January 30, 2020 / 8:49 PM / a month ago

UPDATE 1-Fonterra's Australia milk output falls 3.4% in November

(Adds details on results, background on Australia weather conditions)

Jan 31 (Reuters) - New Zealand dairy giant Fonterra said on Friday milk production in its Australian operations dropped 3.4% in November, while milk collection in the region fell 13% in the last month of 2019.

The world’s largest dairy exporter cited poor seasonal conditions, high farm input costs, fewer cows and “intense competition” for milk for the declines in Australia.

Bushfires started earlier than usual in September in Australia, destroying more than 11.7 million hectares (117,000 sq km) and killing at least 33 people and about 1 billion animals.

Further reductions in Australia’s herd were predicted, Fonterra said.

Meanwhile, the company said production on a milk solid basis in December rose slightly in New Zealand, helped by favorable weather conditions in the South Island.

Milk solids are the amount of fat and protein contained in the milk supplied to Fonterra.

Dairy import volumes in China, one of Fonterra’s key markets, jumped 12.4% in November, the company said.

Global dairy companies have been benefiting from strong Chinese demand, as buyers in the mainland prefer internationally made whole milk powder and infant formula to their local counterparts. (Reporting by Shriya Ramakrishnan in Bengaluru: Editing by Sriraj Kalluvila)

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