Latest news with #DairyAustralia
SBS Australia
2 days ago
- Business
- SBS Australia
Australian dairy is in 'a world of pain' — and you might feel it at the checkout
Dairy Australia says less than two-thirds of businesses expect to make an operating profit, and more than half anticipate that profits will be lower than the previous five-year average. Source: Getty / Dowell Australian dairy farmers have faced increasingly difficult conditions in recent years, and it could mean mounting prices for consumers. Consumer groups have warned prices for milk products are expected to rise in the near future due to product shortages. But dairy farmers say it might not be enough to save the struggling industry. Australian dairy is a $13 billion industry spanning farming, manufacturing and exports, with a farmgate value of $4 billion alone, according to the industry's peak body Dairy Australia. Many dairy farms are in Australia south and south-east. After a hot, dry summer, NSW has faced heavy rain and floods, while Victoria, Tasmania and South Australia have been experiencing drought. In May, brothers Kevin and Doug Schlenert had their dairy production facilities and 70 per cent of their herd destroyed in floods on the NSW mid-north coast. The brothers said they didn't know whether they would be able to recover. "I've got no dairy now to keep going. I don't know which way to turn at the current moment," Kevin said, speaking with SBS News in the aftermath of the floods. "I don't know if I can bounce back from this. I really don't know." According to Dairy Australia's 2025 mid-year Situation and Outlook report, wet weather in the north and dry conditions in the south, in addition to tightened farm margins, have weighed on milk production across several dairying regions The report found a decline in farmer confidence in the future, with only half of respondents in the National Dairy Farmer Survey expressing positive views about the industry's future, compared to two-thirds the previous year. Dairy Australia said less than two-thirds of businesses are expecting to make an operating profit, and more than half are anticipating profits will be lower than the previous five-year average. Ben Bennett, a dairy farmer in south-west Victoria and president of Australian Dairy Farmers, which represents dairy farmers across Australia, said he is extremely concerned about the future of the dairy industry. He said the combination of rising operating costs and weather challenges has put many farmers in an impossible situation. "We're in, quite frankly, a world of pain," he said. "And it's going to get a lot worse too as we enter winter." Bennett said Australian dairy production has decreased by 25 per cent over the past two decades, while dairy imports from overseas have increased. He believes Australian dairy production will continue to suffer without government assistance and environmental policies designed to support farmers. "It would be better for a lot of policies to adhere and listen to local people in that area to maximise environmental opportunity and betterment as opposed to ... people who are somewhat removed from that kind of on-the-ground position," he said. Dairy companies recently announced their farmgate milk prices for the new financial year — that is, the price paid to farmers per kilogram of milk solids in the raw milk, which is later processed into products. Prices range between $8.60 to $9.20 a kilo, up slightly on last year, but a number of industry groups said farmers were hoping for more. You may have noticed dairy products are becoming more expensive. Michael Harvey, senior analyst at Rabobank, which focuses on agribusiness, said there was inflation "across the dairy aisle" in 2023 and 2024. "What consumers would realise is they're paying a lot more for their dairy products from the supermarket than they were two years ago ... milk, butter, cheese, yoghurt, anything you can track," he said. "We are at the tail end of a significant price spike for dairy products at a retail level." At the peak of the cycle, Harvey said prices increased by 25 per cent for milk and cheese. Dairy Australia's report said despite an increase in milk prices, high operating costs will continue to limit profitability for farmers, especially if weather conditions don't improve. Harvey said while consumers might be hit with some price increases in the coming months, he does not expect them to be as steep as those recorded in recent years. "That was very unique — it was record-high commodity pricing, it was record-high farm debt pricing, and that's what underpinned the need for companies to pass through high costs to consumers. "It can be a little bit complex, but ultimately it's about the global price of milk that will ultimately set the direction of pricing for dairy products and farm gate milk price." In the aftermath of the NSW floods, Eric Danzi, CEO of EastAusmilk, an industry body representing dairy farmers on the Australian eastern seaboard, warned the destruction could have an impact on supermarket shelves. "There's certainly going to be a real shortage of milk and products — how that plays through to consumers I don't know," he told Sydney radio station 2GB recently. "Between the massive floods in NSW now, previous [ex-tropical] Cyclone Alfred, and the drought in Victoria and South Australia, you're going to have a massive reduction in milk production across Australia." Harvey said while the current conditions are devastating for farmers, he does not expect them to lead to significant price increases in the short term. "It's not what's going to drive the farmgate price higher or commodity prices higher, it's more global fundamentals that matter," he said. Available in other languages Share this with family and friends
ABC News
3 days ago
- Business
- ABC News
WA dairy farmers dismayed at 'stagnant' milk prices amid rising costs
West Australian dairy farmers say they are disappointed by the ongoing stagnation of farmgate milk prices as repeated dry seasons and rising costs take a toll. Processors recently published their 2025-26 supply agreements as part of transparency measures in the Dairy Industry Code of Conduct. For the third successive year, WA processors have been offered no substantive price increase. The disappointment was shared by interstate producers, where processors have offered slight increases. Dairy farmers in WA's South West have called on local milk processors to review their offers, with one major processor, Bega, already conceding to a two-cent-per-litre rise. Brunswick dairy farmer Michael Partridge said the initial price offered by Bega was not enough. "Prices haven't moved for three and a half years; last year was a really hard year for farmers in Western Australia," he said. "The Dairy Farm Performance Program, which Dairy Australia did, showed 50 per cent of dairy farmers made a loss, and there was an average 2 per cent return on investment, and the prices didn't move, which was extremely disappointing." Though 2-cents-per-litre extra from Bega was not enough, Mr Partridge said it was a start. "I was pleased to hear that Bega has announced a 2-cent price rise, but it's not enough to turn the industry around," he said. He called on other big processors to do the same. "We really need the other two processors, Brownes and Lactalis, to follow suit, and push it further," he said. WAFarmers Dairy Council president Ian Noakes, who also runs a dairy in the south west of the state, said the stagnation of pricing ignored the fact that production costs had risen substantially for dairies. Mr Noakes said his lobby group was seeking a 5-cent increase to support farmers to be profitable. He said WA's average farmgate price ranged between 60-70 cents per litre, and that pricing hadn't materially changed in the last three years. While East Coast dairies had access to overseas export markets, WA's dairy farmers were constrained to a comparatively small, local market. For that reason, Mr Noakes partially blamed the major supermarkets' low-priced home brand milk ranges for the subdued pricing offered by WA processors. Mr Noakes recently presented to an ACCC inquiry into Australia's major supermarkets, urging the regulator to recognise the damage of home brand milk ranges. The ABC contacted WA's major dairy processors for comment, of which Coles was the only one to respond. "We introduced a direct sourcing model for our own brand milk in 2019 to ensure we could provide fair, competitive and guaranteed farm gate prices to dairy farmers directly," a Coles spokesperson said in a statement. "Our multi-year agreements for our direct supply dairy farmers aim to support them in longer-term planning, and as part of the process of setting these agreements, we consider a range of factors including supply volumes, customer demand, farm production costs, and dairy market condition,s including commodity prices." Harvey Fresh's parent company, Lactalis, declined to comment, and Brownes and Bega were yet to respond.
West Australian
5 days ago
- Business
- West Australian
WA dairy farmers remain reluctant to expand their business despite positive conditions in the upcoming season
WA dairy farmers remain reluctant to expand their business despite favourable weather conditions and forecasted higher farmgate prices and business profits for the upcoming season. Dairy Australia's 2025 national dairy farmer survey suggested improved seasonal conditions are contributing towards greater positivity about the future of the industry yet WA farmers remain cautious in the short-term. Similarly, Tasmania and Gippsland farmers remain positive but mindful, while in South Australia and Murray confidence in the industry's future and their own businesses have dropped significantly since 2024. New South Wales farmers are most optimistic about profitability, with many planning to make on-farm capital investments over the next two years and are more likely to make major investment decisions compared to other regions. Dairy Australia analysis and insights manager Eliza Redfern said extreme weather was the largest industry concern currently with 69 per cent of farmers affected by it. 'While the worst impacts have been in western Victoria and SA, at least half of all businesses in every dairy region have experienced some effects of extreme weather conditions,' she said. Industry is also facing higher operational costs and global headwinds that continue to impact profitability and decrease producer sentiment. With most WA milk going to the domestic market, the state is least likely to be impacted by trade and economic uncertainty. However, Rabobank's 2025/26 Australian dairy market outlook — released on May 28 — has noted an uncertain global backdrop could lead to a dampening of dairy demand locally and in Australia's export markets. Senior dairy analyst Michael Harvey said recent tariff measures introduced by the US administration have unsettled many international markets. 'While this is likely to see minimal direct disruption for Australia's dairy sector – given the local industry's product mix and market exposure – from a broader perspective, several key dairy trade flows remain under scrutiny,' he said. In terms of the domestic retail market, Dairy Australia's situation and outlook report — also released on May 28 — indicates dairy continues to perform well, supported by behaviour linked to inflation and emerging consumer trends. Ms Redfern said year-on-year milk was up 0.7 per cent, dairy spreads were up 3.3 per cent, cheese was up 4.2 per cent and yoghurt was up 8.4 per cent. 'Australia is on track to maintain a national milk pool of 8.3 billion litres this season,' she said. However, Ms Redfern said lingering climate impacts, margin pressures and a lower appetite for farm business growth may result in easing milk production for the 2025/26 season. 'Dairy Australia currently forecasts a 0-2% reduction in national milk production for next season, likely dropping to around 8.24 billion litres, however, it is a rapidly developing situation,' she said. In terms of WA, Ms Redfern said milk production has also been tracking down this season, despite favourable weather conditions. 'Both the dry conditions and cull cow backlogs from the 2023/24 season have been resolved, however the latter has left the state with a significantly smaller herd,' she said. 'There have been approximately eight farm exits this season, with all reportedly maintaining the same ownership but converting to beef as a hobby as part of their retirement plans. 'While the above has weighed on WA production this season, the state will likely maintain a milk pool between 300-350 million litres and will possibly do so again in the 2025-26 season, if weather remains favourable and farm exits slow.'
West Australian
5 days ago
- Business
- West Australian
Dairy Australia announces DataGene boss Matthew Shaffer will lead the organisation into a ‘new era' as CEO
Dairy Australia has announced the appointment of DataGene boss Matthew Shaffer as its new chief executive to help lead the organisation into a 'new era'. Mr Shaffer was selected after an 'extensive' recruitment process for his vision for the organisation, knowledge and passion for the dairy industry, and strong commercial experience in agriculture. His appointment comes at a time when the dairy industry is facing climate-induced disruptions, fluctuating farmgate prices, high operating costs and global headwinds. Dairy Australia chair Paul Roderick said Mr Shaffer brings a wealth of experience and a proven ability to deliver meaningful change. 'After consulting farmers around Dairy Australia's strategic direction, we are preparing to launch a new five-year strategy,' he said. 'Matt will contribute to shaping our future direction and play a critical role in implementing a strategy that supports farmers to unlock the potential of their farm business, innovate for future success, while ensuring a sustainable dairy industry.' Mr Shaffer has extensive experience in agricultural economics and corporate leadership within the dairy industry. He was most recently chief executive of DataGene, before which he was chief executive of Holstein Australia. Mr Shaffer also spent time in an international operations role at US-based Hancock Agriculture Investment Group. He will succeed managing director David Nation — who announced his decision to step down in late 2024 after seven years in the role — on July 16. Mr Roderick said Mr Nation challenged the status quo and championed initiatives that have had a lasting impact on the dairy industry. 'His leadership in research and innovation through partnerships with DairyBio and DairyFeedbase has been exceptional,' he said. 'He also played a key role in enhancing Dairy Australia's support for the industry's sustainability agenda, building community trust, and strengthening regional connections with farmers. 'Under his guidance, Dairy Australia has become a more people-focused organisation with a clear commitment to delivering value for the industry.'
ABC News
04-05-2025
- Science
- ABC News
World-first genetic index helps Aussie farmers breed heat tolerant cows
On a hot, humid afternoon in autumn, near the New South Wales Southern Highlands, hundreds of milking cows make the long commute from Trevor Parrish's back paddock to his dairy. Despite the unpleasant conditions, most of the herd has been grazing all day and is now teeming with commercial-grade milk. That is because this fourth-generation farmer has been breeding for heat tolerance using an invention designed to better protect cattle, and maintain milk yield, amid global warming. Mr Parrish manages a 40-hectare dairy farm with 300 cattle outside Kangaroo Valley. ( ABC Illawarra: Justin Huntsdale ) While Kangaroo Valley is certainly not the hottest area in the state, the surrounding hills trap the flow of cool air, often creating sweltering conditions for Mr Parrish's Holstein heifers. "This year has been more humid but December was exceptionally dry … the year before was exceptionally wet. So each year is never the same," he said. "And in the summertime, when it's too hot, [the cows] all stand together, which makes it worse because their body heat multiplies." Kangaroo Valley, made famous by its heritage bridge, is about a 2-hour drive south-west of Sydney. ( ABC Illawarra: Brooke Chandler ) Industry peak body, Dairy Australia, estimates milk yield can drop by between 25 to 40 per cent if cattle are too hot, causing them to stop eating or not eat enough. Mr Parrish, 62, said he previously looked at other strategies aimed at keeping both milk production and his income steady. "We have a larger dairy shed so there's more shade and trying to milk the cows earlier in the morning and later in the afternoon," he said. Mr Parrish has worked as a dairy farmer on his family property for almost four decades. ( ABC Illawarra: Justin Huntsdale ) In 2017, a new tool was published for farmers using artificial insemination called the Heat Tolerance Australian Breeding Value (ABV). It used statistical analysis to tease out which animal had a greater ability to tolerate hot conditions and expressed it as a number with the base of 100. Mr Parrish was quick to sign up, becoming one of the first farmers in NSW to try it. " To me it made a lot of sense to have a look into it and try and use bulls that were [more] heat tolerant so it would help the next generation moving forward. " Tool in genomic selection Melbourne-based scientist Thuy Nguyen is the creator of the Heat Tolerance ABV. In 2013, while working at an agricultural bio-science organisation, she set out to help farmers using her expertise in genomic selection. "Farmers have already done a lot to help cows cool during hot days," Dr Nguyen said Thuy Nguyen created the Heat Tolerance ABV. ( ABC Melbourne: Richard Sydenham ) "But adding genetics on top of all that is significant because it's better for the animals and improves the bottom line for the farmers when they go through the warmer season, which we know is becoming more apparent due to climate change." The ABV requires a quick genetic sample, such as a tuft of hair, which is then posted to Dr Nguyen and her team at DataGene — an independent and industry-owned organisation. Any result above 100 tells farmers that the cow has an above average heat tolerance and is the animal they should breed from. "We will be able to tell [farmers] which animal is more tolerant or susceptible to heat stress," Dr Nguyen said. Mr Parrish's cattle can produce up to 50 litres a day in commercial-grade milk. ( ABC Illawarra: Justin Huntsdale ) Mr Parrish said the results from his herd were surprising. "One bull I've used did a big drop which was unfortunate. But I had a couple of others that went way up," he said. He now estimated around 20 per cent of his herd were genetically better at handling hot and sticky weather. " I would totally encourage other farmers to use [the ABV]. It's not getting any cooler. " ABV receives praise overseas Breeding heat tolerant cattle using the ABV has received a huge amount of homegrown industry support. Dairy Australia's national animal health and welfare lead Stephanie Bullen said the genetic index was a "world first". Stephanie Bullen is the national animal health and welfare lead at Dairy Australia. ( ABC Central Victoria: Sarah Lawrence ) "We are really, really proud … I think it's important to put the cow at the centre of this conversation; those cows are going to be uncomfortable in that hot weather," she said. "So it's about maintaining the cow's welfare as much as it is maintaining the productivity effects." Ms Bullen was a panellist at this year's HERD-25 conference, a biennial event held in Bendigo. She said the ABV was discussed on multiple occasions and had garnered international acclaim. "[There] is certainly appetite by others internationally to look at what we are doing here and how that might work for them," Ms Bullen said. Dr Nguyen said the tool had already been tested in America. "The US tested our ABV and found that it works in their conditions so it's great to see it make waves globally," she said. Watch ABC TV's Landline at 12:30pm AEST on Sunday or on . ABC Rural RoundUp newsletter Stories from farms and country towns across Australia, delivered each Friday. Your information is being handled in accordance with the Email address Subscribe
