The challenges facing the Goulburn Valley dairy industry were similar to those in California, a visiting academic said last week at a Murray Dairy presentation in Tatura.
American economist Dan Sumner told farmers and stakeholders that international markets, water supply and environmental regulation were having an impact on dairy production in California, the biggest dairy state in the United States.
Murray Dairy chief executive officer Jenny Wilson introduced Professor Sumner with an overview of the northern Victorian and southern Riverina dairy industry, where there are 1372 dairy farms producing about 2000million litres of milk annually, which is about 22 per cent of the national pool.
Milk production had slipped down in the past financial year, although the per cow milk yield had increased.
Prof Sumner said dairy products were the third-largest agricultural export from California, but cow numbers continued to fall and milk production per cow had only marginally increased since 2007.
California was facing increased competition from other dairy states which were improving their efficiency.
Prof Sumner said California was also facing high labour costs, increased regulatory control and relatively low milk prices.
Farms were now being taxed for their methane outputs and the state was placing more control over groundwater pumping which had previously been largely unregulated.
The state was also monitoring manure disposal and nitrate management.
Prof Sumner said it was unlikely any more dams would be built because the issue was politically unpopular.
The visit was organised by the Committee for Greater Shepparton and facilitated by Prof Sumner’s university colleague, Dr Julian Alston, who grew up on a farm in Katunga.
Prof Sumner is an agricultural policy economist and runs the University of California’s Agricultural Issues Centre. He served as an Assistant Secretary for Economics under George Bush in the early 1990s.