Oceania: lower milk production doesn’t stop decline in commodity prices [News Oceania n°6/2016]

Period: March 7 – 18, 2016

AUSTRALIA

• Milk production: it is considered too late to recover the lower milk production during this season, even if weather improves.
• Weather situation: most of January continued the weather of December, with hot and dry conditions, but late month rains helped change the situation.
• Milk Producers: with the Australian dollar weakening, grain exports are increasing as pricing is more competitive globally. However, this has increased pressure over domestic price, and hence on producers margins.

NEW ZEALAND

• Weather situation: no informations for this time period.

MILK PRODUCTION

• Australia *: -0.66% (Jul 15 – Jan 16 vs. Jul 14 – Jan 15)
• New Zealand *: -2.67% (Jun 15 – Jan 16 vs. Jun 14 – Jan 15)

BUTTER (82%): prices weakened, moving closer to pricing levels in the EU. Butter in the region is in heavy supply, with manufacturers preferring to limit production to filling orders.

CHEDDAR CHEESE: prices decreased. The increasing volumes of cheese awaiting sale are hanging over markets. Cheese stocks in the region are considered heavy.

SMP: prices declined slightly. The SMP markets continue to struggle with heavy volumes of product seeking buyers. EU intervention continues to tether prices toward intervention levels.

WMP: prices increased slightly, moving closer to prices in Western Europe. The upper end price strength also reflects the ability of some manufacturers to meet quality parameters important to certain buyers. Current production is steady.

The lower milk production in Oceania didn’t stop the decline in Butter, Cheddar Cheese and SMP prices.

CLAL.it – WMP prices in Oceania and Germany

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