Global outlook

Posted on: 28/05/21

Rabobank’s global outlook for Dairy Prices is positive with once again the main driver being Chinese demand for Dairy Products.

Chinese Demand from China is extremely strong and is heading North of taking more than 40% of New Zealand’s exports in Dairy in 2021.

Rabobank’s projections indicate dairy commodity prices will remain strong well into 2022 despite the fact recent global milk output is expected to increase by 6% in 2021.

In terms of US$ prices WMP prices are 30% up in the first four months of 2021 compared to their 2020 average.

SMP prices have not been seen as high as they are now since 2014 and Butter prices are up 35% in the year. Currency movement plays a big part in particular the weaker US$.

Its starting to look encouraging but given the burden of additional cost of production domestically those lagging behind the improved prices paid by Muller, Arla, First Milk and a heap of Cheese Processors are leaving their farmers on the bread line if not on their knees.