MD_DA124 DA MD DA124 Butter - Oceania MADISON, WI. March 30, 2017 (REPORT 13) OCEANIA INFORMATION GATHERED 03/20/2017 - 03/31/2017 U.S. DOLLARS PER METRIC TON, FOB PORT BUTTER: Butter prices moved higher in Oceania, following the trend in many areas of dairy fats showing price strength. New Zealand is regarded as the dominant exporter of butter globally. Some concerns are voiced as to the ability of New Zealand butter manufacturers to meet global demand if European butter exports pull back, so as to continue to meet internal European demand. Declining New Zealand butter exports compared with one year ago contribute to this concern. Sellers and buyers in Oceania butter markets are much attuned to the tightness of butter supplies in Europe, substantially diminishing a potential alternative source. Moreover there is still a preference by some New Zealand dairy manufacturers to marginally channel milk to whole milk powder rather than butter. New Zealand exports of butter year to date January-February 2017 declined 18.2% from the same period one year earlier, according to Eucolait. Export volumes and primary destinations are shown in the following table: Main Three Destinations Jan-Feb 2017 Destination Quantity (MT) % of Total China 6,595 13.4% Australia 3,982 8.1% Egypt 3,296 6.7% At GDT Event 184 on March 21, the butter all contracts price increased 4.9% and the April contract price increased 24.0%. 82% BUTTERFAT: 4,950 - 5,475 0930c eric.graf@ams.usda.gov USDA/AMS/Dairy Market News, Madison, Wisconsin Dairy Market News website: http://www.ams.usda.gov/market-news/dairy Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-home