The Austral news concentrates the latest information on the dairy market in Oceania and South America.
Oceania: New Zealand export expands in the North Asia
In Australia, recent rainfall could lead to an improvement in pasture growth, supporting milk production and reducing the need to supplement feed.
Milk production in New Zealand in January increased by +0.8% compared to January 2020. Overall, the increase in the period June 2020 – January 2021 was +0.8% compared to the same period of the previous year.
Australian export of packaged milk in the year 2020 increased by +6.1%, this increase is confirmed in January 2021, with a variation of +36.3%. The main destinations are China, Singapore and Malaysia.
CLAL.it – Australia Dairy Export
In Oceania there is a lower availability of milk for processing companies, due to seasonality. Furthermore, in the first weeks of March, New Zealand exports to North Asia were particularly active.
Consequently, the prices of the dairy products recorded significant increases, especially for Butter (+8.9%) and WMP (+11.9%), and are higher than European prices.
CLAL.it – WMP prices in Oceania and in Germany
This trend was anticipated by the Global Dairy Trade event on March 2, which recorded an average price increase of +15.0%. Subsequently, the latest GDT event on March 16 has recorded an average price change of -3.8% compared to the previous event. The variations were negative for WMP (-6.2%) and Butter (-2.8%), while SMP and Cheddar were substantially stable. However, average prices remain above the February levels.
Strong Chinese demand therefore contributes to strengthening prices. However, it is not known what the level of Chinese stocks is, nor if China intends to slow down purchases.
South America: SMP and WMP import from Brazil jumps
CLAL.it – Brazil Precipitation, February 28 – March 6
In South America, the beginning of March was characterized by rain showers which contributed to a better pasture growth. Some dairy operators have reported slight increases in milk production in some areas of Southern Brazil, Argentina and Uruguay.
Market participants argue that higher feed prices are increasing milk production costs.
Stocks of drinking milk are decreasing due to strong retail demand. Butterfat demands are healthy in the cream-based dairy markets, especially from ice cream/frozen dessert manufacturers.
Brazil’s import of milk powders continues to increase at a rapid pace. In the period January – February it recorded variations of +94.7% for the WMP and +101.6% for the SMP, compared to the same period of the previous year.
The reduced availability of milk has favoured an increase in the prices of milk powders, especially for the WMP.
CLAL.it – Brazil Import of WMP
Source: CLAL processing on USDA, IHS and local sources.
Note: assessments about market trend are expressed inUS$
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