Report 35 – Released on August 27, 2020

AUSTRALIA:

Australia has benefitted from recent rain over a wide swath of dairy regions. This builds on a mild winter. The result is decent stocks of feed and good growth of new season feed and hay. Dairy producers have benefitted by lower need to move feed some distance to remain stocked. Hay prices have gone down, which will also contribute to profitability for dairy producers.

Tensions between Australia and China which developed after the spread of COVID-19, are said to have resulted in ending a pending deal for Chinese interests to acquire an Australian dairy processor. Necessary express approval of the sale by the Australian government was never given. The long pending approval process resulted in the parties agreeing to step away from a sale.

NEW ZEALAND:

July 2020 New Zealand milk solids reported by DCANZ, 24.8 million kg, are up 5.3 percent from July 2019 milk solids, 23.5 million kg. July 2020 milk production, 286 million MT, is up 4.4 percent from July 2019, 274 million MT.

A number of New Zealand dairy traders and analysts are less wowed by the percentage increases then some other observers. The New Zealanders note that last year was, in their opinion, unusually low production. That they say, results in illusionary percentage increases in a historical context.