A stronger New Zealand dollar has taken the gloss off the country's strong export earners.
The ANZ World Commodity Price Index dropped just 0.1 percent in May, however taking into account the dollar it fell 1.3 percent.
Dairy prices continued to fall, dropping 5.1 percent last month and are now 15 percent lower than a year ago.
Meat and fibre gained 3.2 percent reversing the downward trend that had persisted over the past six months, mainly due to a strong demand for beef.
The Horticulture Index was stable and forestry regained its losses of recent months to lift 7.4 percent in May.
Aluminium prices stabilised following a sharp drop in prices in April but demand is expected to remain weak due to the reduction in demand for aircraft and cars.
Shipping costs are expected to remain low in the coming months due to reduced demand and low fuel prices.
ANZ agri-economist Susan Kilsby said commodity prices had held up extremely well so far given global market volatility, but prices were expected to ease in the months ahead.
She said the growing strength of the dollar was having an effect but it may not last.
"Just for the moment it is holding up and that is reducing the returns that we get back here in New Zealand."
She said a shortage of supply and markets was responsible for holding up prices at the moment for some sectors, "rather than anything demand driven".
RNZ
