Comparing dairy prices across the Tasman
Potentially lower milk prices don’t bode well, but dairy farmers across the Tasman have shown what can be done in trying conditions.
With opening milk prices starting to roll in, the industry is looking to New Zealand to compare how the financial situation might unfold domestically.
Data from the Australian Dairy Products Federation (ADPF) shows that imports from New Zealand have increased by 22 per cent, and imports from the US are up 46 per cent.
Meanwhile, Bulla has announced an opening price for 2023-24 farmgate of $8.80 to $9.60 a kilogram of milk solids.
ADPF executive chairman John Williams said farm gate prices being paid in Australia, compared to New Zealand, were currently 20 per cent higher.
This was considered to put Australia at a competitive disadvantage in export markets.
It was also being reflected on supermarket shelves domestically with New Zealand cheese and butter cheaper than Australian products.
However, Mr Williams said that despite the inflation-related cost of living pressures, the demand for nutritious dairy products continues to be encouraging.
From June 1, 2023, Australia’s dairy farmers will have a month to assess farmgate milk price offers and contract terms from processors as the annual 2023-24 milk season opens.
Under the Australian Competition and Consumer Commission (ACCC) Dairy Code of Conduct implemented in January 2020, raw milk buyers must complete and make publicly available Milk Supply Agreements (MSAs) by June 1, including milk price.
NSW Farmers dairy committee member Phil Ryan of Bega in NSW said there were concerns that the milk price might drop slightly.
“The bottom line is if the milk price falls at the farm gate, then milk supply will fall too,” he said.
Ideally, he said dairy prices needed to stay close to where they are.
Like many other primary producers, dairy farmers were facing rising costs. And there were also challenges in sourcing employees.
“We are not the only ones looking for workers; most farmers are aware of the fact there needs to be more labour,” he said.
Mr Ryan said electricity and fertiliser input costs kept the industry under pressure.
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