Stronger Global Milk Supplies Anticipated

GENERAL - Stronger milk supplies amongst the key exporting regions are expected over the coming months according to Rabobank. Brazil and Argentina recorded the strongest growth over the latest quarter, ending July. This reflected a favourable return on the milk/feed ratio combined with good winter pasture conditions, says Peter Duggan, Bord Bia.
calendar icon 21 September 2010
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Recent herd culling has resulted in improved yields in the US, which combined with increased replacements being introduced to the herd ,helped supplies grow by two per cent. Both Australia and New Zealand have started the 2010/11 season impressively. NZ output in latest three month period, ending August rose five per cent, while Australian output rose by four per cent in the quarter ending in July.

Looking ahead to the remainder of 2010, Rabobank believe that supplies among the key global exporters will increase. Solid dairy margins are expected to underpin growth in the EU, Brazil, US and Argentina. The seasonal New Zealand peak is approaching, with growth in the region of five to eight per cent anticipated for the 2010/11 season if climate conditions remain favourable. In Australia, better rainfall has helped pastures greatly with growth in supplies over the next quarter forecast at three per cent.

Rabobank expect some easing in global dairy consumption in response to weak economic growth in developed economies and some price pressure in developing economies, as retail dairy prices increase. Despite this trend, any slowdown in consumption is expected to be counteracted somewhat by increased import demand from milk deficit regions like Russia and Pakistan, where supplies have been interrupted. In addition, output in grain fed regions could ease over the coming months in response to higher feed prices.

TheCattleSite News Desk

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