Chinese imports of milk powder to increase by 43 per cent
WE’RE in the midst of a milk-powder boom and the dairy industry is set to reap the rewards.
Despite softening global dairy prices, the volume of Australian milk powder exports has increased 16.5 per cent year-on-year for the July to August period, according to Rural Bank’s latest Australian Dairy Update.
The increase is being driven by high demand from Malaysia and China.
As a result, Rural Bank’s Ag Answers team is now forecasting a 43 per cent increase year-on-year in the volume of Australian milk powder imported by China for the 2017 calendar year.
Its dairy update revealed China’s import pattern changed dramatically in the past few months with a 53 per cent surge in Australian milk powder imports recorded for the January to August 2017 period.
Rural Bank general manager for agribusiness Andrew Smith said the increase in Chinese demand for Australian milk powder was encouraging for Australian dairy farmers and could allow processors and producers to capitalise on any future increases in global dairy prices.
“The out-of-cycle rise in Chinese demand for Australian milk powder, combined with year-on-year increases in the value of dairy exports to Singapore and Malaysia, means that three of the five main Australian export markets are performing well despite lower global prices,” he said.
“This is good news for dairy farmers and highlights once again the strong appetite and demand for Australian dairy products throughout Asia.”
According to the Australian Dairy Update, national milk production is also tracking slightly above this time last year, with South Australia and Victoria leading the way with 12.7 per cent and 0.9 per cent increases respectively.
Following an extremely dry September, welcome rain fell across most dairy regions of Australia in October.
Weather conditions are expected to improve further in the coming months according to the Bureau of Meteorology.
“Milk production increases will become more feasible as October rains support good pasture growth,” Mr Smith said.
“There is also now a good chance of above average rainfall occurring across many dairy regions this summer.
The Update provides producers and industry with a concise analysis of the Australian dairy sector.
To view the full Australian Dairy Update, visit www.ruralbank.com.au/dairy.