Oceania: Butter prices on the low end of the global market [News Oceania n°11/2015]

Period: May 18 – 29, 2015

AUSTRALIA

• Milk production: has marginally declined, also because weather conditions have been detrimental to cow comfort levels.
• Weather situation: rain and cold weather over most of the major dairy producing areas.
• Milk producers: weather has contributed to an increase in hay prices.

NEW ZEALAND

• Milk production: is coming to a rapid close.
• Milk producers: a vast majority of the dairy herd should be on winter pastures by the end of May.

MILK PRODUCTION

• New Zealand *: +2.18% (Jun 14-Mar 15 vs. Jun 13-Mar 14)
• Australia *: +2,93% (Jul 14-Apr 15 vs. Jul 13-Apr 14)

BUTTER (82%): prices declined; supplies are fairly tight, but some discounts can be found from those manufacturers seeking to adjust their inventories; Oceania prices are on the low end of the global market; demand has been fairly good with good interest coming from the US in recent weeks.

CHEDDAR CHEESE: prices moved marginally lower on the upper end of the range; there is plenty of competition coming from the EU on the japanese market; market analysts are anticipating further marginal price declines will result from the current negotiations; domestic prices in Australia are declining as cheaper imports are coming into the country primarily via New Zealand.

SMP: prices are down; demand is weak; most buyers in Southeast Asia have their near term needs covered; some manufacturers have marginally increased prices for Q3 and Q4 offerings; global supplies are readily available with increased production in the northern hemisphere; discounts can be negotiated on spot sales from those manufacturers seeking to adjust their stock levels prior to the close of the financial year (June 30 for Australia and July 31 for New Zealand).

WMP: prices moved slightly lower; demand is steady at best with movement into Southeast Asia and Japan, while interest from China remains sluggish; demand from Africa is focused on available supplies in Europe, primarily due to the favorable transportation cost differential.

Most commodity prices in New Zealand continue to move lower, but the rate of decline has lessened and may indicate that prices are near their low point.

Oceania Butter prices are on the low end of the global market.

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