Confusion as prices differ for dairy by-products

Prices for most feed sources have fallen for the second month in a row but dairy farmers say they are not seeing much reduction, and some prices have actually gotten dearer.

The Dairy Australia report said soya bean meal out of Melbourne has also fallen $60 to $830/tonne while cotton seed is back $20 to $450/tonne. Picture: Zoe Phillips

Reported price falls of as much as $70 per tonne for by-products like cottonseed and soybean for supplementary feeding are not flowing through to dairy farmers.

Dairy Australia’s by-products report for April shows rates for most feed sources have fallen for the second month in a row, a feat it described as rare.

“In a rare instance and for the second month in a row, prices on all by-products have fallen or remained steady,” the report said.

But dairy farmers say they are not seeing much reduction at all, and some prices have actually got dearer.

The biggest reported price fall has been for wheat mill run (a by-product of flour manufacturing) with supplies from the Riverina falling by $70 in the past month to $280/tonne.

However, the DA report said soya bean meal out of Melbourne has also fallen $60 to $830/tonne while cotton seed is back $20 to $450/tonne.

And corn has “dropped significantly” the report said as harvest gets underway and is selling at about $300/tonne, again out of the Riverina, which has seen some farmers swap from cereal grains to corn. The maize prices are currently 6 per cent below last year and 7 per cent below May 2022.

DA analysis and insights advisor Izzie Dando said there was a plentiful supply of by-products at the moment, as well as an increased availability of fodder across Victoria and southern NSW.

“There have been favourable conditions over summer and with an increased supply and softening demand, prices have gone down,” Ms Dando said.

She said corn was currently selling for anywhere up to $330/tonne, compared to $350-$370 a year ago. Cotton seed, at $450/tonne, was also down from the $490-$530 it was making the same time last year.

South West Victorian dairy farmer Bernie Free. Picture: Karla Northcott

But the figures have been disputed by United Dairyfarmers of Victoria president Bernie Free from Warrnambool, who said the prices he was paying were going up.

“We are hearing of more and more demand for by-products and increases in prices,” Mr Free said.

“I would question if these figures from DA are accurate.”

Mr Free said while some areas had received rain, others were looking at supplementing their herds for six to eight weeks.

“It’s not such a rosy outlook for dairy farmers who will be spending money on feed of some description,” he said.

According to the industry’s national dairy farmer survey, about 19 per cent of the nation’s herds are consistently fed by-products, with the trend steadily increasing in Victoria and Tasmania. They were most commonly used in herds with more than 500 cows.