NZ commodity prices lift in May as horticulture shines

Friday 3rd June 2016

New Zealand commodity prices lifted in May, led by horticulture.

The ANZ Commodity Price Index gained 1 percent in May to 231.1 and was down 12 percent on an annual basis. A lower New Zealand dollar, except if exporting to Australia, saw the New Zealand dollar index advance 2.5 percent in May, although it was down 3.5 percent on an annual basis.

"In recent months, prices look to have found a floor that they are now bouncing along," ANZ Bank New Zealand agri economist Con Williams said in his report.

Horticulture prices led the gains, lifting 6.2 percent in the month with the start of new season crop sales.

"It looks like a good start to the new season for pipfruit and kiwifruit growers, with prices for both lifting in May," Williams said. "Solid prices combined with record-sized crops will see these sectors climb further up the export league tables this year. Back-to-back solid returns are creating momentum for new investment and expansion from orchards through to pack houses and cool stores."

Across other commodities, seafood prices rose 1.1 percent, forestry increased 0.9 percent, and meat advanced 1.5 percent. In aggregate, dairy prices were stable and aluminium prices slipped a touch, down 1 percent, Williams said.

Beef led the meat price gains, up 2.8 percent, while wool improved 1.5 percent. The other categories of lamb, venison and skins were largely unchanged.

Within dairy, skim milk powder slid 1.8 percent due to large European stocks, while butter sank 1.4 percent. The other categories of whole milk powder, cheese and casein were largely unchanged.

In the forestry category, log prices advanced 1.2 percent while wood pulp increased 1.4 percent. In the seafood category there were lifts for snapper and squid prices

BusinessDesk.co.nz

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