Higher dairy prices pushed ANZ's commodity price index up 1.8 per cent last month.

But outside dairy products, which make up 47 per cent of the index, prices were soft especially in the meat and fibre sector, said ANZ economist Con Williams.

Whole milk powder had led the charge among dairy products, as dry conditions and the low milk price curtailing end-of-season milk supply had turned market sentiment around.

But prices for other commodities fell for the third month in a row, he said. Only venison managed a slight improvement and that was off a low base.


"Beef prices fell in the United States, given high Australian and New Zealand supply, port disruptions, weaker demand due to the recent cold snap and increasing poultry and pork supply. The port disruptions have been resolved, but importers have very high stocks at present, which will take some time to clear."

Williams said most of the horticulture sectors had only just begun picking this season's crop.

"Early price indications for Europe are soft due to the Russian sanctions flooding the market with domestic supplies, but Asia looks fairly solid at this stage," he said.

Forestry prices were a bit softer in February. Log prices were unchanged but had started to come under pressure in China recently as rising inventories and sharply lower Russian log prices weighed on sentiment.

Overall the index is 16.6 per cent down on a year ago.

In New Zealand dollar terms the index rose 7.3 per cent last month, to be 7.4 per cent lower than a year ago.

Most of that was courtesy of the fall in the kiwi dollar to US73c early in the month.

"The drop in the New Zealand dollar looks to have been only brief, though, with the trade-weighted index higher over late February and into March," Williams said.