market Overview

MADISON - Jan 22/04 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:  Milk production in Oceania continues to edge lower in both 
Australia and New Zealand.  In New Zealand, milk output continues to run about 
3% ahead of last year at this time.  Production is trending gradually lower on 
both islands.  On the North Island, rainfall has been reported in recent days 
and is contributing to favorable pasture growth as the season winds down.  On 
the South Island, moisture is not as plentiful and conditions are often dryer 
than many producers desire at this time of the season.  In Australia, 
temperatures moderated from the high levels of a few weeks ago, but now are 
heating back up.  Some milk handlers indicate that they do not have a good 
feel as to the impact these hot temperatures might have had on production, but 
do indicate that total receipts continue to lag last season by 6 - 7%.  Stocks 
of manufactured dairy products in Oceania remain in close balance and are 
often reported as tight.  Handlers do indicate that they are meeting most 
contractual commitments, but have very little, if any at all, inventory 
available for spot or new buyer interest.  In many instances production 
schedules are keeping pace with delivery schedules, thus most products are 
experiencing little warehouse time.  At this point in the milk production 
season, the product mix in Oceania is often centering around milk powder and 
cheese.  Oceania traders and handlers are curious as to the impact the recent 
export subsidy increase in Europe will have on overall market conditions and 
prices.  In recent weeks, Oceania prices have firmed slightly.

0930c steve schneeberger  (608)224-5084 

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STAT News Service

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