Dairying looks to better times

AMPLE RAIN: Michael Kilkenny, who manages Jelbarts’ dairy farm at Leongatha South, said current weather has suited the business.

DAIRY farmers can look forward to an improving industry after a challenging time for the sector.

Dairy Australia’s latest Situation and Outlook report indicates ongoing dry conditions until now had impacted national milk production, farm profitability and farmer confidence.

Despite continued higher costs for grain, hay and water, Dairy Australia is tipping a better outlook for the new season.

The national dairy organisation reported the optimism was being driven by growth in worldwide demand for dairy products, particularly in such markets as China and south-east Asia, and per capita dairy consumption in Australia being amongst the highest in the world.

Dairy Australia’s John Droppert said dairy farmers were finally reaching the end of a challenging time.

“Positive domestic market trends, stronger global markets and a weaker Australian dollar have supported higher farmgate pricing this season and look set to deliver further increases over the next 12 months,” he said.

“Surging input costs have however, outweighed improved farmgate pricing and milk production will likely remain under pressure.

“Higher pricing will provide opportunities if enough rain falls at the right time and pushes grain, hay and irrigation water prices down.”

That sentiment is largely shared by South Gippsland farmers.

Michael Kilkenny manages Jelbarts’ dairy operation at Leongatha South and he is optimistic about the forthcoming season.

“We have plenty of moisture in the ground so the grass is going pretty good here,” he said.

“You are never happy with the price but it is better than it has been.”

However Mr Kilkenny is concerned about the possibility of one of the many dairy companies now operating in Australia withdrawing from the country due to lack of milk to meet their demands.

“A lot of them are owned by companies from overseas and you do not have the likes of Murray Goulburn anymore,” Mr Kilkenny said.

Mardan farmer Barrie Allan is confident in the direction being taken by Saputo Dairy Australia and is hoping the company can collect milk lost when suppliers of Murray Goulburn, which Saputo bought, left.

But for now, he is just hoping for South Gippsland’s regular winter rain to fall.

“The dams that are usually full are not full and if we do not get rain, we are going to be in diabolical trouble,” he said.

“If we don’t get good rain, then we won’t get more milk. It’s all tied up in one thing and that’s the weather.

“A dry winter is lovely to work in but you pay for it in the long term because you do not get the pasture.”

A farmer who did not wish to be named said while the milk prices being offered this season were positive, he remained cautious about the following season.

“The whole milk industry has to come up by $1 a kilogram of milk solids,” he said.

“They were paying $6.05 a kg/MS last year and Saputo is now at $6.80. It does not make sense to me. That’s a big rise.

“Maybe they did not pay us enough last year. I know they want milk but why are they all of a sudden able to pay us $6.80?

“What will they pay next year? Are they going to drop it back?”






Short URL: http://thestar.com.au/?p=29554

Posted by on Jul 23 2019. Filed under Rural News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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