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USDA: Dairy market conditions Australia and New Zealand

Mar 13: Australia and New Zealand: The international market for dairy products is fairly quiet with most buyers delaying activity because of concerns over the conflict in the Middle East. In general, few new spot significant sales will originate from the region due to weather reduced production this season and limited inventory for winter shipments. The stronger Australian and New Zealand dollars compared to the US dollar are another contributing factor in reported price ranges. The milk production season is trending toward the traditional seasonal end in May in New Zealand with the current product mix targeted toward products in the tightest supply/demand situation. Most producers have reduced milking schedules from twice to once per day and there are even some forecasts that many herds may dry up earlier than normal.

Current supplies of exportable dairy products are limited. Spot sale activity is limited to regular accounts due to concern about having enough products in inventory to fill current orders and the usual business expected in the off-season. This contrasts to last year with large stocks available for off-season and early next season deliveries. Generally, dry weather continues in New Zealand though recent light showers have aided conditions.

In Australia, recent rains have greened up pastures and lawns; even caused some localized flooding where the lack of cover and localized heavy rain combined. However, Australia remains in a sizeable moisture deficit position. Manufacturers remain concerned about being able to meet current commitments and to have adequate inventory entering the off-season. Concerns remain over the affect the drought will have on next season's production due to the extra culling, breeding, and the higher cost of feed.

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