MD_DA124                                                         
DA                                                               
MD DA124 Butter - Oceania                                        

MADISON, WI.  July 20, 2017 (REPORT 29)                          

OCEANIA                                                          
INFORMATION GATHERED  07/10/2017 - 07/21/2017                    
U.S. DOLLARS PER METRIC TON, FOB PORT                            

BUTTER:  

       Oceania butter prices once again firmed, reaching the highest 
level of 2016 and 2017. Limited supply facing strong demand for dairy 
fats is what keeps moving butter prices higher. While a number of 
butter buyers are uncomfortable with current pricing, sellers are in a 
position to insist. Expectations are that less butter will be offered 
through future GDT events due to demand from alternate sales 
opportunities.                                                                 
This year January-May, Australia butter exports, 4,914 MT, decreased 
41.4 percent from the same period one year earlier, according to 
Eucolait. January-May, the range of percentage changes year to date in 
cumulative export volumes is from -33.7 percent in April, to -43.6 
percent in January.
       Export volumes and primary destinations are shown in the 
following table:

  		 Australia Butter Exports
		 Main Three Destinations 
		 January-May 2017 
 
Destination     Quantity(MT)   Percent of Total  
China           953              20.3 
Singapore       807              17.2 
Malaysia        787              16.8

China, historically a significant butter importer from Oceania (two of 
the top three origin countries), has slowed butter imports this year. 
January-May China butter imports, 29,592 MT, declined 3.0 percent from 
the same period one year earlier, according to Eucolait. January-May, 
the range of percentage changes year to date in cumulative export 
volumes is from -3.0 percent in May, to -29.9 percent in January. 
       However, this reflects that each month, China butter imports have 
moved closer to year earlier volumes at a time when potential Oceania 
butter prices have been increasing. An observer notes the positive 
impact on Oceania dairy producer income arising from the timing and 
increasing volumes of Chinese butter imports.
Import volumes and primary origins are shown in the following table:

  		 China Butter Imports
		 Main Three Origins 
		 January-May 2017 
 
Origin          Quantity(MT)   Percent of Total  
New Zealand      25,356         85.7 
France            2,218          7.5 
Australia           847          2.9

       At GDT Event 192 on July 18, the butter all contracts price 
increased 3.4 percent.

82% BUTTERFAT:                           6,000 - 6,300           

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