Commodity prices fall for fifth month
Five months of commodity prices decline.
New Zealand commodity prices fell for a fifth straight month in August to their lowest level in 11 years.
The fall was led by a decline in dairy prices
The ANZ Commodity Price Index slid 5.2% in August, following a 5.5% decline in July. The index is 23.5% below year earlier levels.
The drop was led by a slump in dairy prices, which fell 10.1% from July. Skim milk powder fell 16% while whole milk powder dropped 11.2% and international prices for butter, cheese and casein also declined.
However, dairy product prices rose 10.9% in the GlobalDairyTrade auction overnight, taking the gain over the past two events to 23% after nearly six months of declines.
ANZ chief economist Cameron Bagrie says the recent lifts in dairy auction prices "suggest the worst may be behind us.”
Meanwhile, prices also fell across other commodities last month. Forestry prices slid 6.1%, led by a 10.4% fall in log prices reflecting weaker demand from China and the wider Asian region. Timber and pulp prices were flat.
Horticulture prices fell 1.6% as both kiwifruit and apple prices declined. Aluminium prices dropped 5.6%, and are 22.9% lower than the year earlier. Prices in the seafood sector were unchanged.
Meat prices bucked the trend, increasing 1.6% as a 6.6% gain in beef prices and a 1.4% lift in wool prices offset a 2.2% decline in lamb prices and a 2.3% fall in skins.
The NZD index fell 3.9% in August to the lowest level since February 2013.
While declines in the New Zealand dollar against the greenback, the yen and the euro over August helped to partly counter the fall in world commodity prices, further declines are likely to be required to support New Zealand dollar returns in the future, the ANZ says.
(BusinessDesk)
Tina Morrison
Wed, 02 Sep 2015
Wed, 02 Sep 2015
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Commodity prices fall for fifth month
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