Dairy and aluminium exports have buoyed a 1% rise in the monthly ANZ commodity price index, which has also benefited from prices boosted by global trade tensions.
The forestry sector also managed its 20th consecutive month of growth; albeit a small gain.
Of the 17 indexed commodities seven rose, five were unchanged and four declined, ANZ Agri-economist Con Williams said.
“The main thrust was provided by the dairy complex, while aluminium provided a supporting act as trade tensions and geopolitics boosted prices,” he said.
However, the meat and fibre group of commodities provided a drag as beef and skin prices fell.
The $NZ lost ground against its US counterpart and the British pound, it moved higher against most major trading partners, which helped boost Kiwi dollar returns 1.2% month-on-month, lifting annual growth to 5.8%.
Williams said dairy prices had continued to push higher in April, up 2.7% month on month and 7% against a year ago. The gains were due to a range of influences, including what appeared to be sluggish European production across some of the larger export regions of Germany, France, the UK and Netherlands during their seasonal peak, which also happened a year ago.
The other major influence appeared to be broad-based demand creating inter-market competition, Williams said.
Aluminium prices jumped 8% because of trade and geopolitical tensions, especially because of US trade sanctions on Russia, he said.
“China's clampdown on excess production and capacity restrictions to improve air quality continue to support prices,” Williams said.
Forestry prices “ground higher” by 0.2%, marking 20 months of consecutive gains, with domestic and export log and lumber prices still well above last year because of solid demand both domestically and from China, he said.
“However, upward momentum has flattened out recently,” Williams noted.
Beef prices fell 4.2% on increased manufacturing beef supplies from NZ, Australia and the US, while venison and sheep meat prices remained stable; at high levels, he said.
Wool prices continued to lift off earlier lows, up 2.6% monthly and 11.7% on a year ago. Wool prices were driven by bargain hunting, with demand boosted by current price competitiveness versus substitutes.
“Higher demand has been driven by China, with season-to-date exports up 32%,” Williams added.
*Simon Hartley is senior business reporter and assistant chief reporter for the Otago Daily Times.