2 Sep 2011

Commodity prices fall for third month in a row

4:19 am on 2 September 2011

Commodity prices have fallen for the third month in a row.

The ANZ Commodity Price Index fell 1.2% in August, with lower prices for milk powder, logs and aluminium leading the decline.

However, when converted back into New Zealand dollars, returns at the farmgate remained unchanged due to falls in the currency following plunges on global stock markets last month.

ANZ Bank economist Steve Edwards says prices remain robust, and are just off record highs.

He says there has been turmoil on the global financial markets which has rubbed off onto commodity markets, but compared to a year ago all commodity prices are higher than they were, so it's not all doom and gloom.

Mr Edwards says milk powder was down 6% in the month and since its peak it has dropped about 16%, but compared to a year ago milk prices are still around 14 to 20% higher.

He says international seafood prices have climbed to new highs.