Victorian milk production down 2.1 per cent in August

The latest milk production figures released by Dairy Australia show national milk production up slightly on last year.

August production was up 0.8 per cent, while production for the first two months of the season was up 0.5pc.

But the overall result belied the picture in different states.

Milk production in NSW grew 11.1pc in August, fueled by massive growth in inland/central NSW and on the north coast.

Western Australia (up 6.8pc), Tasmania (up 6.5pc) and South Australia (up 4.0pc) are also powering along.

Even Australia's smallest milk-producing state that has long been in decline, Queensland, has recorded a 4.9pc increase for the first two months of the season, though it was down slightly (-0.9pc) in August.

But Victorian milk production continues to fall.

It was down 2.1pc in August and 2.3pc for the first two months of the season.

The biggest loser is western Victoria, where production fell 4.6pc in August and 4.7pc in July.

Northern Victoria recovered slightly in August to be down 0.9pc, after a 3.4pc fall in July.

Gippsland is the only bright spot in Victoria, with production up 2.1pc in July and steady for August.

Dairy Australia industry analyst Eliza Redfern said for the most part the figures reflected changed weather conditions.

Last year nationally July and August milk production was affected by widespread wet conditions and flooding.

The rebound this year reflected a return to more normal conditions.

For example, NSW production was down 12.9pc in July and August last year compared with the previous year.

"There were a lot of areas through through NSW, and a bit through Queensland, that were significantly impacted by flooding events and not just one but but multiple flooding events," Ms Redfern said.

"So we're seeing that production coming through this season."

Ms Redfern said most of the decline this year was in western Victoria.

This reflected the wet conditions in that region in the middle of winter, which had limited grass growth.

Farmers had also been more cautious at pushing stocking rates in light of the forecast El Nino.

Ms Redfern said DA expected to see some stabilisation of milk production for 2023-24.

It was expected to see some growth over spring, particularly if conditions remained relatively favourable.

The big decline in beef prices was likely to lead to reduced dairy cow culling.

There were also signs of increased investment activity from farmers, particularly in areas such as northern Victoria and South Australia.

"Some farmers are looking to to invest on farm in terms of sheds and those kinds of areas," Ms Redfern said.

But medium-term constraints, including continued farm exits and labour shortages, were still a challenge and would weigh on milk flows.

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