Australia and NZ Agribusiness Review May 2008

Rabobank's Australia and New Zealand Agribusiness Review May 2008

I thought you might be interested in the May 2008 Australia and New Zealand Agribusiness Review from Rabobank.

Prepared by our Food & Agribusiness Research and Advisory division, the report provides monthly commentary on New Zealand and Australian economic and agricultural conditions. Highlighted in this report:

• The serious drought in the north Island of New Zealand broke in April with widespread rain, whilst the south Island remained relatively dry. After a promising summer period rainfall across some of Australia's key cropping areas was scant in April with farmers in some areas increasingly concerned about a third consecutive year of poor growing conditions.

• Both the RBNZ and RBA left official rates on hold in April, citing a combination of the impact of recent official and unofficial rate rises (Australia), skyrocketing oil prices, slowing domestic demand and ongoing global uncertainty as the key reasons for a wait and see approach.

• New Zealand lamb prices firmed in April as global prices began to respond to tightening sheep meat supplies around the world. Prices sit 13-17% higher than the same time last year despite the New Zealand dollar sitting approximately 5 cents higher than the same time in 2007.

• Global dairy commodity prices appear to have stabilised in April following their recent slide off record highs. SMP had been hardest hit due to record export shipments from the EU and US in the first quarter of 2008.

• New Zealand wine exports for the year to March were up an impressive 18%, with export value climbing 16%. Australian wine exports fell 6.7% in the year to March 2008, while value fell by 2.2%.

ENDS

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