New Zealand Commodity Export Prices Fall on Rising Currency

Feb. 1 -- New Zealand commodity export prices fell for the first time in three months in local currency terms in January amid a decline in returns for dairy products and a gain in the nation’s dollar.

Prices in local dollars fell 1.2 percent from December, according to an index calculated by ANZ National Bank Ltd. New Zealand’s dollar rose to a two-month high during January while dairy prices fell in world markets for the first time in seven months, the Wellington-based bank said in a statement.

Milk powder prices dropped in January for the first time since July, Fonterra Cooperative Group Ltd., the world’s largest dairy exporter, said on Jan. 6, citing the results of its monthly auction. Demand for powder has eased as companies have rebuilt inventories, Auckland-based Fonterra said.

Dairy prices fell 2 percent on world markets in January, ANZ said. After adjustment into New Zealand dollars, the price declined 4.1 percent.

Seafood, fruit and vegetable prices also dropped last month, the bank said. In the case of seafood, the currency’s gain wiped out a 2.5 percent jump in world prices.

From a year earlier, prices in the local currency have gained 5 percent, today’s report showed. Still, prices on world markets have surged 37 percent, and the New Zealand dollar’s gains have all but wiped out those benefits.