THE Australian dairy export index retreated by 2.4% this week, on the back of weaker milk powder prices and a slightly stronger currency.
In spot quotes from Australasian exporters, SMP shed US$200 to US$2,200/t, while WMP fell US$50/t to $US2,650/t. Butter price steadied at US$3,950/t. The cheddar price remained stuck at US$3,500/t for the fourth consecutive week.
The Australian dollar has edged higher, ending the week at US$0.761 as remarks from US Fed chair Janet Yellen that the economy running hot temporarily could reverse the damage of the 2008/09 recession. This combined with disappointing retail sales data has reinforced speculation that increases in US interest rates will be gradual.
These factors combined to lower the index by 4.4 points, to 178.5.
Note: - The index is an indicator of spot trends in gross export returns to the Australian dairy industry based on quoted Australasian dairy commodity export spot prices, movements in currency and the mix of total milk usage in product exports by the Australian industry.