Biggest dairy farm sales of the last year revealed

Solid milk prices and significant interest from North American corporate buyers underpinned dairy land prices in the last year. See how values have changed.

Tallis MilesProperty and digital reporter

@tallis_miles

2 min read

June 10, 2024 - 5:00AM

The Weekly Times

New Zealand-based dairy company Fonterra is selling its Australian operations

Relatively strong milk prices and significant interest from North American corporate dairy buyers underpinned a year of substantial price growth for dairy farmland, including several notable transactions.

Dairy farmland values in both Tasmania and Victoria increased well beyond $20,000 a hectare last year, while values in the smaller market of NSW remained steady, Rabobank’s Australian Agricultural Land Price Outlook 2024 report author and RaboResearch analyst Vitor Pistoia said.

“Dairy land prices (nationally) showed strong price growth, increasing 22 per cent in 2023,” Mr Pistoia said.

“Sales for dairying areas in NSW, already few in number, dropped 4 per cent year-on-year to a median price of $23,400 a hectare.”

In Victoria, the value of dairy farmland increased by 16 per cent year on year, rising to a median value of $21,750 a hectare, while in Tasmania there was a 13 per cent increase to $29,000.

“Despite the drop in purchase intentions, dairy and mixed irrigator operators remained confident, especially in the north of the state (Tasmania). Scalable and well-located properties continued to attract sound interest throughout 2023,” Mr Pistoia said.

“The dairy market (in Victoria) particularly saw demand for smaller farms for expansion. Of all dairying ground sales, 33 per cent were deals under 100 hectares.”

The sale of the Boorook dairy hub at Cooriemungle was one of the largest dairy farm transactions in the last year.

Some of the most significant dairy farm sales last year included the recent deal for the Boorook dairy hub at Cooriemungle, selling half to a buyer, while the 429ha north side was purchased by an investor with nearby holdings for alternate use.

On the apple isle, Prime Dairy, the dairy farming arm of Melbourne-based fund manager Prime Value Asset Management, agreed to a reported $15 million deal with the Chinese-backed operator Van Dairy Group, acquiring 700ha of its famed Woolnorth aggregation.

Since this transaction was completed, Van Dairy has listed the remaining 9452ha of the historic Woolnorth for sale, as it exits the Australian dairy industry.

Meanwhile, at Cowra in Central West NSW, the premier 370ha Silvermere Holsteins changed hands in an $18 million deal, purchased by the Chittick family.

JLL Agribusiness director Chris Lawlor said demand for dairy farmland had “flattened” in the last 12 months, while the outlook for demand was dependant on where major processors settled on their milk prices for the season ahead.

“Previously we might have three or four buyers competing for a dairy property, but this is more like two or three at the moment,” Mr Lawlor said.

“The processors are probably in a wait-and-see phase at the moment, so with the season ahead, farmers would be more likely to wait for milk prices to increase before selling their property, unless they have a higher age profile.”