China contributes to improvement in global dairy sales

Dairy prices on international markets have continued to improve amid increased economic growth in developing countries and China has been a key player in the recovery of dairy prices.

Reports by the US Dairy Export Council (USDEC) showed that China has been the main driver behind growth in the world dairy market for the first quarter of this year, according to Peter Duggan of Bord Bia, the Irish food board.

USDEC suggest that China will continue to be actively buying whole milk powder, cheese and other dairy products to service its booming foodservice sector.

"Growth in dairy demand should spread to southeast Asia, as major new infant formula and beverage manufacturing capacity came on stream late last year. Elsewhere, demand is expected to rise in the Middle East," Duggan said.

Falling milk production has helped support dairy price recovery. Rabobank figures show that EU production for February was 1.3% back on 2009 levels. Production in Argentina was back 11% for March, while Australia was back 3.9% for February.

New Zealand's output for 2009-10 is unlikely to match the previous season's output, despite an increase in national cow numbers. Output in the US was back 0.6% for March but is showing signs of edging up.