Report 15 – Released on April 9, 2020

AUSTRALIA

The Australian dairy industry is quite focused on sales within Australia to feed the population there. Exports are important too, but a priority is the substantial domestic consumer base.

The ongoing stay at home conditions have scrambled some of the typical production channels and demand. As with elsewhere, there was a recent strengthening of retail sales to consumers stocking up. Sales for food service declined. That led to sales boosts for some dairy manufacturing, but less demand for other manufacturing.

A result is more challenges for multi plant processors to manage milk across a number of plants, also dealing with supply routes to plants from dairy producers. While most balancing plants strive to take all the milk available from contracted producers, some plants have stopped taking milk from other sources. A primary challenge has been increased production of retail dairy goods. Some other plants previously focused on food service demand, are trying to adapt. There are some concerns with dairy products which had been made for food service which remain unsold. The concern is with items getting closer to the expiration date.

NEW ZEALAND

February 2020 New Zealand milk production reported by DCANZ was 1,875 million MT. February 2020 milk solids, 167,874 million kg, are up 1.7 percent from February 2019, 165,025 million kg.Late season buying interest in the main dairy commodities in New Zealand has been better than had been expected several weeks ago after impacts of COVID-19 began to ripple through markets. Recently lower dairy derivatives markets were upended by recent demand strength,especially in whole milk powder. China is typically a major customer for some New Zealand dairy products. Chins moving back toward more normal dairy import patterns is a welcome aspect to the current dairy situation in New Zealand. Limited late season product availability, facing resurgent demand, has given some welcome price strength. Producers are hoping this will give a tailwind to the season’s final milk price.

     Information for the period March 30 -  April 10, 2020, issued biweekly

     Published by:
     Dairy Market News - Madison, WI
     Eric Graf, 608.422.8590
     Email: Eric.Graf@usda.gov

     Additional Dairy Market News Information:
     Dairy Market News (DMN) by Phone: (608)422-8602
     DMN Website: https://www.ams.usda.gov/market-news/dairy
     DMN MARS (My Market News): https://mymarketnews.ams.usda.gov