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Dairy giant Fonterra exports record volumes, but 2016 outlook glum
NEW Zealand dairy giant Fonterra exported a record 300,000 tonnes of dairy products to overseas markets in December, a 10 per cent increase on its record exports the same month in 2014, Reuters reports.
But the new record will be hard to beat this year as reduced milk volumes begin to impact production levels, said the dairy cooperative's ingredients director Kelvin Wickham.
Fonterra, the world's biggest dairy exporter, expects a six per cent year-on-year reduction of milk volumes by at least six per cent this season as farmers respond to lower milk prices and after dry conditions hit parts of New Zealand.
After rising steadily since 2008 to scale record highs in 2013, global dairy prices have dropped sharply due to slowing economic growth in China and global oversupply of milk products. China is one of New Zealand's top export markets and the world's largest importer of whole milk powder.
Weaker dairy prices have put significant pressure on New Zealand farmers. The central bank now estimates around 80 per cent of dairy farmers will have negative cash flow in the current season, posing a risk to the economy.
But the new record will be hard to beat this year as reduced milk volumes begin to impact production levels, said the dairy cooperative's ingredients director Kelvin Wickham.
Fonterra, the world's biggest dairy exporter, expects a six per cent year-on-year reduction of milk volumes by at least six per cent this season as farmers respond to lower milk prices and after dry conditions hit parts of New Zealand.
After rising steadily since 2008 to scale record highs in 2013, global dairy prices have dropped sharply due to slowing economic growth in China and global oversupply of milk products. China is one of New Zealand's top export markets and the world's largest importer of whole milk powder.
Weaker dairy prices have put significant pressure on New Zealand farmers. The central bank now estimates around 80 per cent of dairy farmers will have negative cash flow in the current season, posing a risk to the economy.
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