All levels of Australia’s dairy industry have to work to address the potential hurdles to sustainable and profitable growth. That was the key theme running through presentations at the United Dairyfarmers of Victoria’s (UDV) 40th annual conference and general meeting in Melbourne on Friday.
Dairy Australia managing director Ian Halliday said milk production in Australia had declined since peaking at 11.2 billion litres in 2001-2, whereas New Zealand had steamed ahead to 22 billion from a comparable rate early in the new millennium.
He said despite modest growth in the last couple of seasons, there was no clear pathway to profitable milk production expansion.
Mr Halliday said the important first step was to understand the industry’s current position and hurdles to growth, before proposing pathways to overcome them.
He said in the past 18 months to two years, the project ‘Pathways to profitable growth’ was started and was being rolled out nationally.
It has involved creating a framework to assess potential growth in each dairy region, set achievable growth targets and the actions needed to achieve it.
Depending on the region, this could include any combination of actions to overcome issues with land availability, feedbase and climate, water, cows, finance, infrastructure and factories, and labour and skills. The industry may also be held back by shortcomings in research and development, social licence and cultural change within the industry.
Mr Halliday said the ongoing project to identify and address impediments to growth was vital to reassure our export customers that we can reliably fulfil their growing dairy needs.
“We don’t care what the number is (for the growth target, because) if we’ve got profitable dairy farms, our volume will grow,” Mr Halliday told the about 90 dairy farmers at the conference.
“We need to understand what are the constraints to profitable dairy volume growth in different regions because we’ve had $2-3 billion in investment in stainless steel but how will we get volume to grow?”
He said Australia’s mainland dairy regions could learn from DairyTas, which is the past few years had galvanised stakeholders and government through the project ‘Into Dairy’ to raise $1.6 billion to drive profitable milk volume growth.
“Their goal was to increase (production by) 30 to 40 per cent in four to five years and they will get close, although this year’s dry conditions will interrupt,” Mr Halliday said.
He said discussing milk production growth and its inhibitors would undercover solutions and prioritise public and private investment.
