News Oceania n°1/2015

Period: December 22, 2014 – January 9, 2015

AUSTRALIA

• Milk production: is on its typical seasonal downward trend. Current outlooks estimate this season’s production to be about equal to last year.
• Weather situation: dry conditions have accelerated milk production declines in some areas.
• Milk producers: hay demand declined over the holiday period and resulted in a leveling off of hay prices, but supplies of high quality hay are in short supply.

NEW ZEALAND

• Milk production: the combination of low payout prices and hot, dry weather, which is limiting pasture growth, are bringing about accelerated declines in milk production.
• Weather situation: dry conditions cover all of New Zealand, but are more severe on the South Island.

MILK PRODUCTION

• New Zealand *: +4,91% (Jun-Oct 14 vs. Jun-Oct 13)
• Australia *: +3,55% (Jul-Nov 14 vs. Jul-Nov 13)

BUTTER (82%): prices moved higher; prices are higher in Australia, supported by good domestic demand and reduced supplies for export, while New Zealand has readily available supplies and prices on the lower end of the range: as a result, the bulk of butter exports coming out of Oceania are from New Zealand; production in typical seasonal decline.

CHEDDAR CHEESE: prices unchanged; steady production; there is increased competition coming from Europe and the U.S.; demand for cheddar in Asia is active.

SMP: prices unchanged; production remains active as butter and SMP production is more financially viable than WMP production, and cream cheese production is strong; there is increased competition in the global market as prices have converged worldwide and supplies from other global sources are readily available.

WMP: prices unchanged; limited interest from China, but some major distributors in China are showing increased interest; demand from the Middle East, Africa and Southeast Asia remains active; recent increases in the Oceania butter market may be foretelling of possible price increases in the weeks ahead.

Oceania dairy product trading has been very light over the yearend holiday period, accompanied by uncertainty about market prospects for the new year.

Note: · Assessments about market trend are expressed in US$; · * Dairy season: July, 1st – June, 30th (Australia), June, 1st – May, 31st (New Zealand).

Source: USDA summarized by the CLAL Team

CLAL.it – Butter prices in Germany, United States and Oceania