Dairy re-ranking: Tasmanian set to surpass NSW milk production

Tasmania has bucked national trends and is on track to overtake NSW as the second best state in the country for dairy.

Tasmanian dairy farms are bucking the national trend, tapping into some of the state’s 18 irrigation schemes and lifting the production this season by 2.3 per cent.

Tasmania is set to overtake NSW in the dairy production rankings, as the island state bucks the national trend and lifts production, with irrigation developments adding to growth.

As of the end of April, NSW seasonal production was down 9.6 per cent to 829 million litres, while Tasmania was the only state to grow production, up 2.3 per cent to 809 million litres.

If the trend continues Tasmanian farmers are on track to become Australia’s second-ranked dairy state, after Victoria.

Dairy Australia industry analyst John Droppert said it was inevitable that Tasmanian production would surpass NSW.

“We’ve seen really healthy growth in Tasmania and that investment in irrigation systems has been important,” Mr Droppert said. “We’ve seen investment from processors, government, family and corporate-equity partnerships.”

Tasmanian Merseylea dairy farmer Paul Lambert said the state’s production “will keep on going up, with more conversions” of beef properties and plantation blocks to dairy.

Dairy farmers are also tapping into government-owned Tasmanian Irrigation’s 18 irrigation schemes, which are 75 per cent funded by the state and federal governments.

Tasmanian Irrigation CEO Andrew Kneebone (far right) is overseeing the rollout of 10 more irrigation schemes, pictured here with farmer Justin Nichols and Tasmanian Farmers and Graziers association vice-chair Andrew Bevin.

Tasmanian Irrigation chief executive Andrew Kneebone said the investment was all about boosting the state’s economic growth across agricultural industries, with another 10 schemes due to roll out over coming years, worth about $1 billion.

“We run them (the schemes) to break even, to keep the cost of water down,” Mr Kneebone said. “The pay back is greater economic development.

“For every dollar an irrigator spends on buying water, they spend another $1.50 to $2 on their farm, and that cycles through the economy.”

Tasmania irrigators can purchase water entitlements for about $2200 a megalitre, compared to about $4100/ML on Victoria’s Goulburn system and $8000/ML for high reliability water on the Murray River.

Australian Dairy Farmers Tasmanian national councillor Geoff Cox said while Tasmania had relatively reliable rainfall, it could also experience dry spells as happened during the 2021-22 season, which is why irrigation was crucial to growth.

“It has turned a lot of dry areas into irrigation areas, with (water allocation) reliability at about 95 per cent,” Mr Cox said.

For dairy, irrigation has been particularly valuable in Tasmania’s drier midlands.

But it’s not all about water.

Thirlstane dairy farmer Simon Badcock, whose property just east of Devonport is fully irrigated, said growth in dairying was not just about water, but also maximising pasture use.

“It makes no sense to feed grain if you can feed grass,” he said. “(Only) about a ninth of (his herd’s) feed is grain.”