(Yicai Global) Oct. 30 -- Chinese raw milk producers' third-quarter financial results showed signs of troubles despite climbing milk prices.

After slumping in May last year, global milk prices rose more than 70 percent to USD38.7 (CNY2.54) for 100 kilograms in August, per International Farm Comparison Network (IFCN) data.

Due to falling global milk prices, lots of cheap imported large-package milk powder and ultra-high temperature milk has flooded into China since 2014, squeezing out domestic raw milk supply and weighing on domestic raw milk producers. While third-quarter results show things picked up for Chinese fresh milk suppliers, they still face difficulties.

China Modern Dairy Holdings Ltd. [HK:1117], the country's largest raw milk supplier, posted revenues of CNY3.21 billion in the first three quarters of this year, on par with the same period of last year, per its third-quarter results. Its net losses were CNY720 million in the first nine months, compared with first-half losses of CNY670 million. Losses for the first three quarters were 151 percent larger than those of the same period last year, though losses declined quarterly.

Xinjiang Western Animal Husbandry Co. [SHE:300106] reported revenues of CNY540 million for the January to September period, up 7 percent annually, and net profits of CNY80 million, down 40 percent from a year earlier, in its third-quarter results. Its quarterly declines narrowed substantially in the third quarter.

China imported 600,000 tons of large-package powder in the first nine months, an increase of 20 percent from a year ago, at an average price of USD2,990 per ton, up 24 percent annually, customs data show. Imports rose 150 percent annually to 41,000 tons in September.

Milk prices have entered another round of upward movement, the gap between international and domestic fresh milk prices is changing, the domestic supply glut of raw milk is shrinking, and hard times will soon be over for raw milk suppliers, market experts said.

As a new cycle has begun in the global dairy industry, milk prices have increased sharply at major milk-producing countries such as New Zealand and the Netherlands, but there will be a lag of at least six months for rising prices to pass through to the Chinese market, Li Shengli, lead scientist of the national dairy industry's technical system, told Yicai Global at a forum on the sustainable development of China's dairy industry organized by China Dairy magazine last week.