New Zealand producers' input and output prices fell in the second quarter of this year as dairy prices declined.
Producer output prices, which measure the prices received by New Zealand producers, fell 0.5 percent in the three months ended June 30, Statistics New Zealand said. Input prices, representing the prices of goods and services used by local producers, fell 1 percent in the quarter.
Prices for dairy products have weakened this year as farmers increased production to take advantage of higher prices, resulting in a build up of inventory in China and falling demand in some emerging markets.
Fonterra Cooperative Group's GlobalDairyTrade auction tomorrow morning will be closely watched after dairy product prices slumped to the lowest level since October 2012 in the last auction.
Lower prices for raw milk in the second quarter led an 11 percent decline in the prices received by dairy cattle farmers and a 9.4 percent decrease in input prices paid by dairy product manufacturers, the statistics agency said today.