New Zealand agribusiness August 2024: Balance for both markets and weather
Here are the main highlights for some of New Zealand’s key commodities and economic influences for this month. The full report provides an overview of the developments to watch in the upcoming weeks.
PLEASE NOTE
Our Food & Agribusiness research is now available on our new website: knowledge.rabobank.com. This website will no longer be updated after September 5, 2024. Please visit knowledge.rabobank.com and sign up to access all our latest research.
Dairy: Narratives are shifting in dairy markets – from farmgate milk prices, to feed costs, to profitability for farmers across the globe. RaboResearch expects to see a supply response but thinks markets will be able to absorb the additional milk.
Beef: Beef continues its positive run with processor procurement adding further upside to farmgate pricing. The medium-term general market outlook remains strong.
Sheepmeat: The AgriHQ SI lamb price hit NZD 7.70/kg cwt, with processors likely aiming to draw out the last of the old season lambs. Eyes now focus on the green shoots of the new season.
Farm inputs: Month-on-month price movements were modest across fertilisers as uncertainty regarding global demand kept prices trading within a range. On the supply side, China remains absent from the export market and natural gas prices remain volatile.
Interest rates and FX: The RBNZ kicked off its rate cutting cycle in August, but rates remain at restrictive levels. We expect consecutive cuts at the next three meetings before the pace starts to slow in Q2 next year.
Oil and freight: Oil prices continued to moderate in August and could slide further in September as demand shows signs of easing. Seasonal demand patterns are expected to place upward pressure on freight rates in the near term.
