MD_DA120 Oceania Dairy Market Overview Report 39 - Released on September 29, 2022 NEW ZEALAND By New Zealand dairy industry expectations, milk production has underperformed thus far this new season, as volatility in weather conditions caused declines in pastures, along with production challenges that suppressed milk output. Farmers across the regions are reporting the same factors as milk production falls. However, national weather forecasts predict that drier conditions will prevail, following the wettest winter on record, which affected almost every part of the country at some point. Farmers expect that once that happens, pasture growth will likely progress, with ample soil moisture and optimal growing conditions. On another note, a recently released report indicated that total exports were the most ever for the month of August. On a value basis WMP was reported up 102 percent. Meanwhile, New Zealand announced the final farm gate milk price for the 2021-2022 production season. The payout totaled $9.30 on average, with a 20 cents bonus per share, leading to a record $9.50 kgMS. Also reported were higher inventories to end the year, likely the result of heavier yearend milk collections, which became bound by factory limitations and shipping disruptions. AUSTRALIA: In Australia, despite advantageous weather conditions in most regions over the last season, Australia's milk volumes ended the 2021-2022 season down, and the country continues to report milk production declines for the 2022-2023 milk production period. Industry projections point to flat milk collections for the 2022-2023 production season. While this year's farmgate milk price for Australian milk producers peaked to the highest ever, workforce concerns, high input costs, and farm exits challenge farmers' confidence. With the downturns in dairy production, Australia's export market is also being pressured as it echoes dairy commodity production declines. Less milk means less production, and fuels competition amongst the country's milk processors. Hence, the highest pay price ever reported, while milk processors' margins have grown tighter with eroding dairy commodity prices. Fittingly, there have been rumblings of a major dairy co-operative's plans to sale some of its Australian dairy operation, which include dairy commodities such as butter and cheese. However, a recent report announced the co-op's decision to maintain ownership of the business, as the ability to tap into the Australia's consumer market was a key driver in the change of events. Information for the period September 19 - 30, 2022, issued biweekly Secondary Sourced Information: AUSTRALIA EXPORTS July 2022 milk exports from Australia, 34,284 MT, decreased 5.7 percent from July 2021, according to Dairy Australia. Published by: Dairy Market News - Madison, WI DANIEL JOHNSON, 608-422-8605 Email: daniel.johnson4@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