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Global Shortage Of Milk Supply, The Average Prices Doubled
Experts believe that to meet the global demand for dairy products, and only rely on China and emerging producing countries such as Argentina. The benefits of milk prices can increase production in these countries. In addition, the United States will become the new dairy export powerhouse. At present, the international market, milk prices have surpassed the United States over government subsidies after milk prices, the U.S. dairy exports become profitable.
Over the past two years, climate change, bio-fuels industry, corn feed prices and other factors, so that the global average price of milk has doubled. In the United States in some areas, milk and even more expensive than petrol.
Dairy Australia international affairs manager of Philip Gould said that this was a milk shortage in the world.
Analysts believe that the biggest reason for higher milk prices, and iron ore, copper ore and other traditional commodities prices is the same reason: the strong growth in the global economy; from China, India, the Middle East to Latin America, incomes increase, so that millions of people out of poverty, among the middle class. In these areas, milk and cars, along with flat-panel TVs has become a symbol of prosperity and the well-off families living an indispensable food.
In addition, milk is baby food, chocolate, ice cream and cheese the main raw material. New Zealand's leading dairy company Fonterra Co-operative Group economist Alex Duncan said the milk to meet the global demands, and an annual increase in milk production in New Zealand.
According to the German International Farm Comparison Network (International farm comparison network, hereinafter referred to as "IFCN") data, New Zealand is the world's largest milk producer, is one of the largest dairy exporter. IFCN economists believe that, at present, some countries (regions) of dairy shortage crisis is likely to spread around the world, so milk prices will remain high or even rise further.
The milk industry in the chain are in the enterprise will not think this is good news. For example, because the prices of raw milk, even raising the price of its chocolate production, can not hindered Hershey Foods Corporation (Hershey) 2006-year profit fell 96%.
The United States, Europe and Australia are hard-pressed
The same for scarce goods, milk and oil difference is: you can not store them after the milk bucket. It is the perishable food products. Even milk stored, but also the retention period. Therefore, every year the world's only 7% of the dairy products can be sold abroad, most of the rest of the domestic market. This shows that the dairy trade is more subject to geographical constraints than oil.
Chocolate manufacturers, large supermarket chains that require large quantities of milk business, often associated with dairy products, long-term contracts signed by enterprises to circumvent the sudden shock of milk prices. Therefore, the milk shortage in the past, countries have different, not all countries, consumers can feel the impact of the shortage of milk.
In the past the United States and Europe has sufficient inventory cheese, butter and milk powder in other areas there is a shortage of dairy products, often imported from the United States and Europe to relieve the pressure. Present, however, stocks in the United States, dairy products, domestic consumption growth due to depletion, while the EU new member states due to the increasing milk supplies are becoming increasingly strained.
Australia was a dairy export powerhouse. But successive years of drought in large areas of dead grass, the country's milk industry has suffered catastrophic damage. Many people are worried that Australia's drought is not temporary, but global warming, and its milk industry will no longer be likely to return to the past.
In the dairy production rising in China, domestic demand growth even more than the output growth. , According to IFCN statistics, at present, China's per capita consumption of milk for more than 25 liters / year, compared to only 9 liters in 2000. Thus, while China is now among the world's largest producer of milk out, it is still the world's largest dairy importer.
In some other dairy-producing countries, rising dairy prices prompted the Government introduced price control policy. In Argentina, the Government has the export of dairy products for their own taxes; in 2007, India has banned milk powder exports; the South African government on the country's products to implement a fixed-price policy; Germany also pay close attention to milk and butter prices.
United States and other countries, or into a "market savior"
However, milk prices have not brought tangible benefits to the producers. In New Zealand, in 2007 the income of farmers increased by 24%. However, export growth, asset prices and farmer income, have contributed to New Zealand's worsening inflation, forcing the central bank will soon be New Zealand's benchmark interest rate to 8.25%. High interest rates also led to New Zealand currency against the U.S. dollar rose to the highest point in 22 years.
With the New Zealand currency appreciation, dairy exports to earn foreign exchange in the currency conversion and then decreased. The export boom has also led to labor shortages in New Zealand highlights the problem, so that labor costs continue to soar. The high land prices have also hindered the new milk producers to enter. These are obstacles to increase milk production in New Zealand.
Experts believe that to meet the global demand for dairy products, and only rely on China and emerging producing countries such as Argentina. The benefits of milk prices can increase production in these countries. India has announced that it will in October 2007 to lift the ban on milk powder exports.
Some people believe that the U.S. will become the new dairy exporting countries - the international market, milk prices have surpassed the United States over government subsidies after milk prices, the U.S. dairy exports become profitable.
The industry believes that the U.S. Midwest and Europe could do to improve milk production, but this would require 1 to 2 years, and this implies the need to consume more increasingly expensive corn and grain. Therefore, even if the world's milk needs have been met, the price will remain high.
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