Oceania Dairy Market Overview

MADISON - Oct 9/14 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.

OCEANIA OVERVIEW:
Australian milk production is building towards the seasonal peak.  The good
early season weather conditions for milk production have given way to dry
conditions in some areas.  Irrigation has started in areas of Victoria, which
is earlier than usual.  Some producers have increased feedings of silage and
grain to increase milk production ahead of the dryer months of December,
January and February.  Production through September has seen increases over
year ago levels, but weather concerns have caused some cooperatives to lower
their milk production estimates for this season.  Manufacturers are focusing
on skim milk powder and butter production and expanding their inventories.
Dairy Australia reports dairy product exports for the July-August period
totaling 101.7 thousand tons, up 5.5% from the year ago period. The largest
export category is skim milk powders (SMP), up 68% for the same period last
year. The total value of exports for the July-August period is down 3.7%
compared to last year.  According to Dairy Australia, August 2014 milk
production in Australia was 1.9% above August 2013. The state changes from a
year earlier are: New South Wales, +4.1%; Victoria, +2.5%; Queensland, -8.4%;
South Australia, -4.6%; Western Australia, +1.3% and Tasmania +8.9%.
New Zealand milk production is robust and expanding towards the seasonal peak
and above year ago levels.  Typical spring weather has been experienced on
both the North and South Islands with plenty of rain.  Some cooperatives have
reduced farmgate prices.  Some producers have responded by taking steps to
increase production, via supplemental feeding, in order to sustain a
comparable cash flow.  Milk manufacturing is very active and supplies are
building, which is typical for this time of year.  July milk production as
reported by DCANZ was 0.20 million tons, up 5% from July 2013 and equal to
the level two years ago.  At the October 1 GDT event #125, average prices
ranged from 11.3% lower to 1.2% 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, $3,117 -5.0%; butter, $2,514 -
6.6%; buttermilk powder, $2,723 -11.3%; cheddar cheese, $3,028 -1.2%;
lactose, n.a.; rennet casein, $8,224 -1.4%; skim milk powder, $2,540 -2.7%;
sweet whey powder, $1,175 -9.3%; and whole milk powder, $2,443 -10.0%.
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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STAT News Service