Global Dairy UPDATE - Amazon AWS
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
JULY 2020
Global Dairy
UPDATE
Our Markets Our Performance
• Beginning of 2020/21 season in New Zealand. • The Co-operative Difference payment.
Australia nears end of season on improved
monthly production. EU monthly production
slows, US improves.
• New Zealand and Australia monthly exports
decline and monthly increase from US and EU.
Our Co-op
• Latin America, Asia and Middle East and Africa
imports show strong decline. China monthly • Doing our bit to support New Zealand’s small and
imports improve. medium‑sized businesses.
• Fonterra’s New Zealand milk collection for
the first month of the 2020/21 season was
14.7 million kgMS, less than 1% of the full
season forecast.
• Fonterra's Australia milk collection reached
107.8 million kgMS for the full 2019/20 season
to 30 June 2020.
Key Dates
31 July 2020 21 September 2020 20 April 2021
End of Financial Year 2020 FY20 Annual Results Compliance Date for
Announcement 2020/21 Season
1
OUR MARKETS
Global Production
Beginning of 2020/21
season in New Zealand.
Australia nears end of
season on improved
monthly production. EU
monthly production slows,
To view a chart that
illustrates year-on-year
changes in production –
CLICK HERE US improves
NEW ZEALAND AUSTRALIA EUROPEAN UNION/UK USA
2.0 %
Change for June 2020
6.0 %
Change for May 2020
0.3%
Change for May 2020
0.5 %
Change for June 2020
compared to June 2019 compared to May 2019 compared to May 2019 compared to June 2019
0.5%
Change for the 12 months
1.1 %
Change for the 12 months
0.9%
Change for the 12 months
1.3 %
Change for the 12 months
to June 2020 to May 2020 to May 2020 to June 2020
New Zealand milk Australia milk EU (including UK) milk US milk production
production¹ increased production increased 6.0% production decreased by increased by 0.5% in June,
2.0% on a litres basis in June in May compared to May 0.3% in May compared to compared to the same
compared to June last year. last year. the same period last year. period last year.
June typically represents Improving seasonal The main regions showing US milk production improved
around 1% of the season's conditions stabilised a decline in production year-on-year in June
production. production in the second were Italy (down 7.5%), following May’s slow-down
A warm start to winter half of the 2019/20 season France (2.0%) and the UK due to production restriction
and significant rainfall for and improved the outlook for (1.0%). Partially offsetting programmes put in place.
many parts of the country the 2020/21 season. this decline were increased
Milk production for the 12
have seen favourable Production for the 12 months volumes in Ireland (up 3.5%)
months to June was 1.3%
conditions for the start of the to May was down 1.1% on the and Poland (1.8%).
higher compared to the
new season. previous 12 months.
The decline is likely related same period last year.
New Zealand milk Dairy Australia has to the slow-down in
production for the 12 months moderated its milk foodservice and tourism-
to June was 0.5% lower than production outlook for related consumption.
last year. 2019/20 upwards to a drop
of just 1-3% on last year. EU milk production for the
Fonterra collections are 12 months to May was up by
Fonterra collections in
reported for June, see page 5 0.9% compared to the same
Australia are reported for June,
for details. period last year.
see page 5 for details.
1 New Zealand production is measured in litres.
Note: 2020 production numbers include one extra day of production in February as 2020 is a leap year.
2
OUR MARKETS
Global Exports
New Zealand and Australia
monthly exports decline and
monthly increase from US
and EU
To view a chart that
illustrates year-on-year
changes in exports –
CLICK HERE
NEW ZEALAND AUSTRALIA EUROPEAN UNION/UK USA
7.6%
Change for May 2020
18.4%
Change for May 2020
7.0%
Change for April 2020
14.7%
Change for May 2020
compared to May 2019 compared to May 2019 compared to April 2019 compared to May 2019
2.7%
Change for the 12 months
8.9%
Change for the 12 months
5.4%
Change for the 12 months
4.4%
Change for the 12 months
to May 2020 to May 2020 to April 2020 to May 2020
Total New Zealand Australia dairy exports EU (including UK) dairy US dairy exports
dairy exports decreased decreased by 18.4%, or exports increased by increased 14.7%, or 29,809 MT,
by 7.6%, or 21,733 MT, in 12,455 MT, in May compared 7.0%, or 35,526 MT, in April in May compared to the same
May compared to the same to the same period last year. compared to the same period last year.
period last year. This was primarily driven by period last year. May export volumes were
fluid milk products, infant driven by record volumes of
This was primarily driven by This was mainly driven by
formula and WMP, down a SMP to SE Asia, MENA and
lower volumes of WMP to increases in whey to China
combined 10,792 MT. China (up 15,596 MT), higher
China and Bangladesh, down and SE Asia, butter to US
6,944 MT, butter to China, Exports for the 12 months and MENA, lactose to China exports of lactose to SE Asia
down 6,293 MT, MPC to the to May were down 8.9%, or and WMP to Oman, up a and China (up 5,682 MT) and
US, down 3,600 MT, but 70,244 MT, on the previous combined 33,835 MT. SMP higher volume of whey to
partially offset by an increase comparable period. and fluid milk products China (up 4,815 MT).
in SMP, up 6,279 MT. partially offset this increase, Exports for the 12 months to
Declines were recorded
down 9,963 MT. May 2020 were up 4.4%, or
Exports for the 12 months to across a broad range of
100,698 MT on the previous
May were down by 2.7%, or products with SMP, infant Exports for the 12 months
comparable period, driven by
34,427 MT, on the previous formula, whey, cheese, butter to April were up 5.4%, or
SMP and WPC and lactose, up
comparable period. This was and WMP down 82,244 MT 301,234 MT, on the previous
a combined 131,966 MT, and
primarily driven by butter, and partially offset by fluid comparable period. Butter,
partially offset by decreases in
WMP and AMF. milk products, up 17,868 MT. cheese and fluid milk
whey, down 23,078 MT.
products were the main
drivers of this growth, up a
combined 223,238 MT.
3OUR MARKETS
Global Imports
Latin America, Asia and
Middle East and Africa
imports show strong
decline. China monthly
To view a chart that
illustrates year-on-year
imports improve
changes in imports –
CLICK HERE
LATIN AMERICA ASIA MIDDLE EAST & AFRICA CHINA
12.0%
Change for April 2020
14.7%
Change for April 2020
7.1%
Change for April 2020
3.2%
Change for May 2020
compared to April 2019 compared to April 2019 compared to April 2019 compared to May 2019
2.7%
Change for the 12 months
5.0%
Change for the 12 months
4.3 %
Change for the 12 months
6.2%
Change for the 12 months
to April 2020 to April 2020 to April 2020 to May 2020
Latin America dairy Asia (excluding China) Middle East and Africa China dairy import
import volumes¹ decreased dairy import volumes¹ dairy import volumes¹ volumes increased by
12.0%, or 18,444MT, in April decreased 14.7%, or decreased 7.1%, or 28,223 MT, 3.2%, or 7,818 MT, in May
compared to the same period 65,235 MT, in April compared in April 2020 compared to compared to the same
last year. This was driven by to the same period last year. the same period last year. period last year.
continued lower volumes of Decreases were recorded Decreases were recorded
The increase was the result
SMP and cheese to Mexico, primarily in WMP to SE Asia, principally in butter to Iran
of higher volumes of whey,
and butter to Chile, down a SMP and fluid milk products and Turkey and fluid milk
WMP, and lactose, up a
combined 18,583 MT. to the Philippines, and cheese product to Libya, down
combined 31,351 MT, and
to Japan, down a combined a combined 42,881 MT,
Imports for the 12 months to partially offset by a decrease
57,385 MT. and partially offset by
April 2020 were down 2.7%, in fluid milk products of
Imports for the 12 months increased volumes of SMP of
or 52,602 MT, compared 14,084 MT.
to April were down 5.0%, or 19,064 MT.
to the same period the
247,484 MT, compared to the Imports for the 12 months to
previous year. Imports for the 12 months to
same period the previous year. May were up 6.2%, driven by
April 2020 were down 4.3%,
Decreases were driven fluid milk products and WMP.
Decreases were recorded or 177,507 MT, compared
primarily by infant formula,
across SMP, WMP, fluid to the same period last
WMP, SMP and whey, down
products, and infant formula, year. This was driven by
a combined 74,096 MT but
down a combined 249,582 MT. large decreases in fluid
largely offset by increases in
milk products, cheese and
WPC, up 18,916 MT.
butter, down a combined
186,532 MT.
1 Estimates are included for those countries that have not reported data.
4OUR MARKETS
Fonterra Milk Collection
New Zealand Milk Collection
90
VOLUME (M LITRES/DAY) 75
60
45
30
15
To view a table that shows our
detailed milk collection in New
0
Zealand and Australia compared
JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY
to the previous season –
2020/21 2019/20 2018/19
CLICK HERE
NEW ZEALAND NORTH ISLAND SOUTH ISLAND AUSTRALIA
2.7%
Change for June 2020
1.2%
Change for June 2020
16.0%
Change for June 2020
2.0 %
Change for June 2020
compared to June 2019 compared to June 2019 compared to June 2019 compared to June 2019
2.7%
Season to date
1.2%
Season to date
16.0 %
Season to date
11.8%
For the 2019/20 season
1 June to 30 June 1 June to 30 June 1 June to 30 June compared to the previous season
Fonterra's New Zealand North Island milk collection South Island milk collection Fonterra's Australia
collection for the first month in June was 11 million kgMS, in June was 3.8 million kgMS, collection in June was
of the 2020/21 season was down 1.2% on June last season. up 16.0% on June last season. 6.8 million kgMS, a 2.0%
14.7 million kgMS, ahead Effects of the drought have The South Island saw a strong decrease on June last year.
2.7% on the same month begun to ease with some start to the season, with milk Full season collections reached
last season. This represents meaningful rainfall during May production well up on the 107.8 million kgMS, down 11.8%
less than 1% of the full and June. same month last year, even on the same period last season.
season forecast. allowing for the small volumes Volumes have been impacted by
A relatively mild June expected at this time of a combination of drought, high
across much of the country the season. on-farm input costs in the first
allowed some pastures to half and the highly competitive
partially recover. milk supply market, with losses
primarily to milk brokers.
Fonterra also made a conscious
decision to purchase less
third‑party milk to focus on a
value-add product mix.
Good autumn conditions for
much of Australia and across
key dairy regions in Victoria and
Tasmania have improved milk
production for the 2019/20
season and the outlook for
2020/21.
5OUR MARKETS
Fonterra Global Dairy Trade Results
Fonterra GDT results at
last trading event
21 July 2020:
0.2% USD
3,233 23.3000’ MT
Change in Fonterra’s Fonterra’s weighted Fonterra product quantity
weighted average product average product price sold on GDT
price from previous event (USD/MT)
CHEDDAR WMP SMP
1.1%
USD 3,803/MT
0.3%
USD 3,218/MT
0.6%
USD 2,697/MT
AMF BUTTER
2.8%
USD 3,870/MT
5.0%
USD 3,533/MT
Fonterra GDT sales LATEST AUCTION FINANCIAL
by destination: YEAR‑TO‑DATE
NORTH ASIA (INCLUDING CHINA)
SOUTH EAST ASIA
To view more information, MIDDLE EAST AND AFRICA 23,295 688,164
including a snapshot of the MT MT
LATIN AMERICA
rolling year-to-date results –
OTHER
CLICK HERE
The next trading event will be held on 4 August 2020. Visit www.globaldairytrade.info for more information.
Dairy commodity
1,100 0.72
prices and New
Zealand dollar trend
1,025 0.68
Financial markets are steady
PRICE INDEX
NZD / USD
as they weigh the dichotomy
950 0.64
between improving economic
performances post-lockdowns,
and an increasingly worrying 875 0.60
picture of global health
outcomes as COVID-19
800 0.56
spreads further. The NZD JUL 18 SEP 18 DEC 18 FEB 19 MAY 19 JUL 19 OCT 19 DEC 19 FEB 20 MAY 20 JUL 20
continues to find relative GDT PRICE INDEX NZD/USD SPOT RATE
stability around 66 US cents.
6Our Performance
The Co-operative Difference Payment
Fonterra farmers producing that’s paid,” says Fonterra for any changes needed in their local environment and
sustainable, high quality CEO Miles Hurrell. the future. waterways to make their
milk will be eligible for a farms sustainable for the
“We’ve always paid our The payment will replace the
new payment, as Fonterra future. It’s great to see these
farmers based on the value Farm Source Reward Dollars
announces important farmers distinguished and
that milk provides to the farmers currently earn
changes to the way it pays rewarded for their efforts
Co-operative. The reality is through The Co-operative
farmers for their milk. to produce and deliver
that the drivers of value are Difference and will work on
a product that Fonterra
From 1 June 2021, Fonterra is changing, and we need to a tiered system. The more
can capture the highest
introducing a Co-operative reflect that. Our customers a farmer achieves in The
value from. Through The
Difference payment of up want to know that the Co-operative Difference
Co‑operative Difference,
to 10 cents per kilogram products they are buying programme, the higher
we can get better, together,”
of milk solids (kgMS) if the are not only safe, but also the payment will be. The
says Northland dairy farmer
farm meets the Co-op’s produced sustainably. precise payment structure
Terence Brocx.
on-farm sustainability and will be confirmed over the
“This payment helps us meet
value targets. It’s part of next few months following “We’ve created this with
the changing needs of our
the Co-op’s strategy to add discussions with farmers our Co-operative principles
customers, so they continue
value to New Zealand milk but will be no more than in mind. All farmers
to choose our milk and enjoy
and responds to increasing 10 cents per kgMS. can participate in The
dairy as a sustainable and
demand from customers Co‑operative Difference and
nutritious choice. Nestlé’s Robert Erhard
here and around the world we’ll keep supporting them
says, “At Nestlé, how milk
for sustainably-produced “We want to deliver the through Farm Source,” says
is produced matters. Now
dairy. The payment will be innovation, sustainability and Mr Hurrell.
more than ever, people
funded out of the Farmgate efficiency needed to make
expect farmers to act as “We want farmers looking
Milk Price. the most difference to our
good stewards of the land to the future, and The
strategy and our bottom line.
“The total Farmgate Milk – safeguarding the climate, Co-operative Difference
It makes sense to financially
Price will remain the same enhancing animal welfare encourages them to
reward those farmers who
across the Co-operative, and carefully managing continue to focus on the
go the extra mile to help our
but the amount that each water and the health of soils.” things that will create the
Co-op differentiate its milk.”
individual farm is paid will highest value milk. This
“Farmers put in a lot of
vary depending on their Last year Fonterra launched helps us create higher value
effort to produce the best
contribution under The The Co-operative Difference products that stand out
quality milk possible. Over
Co-operative Difference, – a straight-forward in the global market for
recent years, large numbers
in addition to the other framework to help farmers their New Zealand-ness
of farmers have spent a
variables, like fat and protein, produce high-quality, and the sustainable way
significant amount of time
which affect the amount sustainable milk and prepare they’re produced.”
and money to improve
7Our Co-op
Doing our bit to support As a Co-operative owned
New Zealand’s small by 10,000 farming families,
Fonterra recognises the
and medium-sized enormous contribution
businesses small and medium-sized
businesses make to
New Zealand’s economy
and it’s important the
Co-op plays its part in
supporting the country’s
economic recovery.
Since March, when
New Zealand first started
dealing with COVID-19,
Fonterra has been looking at New Zealand vendors who invoices, and invoices need
ways to support employees, Fonterra spends up to to be checked in a timely
farmers and communities $300,000 per annum with, manner to ensure they
through the pandemic and and who have fewer than match the services delivered.
its after-effects. 50 employees, are eligible.
The Co-op has already been
That represents 86% of all
One of the ways Fonterra working with vendors to
the Co-op’s New Zealand
could help was by paying ensure their invoices are
suppliers and the goal is
its 3,000 small and right first time by providing
to pay 95% of eligible SME
medium‑sized vendors practical tips on what is
invoices within ten days of
more quickly and, as of required. It has also been
receiving them.
1 July 2020, the Co-op impressing on its team
accelerated payments to Fonterra’s able to do this the importance of prompt
eligible businesses so they’re because of a significant processing of invoices and
paid within 10 days from the overhaul of its vendor the flow-on effect this has
receipt of invoice. Previously, payment system in the last for vendors.
small to medium-sized few years, which has seen
The Co-op moved fast
enterprises (SMEs) were paid all vendors moved onto
to accelerate payments
on the 20th of the month electronic invoicing and
to better serve business-
following the invoice date. encouraging them to use
owners and New Zealand’s
a NZ Business Number.
Fonterra knows that getting economy. It demonstrates
This has improved invoice
paid quickly helps cashflow Fonterra’s commitment
accuracy in the Co-op’s
and keeps businesses to working with and
system which enables
running smoothly and this supporting New Zealand’s
those businesses to be paid
is a small but important way local communities, not
on time.
the Co-op can support the only during COVID-19,
country’s economic recovery. There are quite a few things but beyond.
It also demonstrates that have to be in place to
Fonterra’s commitment to ensure invoices are paid
supporting New Zealand’s quickly. For example, vendors
regional communities. need to submit correct
8Supplementary Information
Global Dairy Market PRODUCTION
The charts on the right 1,000
illustrate the year-on-year
changes in imports, exports 800
and production for a range of
LIQUID MILK (M LITRES)
countries that are important 600
players in global dairy trade.
400
The absolute size of
the bars represents the 200
change in imports, exports
or production, relative 0
to the same period the
previous year. -200
JUL 19 AUG 19 SEP 19 OCT 19 NOV 19 DEC 19 JAN 20 FEB 20 MAR 20 APR 20 MAY 20 JUN 20
Averages are shown where
NEW ZEALAND EU27 UNITED STATES AUSTRALIA AVERAGE
data is complete for the
regions presented. NOTE: Data for EU and Australia to May; New Zealand and US to June.
BACK TO SUMMARY EXPORTS
90
60
30
MT (000s)
0
-30
-60
JUN 19 JUL 19 AUG 19 SEP 19 OCT 19 NOV 19 DEC 19 JAN 20 FEB 20 MAR 20 APR 20 MAY 20
NEW ZEALAND EU27 UNITED STATES AUSTRALIA AVERAGE
BACK TO SUMMARY NOTE: Data for EU to April; New Zealand, Australia and US to May.
IMPORTS
150
100
50
MT (000s)
0
-50
-100
-150
-200
JUN 19 JUL 19 AUG 19 SEP 19 OCT 19 NOV 19 DEC 19 JAN 20 FEB 20 MAR 20 APR 20 MAY 20
ASIA CHINA MIDDLE EAST & AFRICA LATIN AMERICA AVERAGE
NOTE: Data for Asia, Middle East & Africa and Latin America to April; China to May.
BACK TO SUMMARY
SOURCE: Government milk production statistics/GTIS trade data/Fonterra analysis.
9Supplementary Information
Fonterra milk MILK COLLECTION JUNE JUNE MONTHLY SEASON- SEASON- SEASON-
(MILLION KGMS) 2020 2019 CHANGE TO-DATE TO-DATE TO-DATE
production 2020/21 2019/20 CHANGE
The table on the right
Total Fonterra 14.8 14.4 2.7% 14.8 14.4 2.7%
shows Fonterra milk solids
New Zealand
collected in New Zealand
and Australia compared North Island 11.0 11.1 (1.2%) 11.0 11.1 (1.2%)
to the previous season.
South Island 3.8 3.3 16.0% 3.8 3.3 16.0%
BACK TO SUMMARY
MILK COLLECTION JUNE JUNE MONTHLY SEASON- SEASON- SEASON-
(MILLION KGMS) 2020 2019 CHANGE TO-DATE TO-DATE TO-DATE
2019/20 2018/19 CHANGE
Fonterra Australia 6.8 7.0 (2.0%) 107.8 122.2 (11.8%)
Fonterra GDT results LAST TRADING EVENT YEAR-TO-DATE
(21 JULY 2020) (FROM 1 AUGUST 2019)
This table provides more
information on the latest Quantity Sold on GDT 23,295 688,164
results, including a snapshot (Winning MT)
of the year-to-date results.
Change in Quantity Sold on GDT (2.9%) 1.8%
over same period last year
Weighted Average Product Price 3,233 3,269
(USD/MT)
Change in Weighted Average (6.3%) 5.1%
Product Price over same period
last year
Change in Weighted Average (0.2%) –
Product Price from previous event
Fonterra GDT results 4,000 45,000
WEIGHTED AVERAGE PRICE (USD/MT)
This chart shows Fonterra
GDT prices and volumes over 3,700 38,000
QUANTITY SOLD ( MT)
the past 12 months.
3,400 31,000
3,100 24,000
BACK TO SUMMARY 2,800 17,000
2,500 10,000
JUL 19 AUG 19 SEP 19 OCT 19 NOV 19 DEC 19 JAN 20 FEB 20 MAR 20 APR 20 MAY 20 JUN 20
WEIGHTED AVERAGE PRICE QUANTITY SOLD
10Glossary
AMF kgMS Season
Anhydrous Milk Fat. Kilogram of milk solids, the New Zealand: A period
measure of the amount of of 12 months to 31 May
BMP fat and protein in the milk in each year.
Butter Milk Powder. supplied to Fonterra.
Australia: A period of
DIRA MENA 12 months to 30 June
in each year.
Dairy Industry Restructuring Middle East – North Africa.
Act 2001 (New Zealand).
MPC SMP
Farmgate Milk Price Skim Milk Powder.
Milk Protein Concentrate.
The price for milk supplied in WMP
New Zealand to Fonterra by Non-Reference Products
Whole Milk Powder.
farmer shareholders. All dairy products, except
for Reference Products, WPC
Fluid Products produced by the NZ
Whey Protein Concentrate
The Fonterra grouping Ingredients business.
of fluid milk products
(skim milk, whole milk Reference Products
and cream – pasteurised The dairy products used
or UHT processed), in the calculation of the
concentrated milk products Farmgate Milk Price, which
(evaporated milk and are currently WMP, SMP,
sweetened condensed milk) BMP, butter and AMF.
and yoghurt.
GDT
Global Dairy Trade, the
online provider of the twice
monthly global auctions of
dairy ingredients.
11You can also read
