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NZ commodity price index holds steady in February as falls match rises

Friday 2nd March 2012

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The ANZ commodity price index of New Zealand exports was unchanged during February, with declines in some areas balanced by gains in others.

Dairy prices in aggregate fell 1 percent, seafood dropped 4 percent and the price of skins recorded the largest fall of 10%. Venison prices also dropped 3 percent. This means seafood prices are now at a 13-month low, wool’s back to an 11-month low and skins and casein prices both dropped to 10-month lows.

The overall index was held in balance by logs lifting 4 percent, as aluminium, beef and kiwifruit prices all gained 3 percent and lamb lifted 1 percent. Beef had its third successive monthly price increase, and is now at a record new high.

A strengthening New Zealand dollar against all the country’s trading partners saw a 1985 post-float high against the pound and the euro.

This translates into a weakening of the ANZ NZ Dollar Commodity Price Index of 4 percent in February, dropping to a two-year low for this series.

ANZ economist Steve Edwards said while the NZ dollar-priced series has now fallen 17% from its March 2011 peak, it remains 13% above its post-2000 average.

Edwards made special note of a 24% easing in wood pulp prices over the past six months, following two years of increasing prices for the paper-making raw material. In the 12 months to January 2012, wood pulp exports totalled $660 million.

This represents 15% of all New Zealand’s forestry-related exports or 1.4% of the country’s total merchandise exports.

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