Period: February 5 – 16, 2018
Milk production in Australia in the first half (July-December 2017) of the dairy season was +2.96% from the same period last year. There were increases in Victoria (+ 3.6%), Tasmania (+ 6.6%) and South Australia (+ 7.5%), partly offset by decreases in New South Wales (-1.2%), Queensland (-4.5%) and Western Australia ( -0.8%).
New Zealand milk production in the period June-December 2017 grew below expectations, due to drought: +0.93% from the same period last year. Some areas have had rain and some pastures are improving. Any recovery at this point in the waning part of the season will likely be limited in a season context. Some dairy producers have already chosen to dry their cows earlier than usual when it was extremely dry.
Dairy prices in Oceania firmed
SMP buying interest is significant in the near term. Strong buying interest comes from regular customers who typically insist in sourcing in Oceania.
Oceania WMP, the dairy product mainstay of the region, had firming prices and this is viewed as very important in helping to support milk pay prices for the season.
Many Cheddar Buyers want to lock in stocks. Most market participants believe prices could creep higher but certainly no trend lower is expected in the near term. This leaves many buyers comfortable with closing their sales transactions.