Milk pro­duc­tion tipped to fall

Shepparton News - Country News - - OPINION -

High feed and water prices and tough sea­sonal con­di­tions have taken their toll, with this sea­son’s milk pro­duc­tion ex­pected to fall by eight bil­lion litres.

Dairy Aus­tralia’s Dairy Sit­u­a­tion and Outlook re­port for Oc­to­ber points to­wards a five to seven per cent milk pro­duc­tion short­fall on last year’s pro­duc­tion lev­els.

Feed prices in­creased sig­nif­i­cantly in the Goul­burn and Mur­ray val­leys, with the price for shred­ded cereal hay tripling to $402/tonne, while stock­feed wheat saw a price hike of 71 per cent to $425/tonne on av­er­age.

High water prices did noth­ing to ease the pres­sure, with many dairy farm­ers un­able to in­vest in grow­ing feed on-farm.

The Septem­ber av­er­age for traded water in north­ern Vic­to­ria was reg­is­tered at $321/Ml by the Vic­to­rian Water Regis­ter and Mur­ray Ir­ri­ga­tion, a jump of 202 per cent on the pre­vi­ous year and a 84 per cent hike on the five-year av­er­age.

This was de­spite water use in vol­ume drop­ping 13 per cent on the pre­vi­ous year, al­though it re­mained eight per cent higher than the past five years.

Zone 7 (Barmah to Nyah) had the largest month-on-month price in­crease, jump­ing $110/Ml from July to Au­gust, while both Zone 6 (Hume to Barmah) and Zone 1A (Greater Goul­burn) also had sub­stan­tial in­creases of $83/Ml and $70/Ml re­spec­tively.

Dairy Aus­tralia se­nior in­dus­try an­a­lyst John Drop­pert said there was some pos­i­tive news, with do­mes­tic sales mar­kets strong, see­ing an in­crease of 0.9 per cent in Aus­tralian milk, cheese and yo­ghurt sales.

He said while farm­ers’ key pri­or­ity was to nav­i­gate their way through the im­me­di­ate chal­lenges, on-farm de­ci­sions made in the com­ing months would be fun­da­men­tal to the in­dus­try’s abil­ity to seize the op­por­tu­ni­ties when sea­sonal con­di­tions im­prove.

‘‘While farm­ers con­tinue to feel the im­pact of the feed short­age and in­creas­ing cost of pro­duc­tion, do­mes­tic and global mar­ket trends pro­vide a timely re­minder that dairy has an im­por­tant role in Aus­tralian di­ets and im­prov­ing the nu­tri­tion of mil­lions of peo­ple around the world,’’ Mr Drop­pert said.

‘‘Dairy de­mand has re­mained ro­bust, with dairy ex­ports from the six ma­jor ex­porters in­creas­ing 3.7 per cent over the past 12 months.

‘‘Greater China and Ja­pan helped drive this growth, while de­mand from the Mid­dle East and North Africa re­gion in­creased for the first time in over three years.’’ Last sea­son snap­shot . . . The 2017-18 sea­son pre­sented some chal­lenges for farm­ers in north­ern Vic­to­ria, yet it was a bet­ter sea­son than the pre­vi­ous year with good pas­ture growth, higher milk pro­duc­tion and an im­proved milk price. Rain­fall tracked close to (92 per cent) the longterm av­er­age for the sea­son, boosted by a large rain­fall event in De­cem­ber.

Not all doom and gloom . . . Dairy Aus­tralia’s se­nior in­dus­try an­a­lyst John Drop­pert said it wasn’t all bad news, with Aus­tralia’s do­mes­tic sales mar­kets in a strong po­si­tion.

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