STAT Communications Ag Market News

Oceania Dairy Market Overview

MADISON - Jul 17/14 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:
Australian milk production was flat over the last fortnight with levels at or
near the seasonal low point.  The mild weather has given way to more normal
winter conditions with cold and rains covering much of the dairy producing
areas.  Most dairy farmers have signed on for the new season with their milk
processor of choice.  Beginning season milk prices are above levels of years
past and producers are readying for a good start to the new season.  Cows
will begin calving over the next 4 weeks.  Export spot sales activity has
been fairly light for most dairy commodities.  Manufacturing plants continue
to cycle through their typical shut downs for planned maintenance projects.
Stocks are being worked lower with supplies moving through contracts.
Trading is light with reports that China has mostly adequate supplies for the
near term and Ramadan has lowered export interest from the Middle East.
According to Dairy Australia, Australian production of various dairy
commodities for May 2014 showed the following percentage changes compared to
2013: butter, +13.7%; butteroil, -13.2%; skim milk powder, +8.1%; whole milk
powder, -11.9%; buttermilk powder, +15.7%; cheese, +1.9%; and whey powder, -
7.4%.  Dairy Australia also reports dairy product exports for the July-May
period totaling 667.4 thousand tons, down 8.1% from the year ago period. The
largest export category is skim milk powders (SMP). The total value of
exports is 18.1% higher over the prior year period. The highest value items
are SMP and WMP.
New Zealand's milk producers are waiting for the start of the new season.
Current milk production is limited, as a majority of cows are dried off and
on winter pastures.  Weather remains mild on the South Island, but the North
Island has seen heavy rains and colder temperatures.  Some flooding did occur
in areas north of Auckland, but the impact to dairy operations is said to be
minimal.  Calving has started in some areas on the North Island.  Stocks of
dairy commodities are being worked lower, with uncommitted supplies of whole
milk powder readily available for the spot market.  Going into the new
season, some manufacturers are adjusting their production schedules away from
whole milk powder to butter and skim milk powder production.  New Zealand's
2013-14 export revenue increased by 30% according to a report released by the
Ministry of Primary Industries.  At the July 15 GDT event #120, average
prices ranged from 10.9% lower to 1.1% lower from the prior event across
categories. The all contracts price averages (US$ per MT) and percent changes
from the previous average are:  anhydrous milk fat, $3,250 -10.0%; butter,
$3,144 -1.1%; buttermilk powder, $4,426 -4.6%; cheddar cheese, $4,164 -1.6%;
lactose, n.a.; milk protein concentrate, n.a.; rennet casein, $9,761 -8.9%;
skim milk powder, $3,516 -7.1%; and whole milk powder, $3,088 -10.9%.
0930C rick.whipp@ams.usda.gov 608.278.4151
USDA/AMS/Dairy Market News, Madison, Wisconsin
Dairy Market News website: www.ams.usda.gov/dairymarketnews
Dairy Market News database portal: www.marketnews.usda.gov/portal/da

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