New Zealand commodity prices fell at their fastest pace on record in July, notching up a fourth straight month of declines to the lowest level in almost six years, led by dairy.
The ANZ Commodity Price Index for July fell 11.2 per cent to the lowest level since October 2009, and is 27 per cent below year earlier levels. Thirteen of the 17 main commodities declined.
The drop was led by a slump in dairy prices, which are down 23 per cent from June to the lowest level in more than 11 years. Whole milk powder prices fell 35 per cent, while skim milk powder declined 11 per cent and casein dropped 9.8 per cent. Cheese and butter prices also declined. Excess global supply and lacklustre demand is pushing down prices for dairy products, the country's largest export commodity, reducing farm incomes and weighing on economic growth.
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"International supply and demand imbalances remain as a significant headwind for dairy exporters," said ANZ Bank New Zealand agri economist Con Williams.