Dairy farm sales that defied a year of declining values

Tighter farmgate milk prices and green drought conditions affected dairy farmland prices this year, but some big deals defined the market.

Dairy farmland prices have faced a year of declining value as tighter farmgate milk prices, higher interest rates and green drought conditions tempered demand across both Victoria and Tasmania.

Victorian values dropped 5 per cent in the past year down to a median price per hectare of $20,580, the Rabobank 2025 Australian Farmland Price Outlook revealed.

Meanwhile, across the Bass Strait in Tasmania, dairy values dropped 9 per cent to a median price per hectare of $26,850.

However, within the dairy industry, JLL director of agribusiness Chris Lawlor said he expected varied values depending on irrigation support associated with different properties.

“It’s exciting for irrigated dairies, the big risk-sensitive corporate buyers have no interest in dryland farming so their demand will keep these farms on a marginally higher trajectory,” Mr Lawlor said.

“But don’t expect the 2018-22 sort of crazy jump.

“Unfortunately I expect dryland dairies will endure a price correction and flatline related to climate risk. Real land values of dryland dairies may have dropped 10-20 per cent. If you can find a buyer you may get a good valuation where there have been few sales.

“North Victoria is a unique case on its own, with exceptional ‘top of the Darling’ rainfall, set to keep them going, but the inevitable growing shortage of water due to government buybacks is quite frankly scary.”

Despite the seasonal and farmgate challenges, the largest dairy farm sale of the past 12 months came in recent months following the transaction of the 603ha Jindivick Farm in West Gippsland.

A private West Gippsland family listed two dairy farms for sale after acquiring parts of the properties in the 1940s, growing the operation to an 800-cow enterprise.

The value of the transaction remains undisclosed due to confidentiality arrangements. The purchaser of the properties also remains undisclosed.

The 603ha Jindivick Farm in West Gippsland changed hands last month after more than 80 years with one family.

When Jindivick Farm was listed for sale the properties were expected to be worth more than $33,000 a hectare, or greater than $20m in total.

Meanwhile, in northern Victoria the 763ha Kanyapella dairy, located 12km east of Echuca, was purchased by PSP Investments, via their corporate dairy arm Aurora Dairies – the largest dairy farming enterprise in Australia.

It is understood the transaction, completed walk-in walk-out with a lactating herd of 800 Holstein-Friesians cows, was worth $16.15 million.

The Kanyapella property was listed for sale in November 2023 by a pair of New Zealand investors, including vendor Patrick McMonagle, following about 20 years of ownership.

Harper and Oonagh Kilpatrick bought the 717ha Denium Dairy, inside the historic Van Dairy portfolio.

The biggest dairy in Tasmania’s mighty Woolnorth Van Dairy portfolio also changed hands and is now in Australian ownership for the first time in its storied history.

Victorian husband and wife dairy farmers, Harper and Oonagh Kilpatrick, purchased the 717ha Denium Dairy, from Chinese businessman Xianfeng Lu’s Van Dairy Limited.

Regarded as the largest dairy farm inside the historic aggregation, the Kilpatrick family acquired the property on January 30, marking the first part of the Van Dairy’s 9500ha Woolnorth portfolio to sell since it was listed for sale last year.

The value of the deal remains undisclosed, however, when the portfolio hit the market recent property transactions in the North West Tasmanian region suggest a median price of almost $26,000 per hectare.