News Oceania n°4/2015

Period: February 9 – 20, 2015

AUSTRALIA

• Milk production: near the seasonal low point. Current milk production volumes estimated just above year ago levels.
• Weather situation: cooler weather conditions across Southern Australia has extended pasture utilization and delayed forage purchases for some producers.
• Milk producers: the hay market saw light trading and steady prices. A few cooperatives shifted their farmgate milk prices marginally lower.

NEW ZEALAND

• Milk production: continues to decline.
• Weather situation: the New Zealand government has officially declared the South Island as being in a state of drought. Conditions on the North Island are not as dry, but milk production continues to decline.
• Milk producers: the official declaration of state of drought opens the way for governmental assistance to those producers in the affected areas.

MILK PRODUCTION

• New Zealand *: +4.12% (Jun-Dec 14 vs. Jun-Dec 13)
• Australia *: +2.62% (Jul-Dec 14 vs. Jul-Dec 13)

BUTTER (82%): prices moved substantially higher over market concerns regarding the possibility of reduced supplies; available export supplies are primarily out of New Zealand, while Australian supplies are tight; some increased demand for butteroil is being noted as butter prices have climbed to a level where buyers from some countries find it more economical to purchase butteroil.

CHEDDAR CHEESE: prices held steady; Cheddar has seen some production increases in recent weeks, due to favorable returns; supplies are available in New Zealand; fairly tight supplies in Australia are limiting volumes available for export with domestic prices above export levels.

SMP: prices moved higher; U.S. West Coast port disruptions have added to demand interest with some buyers looking for spot sales to cover delivery delays; supplies in Oceania are more than adequate to cover current commitments.

WMP: prices moved significantly higher, as most buyers perceive supplies tightening in New Zealand; China’s demand continues; WMP supplies are more readily available from New Zealand rather than Australia.

The drought in New Zealand is leading to a decline in milk production, and a consequent reduction in the availability of dairy commodity is espected: this forecast is the predominant force supporting higher prices. Demand for butter, SMP and WMP has increased as buyers are anxious to purchase ahead of possible future price increases.

A small but increasing number of Australian dairy companies are seizing the opportunity to export fresh pasteurized milk to China.

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

More informations about milk production in New Zealand and Australia are available on CLAL.it

CLAL.it – SMP prices in Germany, US and Oceania

CLAL.it – WMP prices in Germany, US and Oceania