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Covering the Goulburn and Murray valleys

Northern milk boost coming

Northern Victorian farmers are forecast to produce more milk in 2013-14 than in the previous year and farmgate milk prices are expected to increase, according to an Australian Bureau of Agricultural and Resource Economics and Sciences report released last week.

LAURA GRIFFIN December 17, 2013 4:03am

Northern Victorian farms are expected to generate more milk this year.


Northern Victorian farmers are forecast to produce more milk in 2013-14 than in the previous year and farmgate milk prices are expected to increase, according to an Australian Bureau of Agricultural and Resource Economics and Sciences report released last week.

But continued decline in western Victoria and northern NSW because of dry seasonal conditions is likely to offset the change, dragging Australian milk production to decline slightly to 9.1billion litres in 2013-14.

Murray Dairy chair Malcolm Holm said it was great that others were recognising this region as a place for growth.

‘‘Not only in this official report, but in the company’s confidence to invest in the region such as with the new UHT milk plant in Shepparton,’’ Mr Holm said.

He is optimistic about coming years for the whole Murray Dairy region, including northern Victoria, north-east Victoria and the southern Riverina.

‘‘The region is well positioned to rebound from drought. No doubt the past decade has been tough for our region, but now there is an opportunity for farmers to get their balance sheets back in order and develop some resilience in their businesses,’’ he said.

‘‘The Murray Dairy region has plenty of capacity.’’

Mr Holm said Murray Dairy was supporting the 1500 dairy farms in its region by ensuring they had the tools to expand their business as they saw fit, for example by helping them attract and retain good staff.

‘‘It’s about those individual farmers being in control and giving them the tools.’’

The bureau’s December Agricultural Commodities report also forecasts the Australian average farmgate price for milk to increase by about 22 per cent in 2013-14 to 47.7¢/litre, reflecting the effect of higher world dairy product prices and an assumed depreciation of the Australian dollar.

Mr Holm welcomed the report’s forecast, but was not surprised by it, saying forecast prices were in line with farmgate milk prices dairy farmers had been experiencing in recent months.

‘‘Milk factories have been responding to the upward trend of global milk prices,’’ he said.

The report predicts Australian dairy products’ export earnings to increase 24 per cent in 2013-14, thanks to continued strong import demand from Asian markets, particularly for milk powders, and lower milk production in the main dairy exporting countries.

‘‘Increasing prices is about increasing imports, but the domestic market needs to play its part too,’’ Mr Holm said.

ABARES executive director Karen Schneider said if farm exports reached the forecast $38billion, this would be a record high in nominal terms and around eight per cent above the average over the five years to 2012-13 in real terms.

Other farm commodities forecast to increase in 2013-14 include beef and veal (up 12 per cent) and wine (four per cent).

Export earnings from crops are forecast to decline by 7.4 per cent to about $21.3 billion in 2013-14, in large part because of increased global production.

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