According to senior agricultural analyst of Rabobank New Zealand, Oceania milk collections have taken a hit this season. New Zealand’s milk collections fell by 6.5% for May 2022. This brings final tallies for season 2021-2022 to a drop of 4.1% year-on-year. Australia’s national production was down 6.6% year-on-year for April 2022. Milk collections stand at -3.4% for the known season to-date. There are some positive drivers that should support stabilization in Australian milk supply in 2022-2023. Rabo Research expects dairy commodity prices to remain volatile over the coming months, with weak global milk supply drivers supporting prices to remain at elevated levels. But higher farmgate milk prices across most regions have not guaranteed production growth, Rabobank points out. Higher corn and soybean prices and weather disruptions in certain regions have put a handbrake on milk supply growth. Overall inflation pressures in energy, fuel, and wages are also impacting profitability across the Big-7 (the EU, the US, New Zealand, Australia, Brazil, Argentina, and Uruguay), despite higher milk prices. Rabobank expects the milk supply to grow again in the second half of 2022. Shipments for the year to May are lower by 26% compared to last year, while May shipments alone were almost halved compared to last year. Dairy prices dropped at the latest global dairy auction in July. The global dairy trade (GDT) price index was down 5% for an average price of US$4,166 per ton. USDA expects EU milk production will drop by over 430,000MT in 2022.