Tassie milk mark set for record high

TASMANIA’S milk production is likely to break 900 million litres for the first time, helped by favourable early autumn rain across most dairying regions.

Dairy Australia’s latest milk production report shows, for March, Tasmania was up 11.4 per cent on last year and is only behind South Australia (12.8 per cent) in growth.

DairyTas executive officer Jonathan Price said assuming Tasmania gets to 900 million litres by June 30 this year it would give the state 7.7 per cent growth for the year.

“Anecdotally it looks like 5 per cent of this growth is attributed to a more favourable season allowing for increased production by farmers,” Mr Price said.

“The balance is attributed to recent investment on farm to increase production and from new conversion farms.”

Mr Price said in the year to date Tasmania is 6.6 per cent up on last year. Milk production between July and March this year was 707.7ML.

“Compared to the record year in 2014-15 for the same period it was 700.5ML. That record year finished at 891ML.

“We are likely to break 900ML for first time this year. We’ve also had more favourable input costs, which has helped farmers.”

Dairy is the largest agricultural sector in Tasmania, contributing more than $1 billion to the state economy each year. There are 440 farms in the sector, with dairy heartlands being in the North-West and North-East.

Nationally milk production is at 7322ML for the year to date at March, up 3.4 per cent.

Mr Price said global markets have remained stable.

A focus on milk quality and herd fertility has helped Wayne and Caroline Saward, of Blythe Vale near South Riana, in the North-West, build their dairy operation and win the Tasmanian Dairy Share Farmer of the Year award.

Mr Saward said the biggest thing is having good staff and consistency in the dairy.

The property has a milking area of about 240ha with about 190ha irrigated. They milk 800 cows divided into two herds.

According to a new report Australian Dairy — Let The Big Milk Battle Begin, by agribusiness banking specialist Rabobank, the storm clouds hanging over the global dairy market are expected to clear in late-2018.

The report says competition for milk is set to intensify in Australia as the “battle begins”, steering domestic producers towards a profitable 2018-19 season.

Report author, Rabobank senior dairy analyst Michael Harvey, said the battle between two global dairy giants looms large on the horizon, as Saputo’s quest to win back milk supply begins and Fonterra maps out further capacity expansions.

“Smaller and newer dairy players are set to continue actively recruiting milk to secure their share of the milk pool,” Mr Harvey said.

“It will be these competitive pressures for milk supply, which are likely to intensify next season with Saputo’s acquisition of Murray Goulburn, that will translate into higher premiums being passed to farmers and help compensate for the lower commodity price.”