February 4, 2005

Unfavorable weather conditions affect milk production in New Zealand and Australia

Milk production trends in Oceania continue to decline seasonally.  A recent report indicated that milk volumes were down as much as 5% in New Zealand for the first half of the season.  Cooler temperatures and poor weather conditions are being attributed to the decline in milk production. 

In Australia, milk production for the period July through November was down 1.2% on a cumulative basis.  Some milk handlers and producers were surprised at this fall, with many of them feeling that the decline would not have been this much.  A significant portion of this decline occurred in November when milk volumes were down 3.5% when compared to last November.  Australia is anticipating that December reports will be more positive and cumulative production will be in closer balance with last season. 

As milk production reports indicate lighter volumes, milk handlers continue to report that dairy product production is also down on last season, but traders and handlers are optimistic about fulfilling their commitments.  Stocks of product are in very close balance and often short of full needs.  Handlers and traders state that with their supply/management agreements with other sources throughout the world, they should be able to fully acknowledge their commitments.  Some traders and handlers are already looking to the new production season which will resume in August/September with more optimism. For some, the past few years have not been as positive as they would have desired, although they remain optimistic about the dairy industry in Oceania.