The price of raw materials produced in New Zealand posted their 12th straight gain last month, led by rising lamb, skins and beef, according to the ANZ Commodity Price Index.
Prices gained 3.8 per cent in February from a month earlier, for an annual gain of 49 per cent, as demand for New Zealand's so-called soft commodities remained upbeat after the global financial crisis sapped companies' appetite to maintain their inventories. Six commodities recorded higher prices, while three, including dairy declined.
"The current index reading of 220.3 is the second highest for the series and not far below the all-time high of 223.5 recorded in July 2008," said economist Steve Edwards in his report.
New Zealand's commodities were underpinned by surging dairy prices last year as milk powder jumped 95 per cent in the second half of last year, though it's since pared some of its gains and will likely report a third monthly decline when Fonterra's online auction takes place on Tuesday in the U.S.
Still, about a quarter of these gains were eroded by a strong kiwi dollar, which eased relative to the country's major trading partners last month. The kiwi slipped to 69.74 US cents from 69.81 cents this morning.
Edwards said the drop in the kiwi "exacerbated" a rise in the NZ dollar valued commodity price index, which rose 7.9 per cent to 165.8, the second highest recorded level.
Dairy prices fell 7.6 per cent last month, just behind aluminium's 7.8 per cent fall, with venison dropping 0.7 per cent.
