mmg.com.au

Farmers and advocacy groups cannot control milk prices, but they can influence rising production costs, UDV Policy Council representative Adam Jenkins told last week’s UDV conference.

The Nuffield scholarship recipient said global milk prices, global milk supply and demand and other countries’ government policies were out of the control of farmers and advocacy groups.

Mr Jenkins said farmers should keep the equation ‘Income – Cost = Profit’ at the forefront of their minds.

Farms’ profitability can be increased by lobbying to reduce cost and regulation pressures, including those related to the impacts of the energy reforms, diesel rebates, labour reforms and the carbon tax.

The south-west Victorian farmer said costs could also be decreased by investing in renewable energies such as wind and solar power.

He said effective advocacy could also increase incomes by exporting Australian dairy products to opening markets such as the Middle East and Asia.

‘‘We also need to improve market access by using our advocacy through the right channels including the Australian Dairy Farmers and Dairy Australia as our research and development arm,’’ Mr Jenkins said.

‘‘We need to work together and showcase our amazing industry. We have a clean, green environment — a natural advantage of our system — and we need to market that.

‘‘We have great farming practices and we have a great economy.’’

XCheque farm consultant Neil Lane agreed Victoria’s pasture-based dairy industry was one of its competitive advantages.

‘‘Operating costs fall dramatically as the proportion of grazed pasture increases,’’ Mr Lane said.

‘‘Equivalent profitability can be achieved on a wide range of calving patterns and feeding systems.’’

Warrnambool Cheese and Butter Factory’s general manager of milk supply Anthony Cook said the Australian dairy industry had to push the Federal Government to establish free-trade agreements with emerging milk markets, including China and South Korea.

Murray Goulburn’s general manager of shareholder relations Robert Poole said ‘‘very big’’ global milk production in recent years, particularly out of New Zealand, had depressed global prices, but they were likely to improve as New Zealand’s milk production dropped due to drought-like conditions.