MADISON - Dec 4/14 - SNS -- The USDA published its latest review of dairy market conditions in Australia and New Zealand today.
OCEANIA OVERVIEW: Australian milk production is beginning to trend downward, but remains above year ago levels. Persistent dry conditions in western Victoria and dry weather in Tasmania over the past fortnight may accelerate the downward trend in the coming weeks. The milk production forecast by some cooperatives remains around 2% above last year. Some badly needed rains covered some of the dairy producing areas of Victoria and the southern portions of New South Wales. The rains will help pasture and forage growth, but are hampering the barley harvest. Hay harvest activities are well underway in the dairy producing regions and yield assessments are variable, but generally below average. Demand is strong for 2015 hay supplies with current prices steady to firm. The recently signed Free Trade Agreement with China will benefit infant formula manufacturers with a phase out of the current 15% tariff over the next four years. The GDT auction will begin offering Australian skim milk powder beginning in January 2015 with trading event 132. According to Dairy Australia, October 2014 milk production in Australia was 6.0% above October 2013. The state changes from a year earlier are: New South Wales, +6.5%; Victoria, +5.3%; Queensland, -3.4%; South Australia, +0.5%; Western Australia, +5.8% and Tasmania +17.8%. Australia's milk production season to date (July-October) is +3.8%, compared to last season. Milk production in New Zealand is moving lower with steeper declines noted on the South Island. Milk production is above year ago levels and manufacturers are busy processing current milk volumes. Farmgate prices are lower this season, compared to last with many producers forgoing supplemental feeding. This situation may lead to a shorter season as producers may dry off cows earlier in light of the marginal returns on extended production. Some New Zealand cooperatives have increased their investment in milk powder, infant formula and UHT processing. The additional investments by these cooperatives will help reduce their exposure to the more volatile bulk commodity prices. October milk production as reported by DCANZ was 3.30 million MT, up 4.5% from October 2013 and 10.2% higher than the level two years ago. October milksolids reflected a 5.4% increase compared October 2013. At the December 2 GDT event #129, average prices ranged from 7.1% lower to 9.3% higher 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, $3,817 +9.0%; butter, $2,849 +7.3%; buttermilk powder, $2,560 +8.8%; cheddar cheese, $3,017 +5.2%; lactose, n.a.; rennet casein, $7,255 +9.3%; skim milk powder, $2,423 +5.7%; sweet whey powder, $1,205 n.a.; and whole milk powder, $2,229 -7.1%. 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
---
STAT News Service
Only active subscribers can read all of this article.
If you are a subscriber, please log into the website.
If you are not a subscriber, click here to subscribe to this edition of the STAT website and to learn more about becoming a subscriber.