Dairy Australia outlook paints grim picture

By Alana Christensen

Dairy Australia’s February Situation and Outlook report shows production costs continue to pressure dairy farmers with dry conditions, high feed prices and expensive water.

"Northern Victoria has seen a particularly large drop in volumes in year-on-year terms, due to the confluence of dry conditions, high purchased feed prices, and expensive irrigation water," the report states.

"The latter continues to dominate sentiment. Against a strong second half of 2017/18, substantial year-on-year declines look set to continue, not least due to ongoing exits in the short term, indicating further downside risk."

Dairy Australia’s Senior Industry Analyst, John Droppert, said the ongoing growth in markets like China and Japan provides some comfort for the Australian dairy industry in an environment that is proving challenging for many farmers.

The full February Situation and Outlook report is available at www.dairyaustralia.com.au

See next week's Country News for more.