Oceania Dairy Market Overview

MADISON - Sep 11/14 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:
Milk production in Australia is trending higher seasonally and
is reflecting improving weather, feed, and input conditions.
Weather has been favorable for cow comfort, calving, and pasture
growth.  Feed costs have been relatively stable.  Currently,
some areas of Australia are experiencing moisture deficits and
concerns are that the lack of rains could factor into pasture
growth in areas without access to irrigation.  Analysts are
forecasting higher milk output for the milk season that began
July 1.  Initial, official forecasts were for a 2% increase over
the previous season.  According to Dairy Australia, July 2014
exports increased 7.5% in volume and 0.6% in value, compared to
July 2013.  Skim milk powder export volumes were 80.2% higher
than a year earlier.  New Zealand milk production trends
continue to build.  Early indications are nearly 10% higher than
year ago levels for the first two months of the new season.  Wet
weather is common over the North Island and temperatures are
moderate, creating good pasture growth.  More cows are calving,
adding to the milk output.  Weather is favorable on the South
Island.  Calving is just beginning to build and the milk flow is
slowly increasing.  Cash flows are tighter at the start of this
season, reflecting milk pay prices.  Dairy product pricing is
harder to gauge as disruptions are occurring in the marketplace,
generally outside of the region.  Declining prices are noted
across product categories.  Buyers are more cautious in making
purchases of dairy products with the weaker trends enveloping
the local and global dairy markets.  Demand from major buying
countries remains light.  Processing plants are running well as
the milk flow builds.  The strategy is to make the right product
mix to balance buyers' needs and maximize returns.  At the
September 2 GDT event #123, average prices ranged from 14.3%
lower to 4.3% 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, $3,360 -
5.8%; butter, $2,753 -5.6%; buttermilk powder, $3,174 -12.9%;
cheddar cheese, $3,275 -4.9%; lactose, n.a.; rennet casein,
$8,232 -14.3%; skim milk powder, $2,600 -9.5%; and whole milk
powder, $2,673 -4.3%.
0930C butch.speth@ams.usda.gov 608.278.4152
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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STAT News Service