Deloitte report reveals Australian dairy’s multi-billion dollar impact

A new report has quantified Australian dairy’s money-making and job-generating capacity for the first time — answering a billion dollar question.

New analysis of Australia’s dairy sector has highlighted the role processors play in the regional economy. Picture: Zoe Phillips

Australia’s dairy processors generate $15.7 billion in revenue, new analysis of the industry has revealed, with more than 70,000 full-time equivalent jobs nationwide.

Released today, the Deloitte Access Economics report showed the nation’s milk factories contributed $12.4 billion to the nation’s Gross Domestic Product in the 2019-20 financial year.

The report commissioned by the Australian Dairy Products Federation (ADPF) has for the first time provided an analysis of the industry’s contribution to the economy and employment.

ADPF president Grant Crothers said the Economic and Broader Contribution of the Australian Dairy Processing Industry report highlighted how Australia’s ag sector held its own against international competitors.

“With no barriers to import competition, the Australian dairy processing industry relies on being globally competitive,” Mr Crothers said.

“It will surprise many that most of dairy processing’s contribution is indirect, accounting for $9.3 billion in value-added contributions out of the $12.4 billion total.

“The remaining $3.1 billion is direct value-added within dairy processing itself.

“This means that for every dollar of value-added in dairy processing, the industry supports three dollars of value-added elsewhere in the economy.”

Mr Crothers said the report also confirmed the sustainability and environmental steps made by the Australian dairy sector in recent years.

“Energy use and emissions intensity have reduced by 24.5 and 23.5 per cent respectively in the last three years,” he said.

In the 2019-20 surveyed period, the dairy processing industry contributed a total of 70,158 full-time equivalent (FTE) jobs to the Australian workforce.

Of these, 29 per cent were direct employees within dairy processing (20,394 FTE).

ADPF executive director Janine Waller said an average of $383 million was invested in capital expenditure by dairy processors annually between the 2017/18 and 2019/20 financial years.

“Capital investment signals growth and drives innovation across the whole supply chain,” Ms Waller said.

“This report shows that as a share of total food manufacturing capital investment, dairy processing accounted for an average of 15 per cent, although in 2019-20 it reached 18.3 per cent.”