China Sparks Surprise Dairy Revival

CHINA - The world dairy market has shown a greater than expected improvement, which is expected to continue.
calendar icon 21 September 2009
clock icon 1 minute read

A Rabobank dairy report says most dairy commodities have risen between 25 and 35 per cent in the last three months reports ABC Rural.

The bank's dairy analyst Tim Hunt says the increases are a surprise.

"It's fair to say the market's recovered quicker, and to a higher point, than we thought it would," he says.

"The main factor behind that, we believe, is that Chinese buyers have come into the market for a lot of product in recent months."

A health scare last year that saw melamine discovered in infant formula is thought to have triggered the increase in China's buying of foreign dairy products.

"Since the melamine crises we've seen a distinct switch in the preference by Chinese consumers for imported product, which they perceive to be safer," Mr Hunt told ABC Rural.

"We've also had relatively cheap prices for whole milk powder in world markets relative to the cost of sourcing that locally in China."

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