Dairy Australia finds confidence among farmers despite coronavirus uncertainty
Farmer confidence is up in the dairy industry but sentiment is at its lowest point in over a decade.
CONFIDENCE within the dairy sector was tracking into positive territory earlier this year — prior to the release of lacklustre farmgate prices this month.
According to the National Dairy Farmer Survey conducted in February, 44 per cent of farmers were positive about the industry’s future, while 67 per cent were positive about their own businesses, a 22 per cent increase on the previous year.
The survey, included in Dairy Australia’s Dairy Situation and Outlook report released today, found farmer confidence was up 10 per cent on last year, when sentiment in the industry was at its lowest point in more than 15 years.
The February mood lift was attributed by report authors as the result of early rainfall and lowering feed prices.
A supplementary survey conducted in early May found 20 per cent of farm businesses had been affected by coronavirus-related restrictions in some way, such as sourcing farm materials.
Dairy Australia senior analyst Sofia Omstedt said Australia’s milk production recovery had been driven in large part by favourable seasonal conditions in Victoria and Tasmania.
Dry conditions and subsequent high input costs in other parts of the nation have quelled the recovery outside southeastern Australia.
“Input costs had become more manageable at the time of the survey. Favourable seasonal conditions have also been a factor in increased confidence,” Ms Omstedt said.
Meanwhile, the outlook report revealed how initial coronavirus restrictions in March radically altered the purchasing choices of Australian shoppers.
Nielsen data detailed in the Dairy Australia report volume sales of long-life milk surged 76 per cent in the four weeks to March 22 while volume sales of fresh milk grew by nearly five per cent.
In the 12 weeks to April 19, fresh milk volume sales increased by 3.8 per cent while butter volume sales grew strongly, up nearly 32 per cent.
“Because most states and territories around Australia restricted cafes and restaurants to take-away services only, sales in the foodservice sector declined significantly,” Ms Omstedt said.
“But with the decline in cafe and restaurant sales, more Australians had to cook from home and that’s why butter and even fresh milk sales increased over the first four weeks of the coronavirus restrictions.”
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