Dairy prices at 18 month low

Commodity prices are at an 18 month low after a  record fall of 7.4% last month.

The ANZ Commodity Price Index had its largest decline last month since it was launched in 1986, and was down nearly 11 per cent on a year earlier.

Nine of the 13 commodities recorded lower world prices in October.

Beef had the largest fall, down 17.7 per cent from September, followed by skins (16.2 per cent), aluminium (down 16 per cent) and wool (down 12.6 per cent).

Dairy prices had a smaller decline – down 9.9 per cent – but dominated the index.

The fall in dairy prices reflected softer commodity prices in general as investors lost confidence amid world market and economic turmoil.

Also depressing dairy prices was increased production from “fringe” dairy exporting nations, such as the United States, which were starting to increase production, said ANZ economist Steve Edwards.

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