USDA: Oceania Dairy Market Overview Mid October 2021

Report 41 – Released on October 14, 2021

AUSTRALIA:

Industry sources expect Australian farm milk production to grow slightly this productionseason. Favorable milk prices and lower input costs could help farmers maintainprofitability. However, a cool, wet spring has been both supportive and a hindrance togrowing milk output. While slowing farm milk output the first few months of the new season,farmers think the added moisture will aid in forage production later. Stretches of drierweather have since helped improve milk output volumes.

AUSTRALIA SECONDARY DATA:

According to Dairy Australia. August 2021 milk production, 690.6 million liters, was down3.6 percent from August 2020. Seasonal YTD milk production through August 2021, 1,297.5million liters, decreased 3.6 percent from July – August 2020. More detailed production dataare in the table which follows.

AUSTRALIA MILK PRODUCTION, MILKFAT and PROTEIN

                            July 2021 – August 2021

                            Million Percent Change   Percentage
     State                  Liters  From 1 Year Ago  Milkfat Protein

     New South Wales          190.8   +2.8            4.04    3.40
     Victoria                 865.9   -4.4            4.07    3.44
     Queensland                53.7   -1.6            4.05    3.37
     South Australia           70.3   -4.1            3.87    3.41
     Western Australia         58.1   -4.8            3.85    3.34
     Tasmania                  58.7  -10.3            4.44    3.54
     Australia (Total)      1,297.5   -3.6            4.06*   3.43**

     *  +0.2 percent from prior year period
     ** -0.8 percent from prior year period

July- August 2021 milk exports from Australia, 73,977 MT, increased 51.4 percent from July-August 2020, according to Dairy Australia.January – August 2021 bulk and packaged milk exports from Australia, 194,000 MT, increased21.1 percent from January – August 2020, according to CLAL data made available to USDA. Themain export destinations January – August 2021, quantities, and percent change from January– August 2020, were China, 100,512 MT, +63.97 percent; Singapore,38,948 MT, +4.76 percent;and Malaysia, 13,608 MT, -12.91 percent.

NEW ZEALAND:

Spring milk output for the new milk production season is below expectations in New Zealand. Wet conditions are still suppressing early season pasture growth and milk production.Industry contacts say cold, rainy weather has reduced the quantity and quality of earlyseason pastures. The rain has also delayed crop planting in some parts of the country. Whilecurrently a hindrance, farmers feel the added soil moisture could extend pasture growth andcrop growth through late spring and early summer. As temperatures warm and paddocks dry out,milk output volumes should grow, and pasture conditions should improve.With a slow start to the milk production season, New Zealand milk supplies may be tighterthan expected. Industry analysts suggest that with the first three or four months of themilk season behind last year, it may be difficult to make up ground later in the season.

With tight milk supplies and strong dairy commodity prices for this time of year, severaldairy industry organizations within New Zealand have lifted their milk price forecasts forthe season by 25 to 75 cents. Currently, the milk price forecast is between NZ $8.15 to$8.62 per kg milk solids. While favorable milk price forecasts look promising, industryanalysts also urge caution. There are still a lot of market uncertainties to work throughbefore the end of the season.

New Zealand farmers continue to face a myriad of challenges. Besides weather and priceuncertainties, regulatory conditions and farm labor shortages add to the stress farmersface. Due to COVID restrictions, many farms have not been able to get the international farmworkers needed for calving, milking and other essential farm work. Dairy industry leadersare hopeful that recent actions by the New Zealand government may provide a pathway toresidency for international farm workers and encourage workers to come to New Zealand.

     Information for the period October 4 - 15, 2021, issued biweekly

     Published by:
     Dairy Market News - Madison, WI
     MIKE BANDLI, (608)422-8592
     Email: mike.bandli@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

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