Weak conditions for dairy exports will continue, according to Tim Hunt, senior analyst at Rabobank. Rabobank have released their Dairy Quarterly report, which shows that low supply levels have not changed low prices for dairy. "Milk production growth ground to a halt in most key export regions of the world as farmers responded to the combination of poor milk prices and still-high input costs," said Hunt. Demand was also weak, but partially offset by intervention buying by governments in the northern hemisphere and purchases by China. "The impact of these two drivers has been critical in providing a market floor for dairy prices," said Hunt. "In total, China and intervention authorities in the US and the EU bought just under 200,000 tonnes of milk powder in the first quarter of this year - around 25 percent of normal international trade volumes in those products over the period." For Australian dairy exporters, this meant an increase of 30 percent in the first quarter of this year compared with 2008, which had the effect of clear high stock levels from late last year.