Tuesday, December 18, 2018
 China Imports Less Milk Powder in August  

During the month of August China imported only half of the amount of whole milk powder that it did during August of 2012. But does that mean demand from this market has weakened or is it a supply issue? 

New Zealand is the source for virtually all of China's WMP imports. WMP supplies out of NZ were curbed substantially in the latter half of the 2012/13 season due to the severe drought that occurred through most of NZ's dairying regions at that time. 

The lack of available supply from NZ in recent months has meant China has had to search for alternative suppliers for this product. In August China imported 1,857 tons of WMP from European suppliers, 900 tons of WMP from Uruguay, 275 tons from Argentina, and 388 tons of product from Australia. NZ still provided the majority of share, supplying over 18,000 tons in August.  The volumes look small however when you compare them with August 2012 when China imported nearly 43,000 tons of WMP from NZ. 

On a year to date basis China imported 27.5% more WMP than during the first eight months of 2012, with 95% of this product supplied by NZ. China's strong demand for WMP is underpinning global market prices for this commodity. The Agrifax price series for WMP has averaged above US$5,000/ton for the past 6 months. Never before has WMP price remained at elevated levels for such a long period of time. The NZX Dairy Futures market is showing a downward sloping forward price curve indicating that prices for physical product should also begin to ease back. 

Source: Dairy Trader


Posted on Thursday, September 26, 2013 (Archive on Thursday, October 03, 2013)
Posted by bholcomb@adpi.org  Contributed by bholcomb@adpi.org