Tuesday, 13 December 2016 09:50

Export index hits 30 month high

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THE Australian dairy export index rose to its highest point since 14 April 2014 this week, reflecting stronger commodity prices and a weaker Australian dollar.

In spot quotes from Australasian exporters, all products gained following a positive GDT event last week. WMP gained US$100/t to average US$3,600/t, only slightly below the weighted-average price achieved for GDT contract period one – January delivery. Despite improving production conditions, NZ’s milk supply was lower in YOY terms through to the end of November.

This, paired with increased interest from Chinese buyers for imports as local milk falters has boosted WMP spot prices to their highest point since 21 July 2014. SMP were also higher, up US$50/t to US$2,650/t as global markets await the outcome of the European Commission’s first “test tender” for intervention stocks. Cheddar prices rose US$100/t to US$3,800/t while butter prices gained US$100/t to US$4,300/t.

The Australian dollar ended the week lower at US$0.745, as the greenback gained against other major currencies with speculators increasing their long positions. Moreover, the US Federal Reserve is widely expected to raise interest rates at this week’s meeting in light of strong economic data,.

These factors combined to add 5.4 points to the index, which now stands at 208.

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.

This index was set at 100 on 1 January 2000.

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