NZ commodity prices fall for 7th month in Sept, ANZ says

NZ commodity prices fall for 7th month in Sept, ANZ says

By Suze Metherell

Oct. 2 (BusinessDesk) - New Zealand commodity prices fell for a seventh consecutive month to an 18-month low in September, led by declining dairy prices.

The ANZ Commodity Price Index slid 1.3 percent last month, a slower pace than August's 3.3 percent drop, and is now 13 percent below February's record high. Skim milk powder dropped 14 percent to its lowest level since June 2012, while butter prices declined 8 percent, whole milk powder fell 5 percent and cheese slipped 3 percent.

The survey comes after Fonterra Cooperative Group's GlobalDairyTrade auction recorded the average winning price for dairy products at a five year low. The price of dairy, New Zealand's largest export, has slumped nearly 50 percent from a peak in February amid increased supply as stocks build across the world due to Russia’s import ban and weak demand from China.

Among other export commodities, apples dropped 11 percent on limited volumes in the European market. Pelts fell 5 percent, while wool and casein prices slipped 2 percent and aluminum prices eased 1 percent.

Meanwhile, the price of beef rose for the fifth consecutive month gaining 10 percent in September to sit at a series record, ANZ said. Demand in the United States, New Zealand's number one market for its meat, has been pushing up the price of beef. The international export prices of sheepmeat, seafood and venison were unchanged, as was the price of wood pulp and lumber. Kiwifruit prices edged up 2 percent in the month.

The ANZ NZD Commodity Price Index, which shows the price movements in New Zealand dollars increased 1.6 percent in September, as the kiwi dollar fell against all currencies of major trading partners, except Japan. The trade-weighted index fell some 3.9 percent in the month, with a sharper decline towards the end of the month after Reserve Bank governor Graeme Wheeler jawboned the currency. If the monthly average of the currency was calculated at current levels, the increase in the NZD Index would have been close to 3 percent this month, ANZ said.

(BusinessDesk)

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