Quarterly Australian Milk Production Update – Feb ’18
Executive Summary
Australian milk production figures provided by Dairy Australia were recently updated with values spanning through the first half of the ’17-’18 production season. Highlights from the updated report include:
Low farmgate milk prices and poor weather conditions have taken a toll on Australian dairy producers throughout much of the past two years, contributing to the declines in production volumes. Some regions of Australia are expected to continue to face poor weather conditions going forward however weather conditions have generally been decent throughout the first half of the ’17-’18 production season.
Recently experienced adverse conditions contributed to the Australian dairy cow herd contracting by 1.8% throughout 2017, to 1.66 million head, finishing lower for the second consecutive year. USDA expects the Australian dairy cow herd will rebound by 0.6% throughout 2018 as rising farmgate milk prices are expected to support herd rebuilding.
Australia is the fourth largest global dairy exporter, trailing only New Zealand, the EU-28 and the U.S. Of the top five dairy exporting regions accounting for over 90% of total global dairy exports, Australia accounts for 3.1% of total combined milk production and 6.9% of combined butter, cheese, nonfat dry milk (NFDM) and whole milk powder (WMP) export volumes.
The bulk of Australian dairy exports are in the form of cheese and NFDM. Australia was the fourth largest exporter of both cheese and NFDM throughout 2016, accounting for 8.7% of global cheese export volumes and 8.2% of global NFDM export volumes. From a global perspective, cheese and NFDM markets may be most affected by a rebound in Australian milk production.
- Australian milk production increased on a YOY basis for the third consecutive month during Dec ’17, finishing up 2.4%. Australian milk production finished the ’16-’17 production season down 6.7%, reaching a 20 year low, but has rebounded by 2.9% throughout the first half of the ’17-’18 production season.
- Low farmgate milk prices and poor weather conditions contributed to the Australian dairy cow herd finishing lower for the second consecutive year during 2017, declining by 1.8%. USDA projects the Australian dairy cow herd will rebound by 0.6% throughout 2018 as rising farmgate milk prices are expected to support herd rebuilding.
- Australia is the fourth largest global dairy exporter, accounting for 6.9% of combined butter, cheese, nonfat dry milk and whole milk powder exports throughout 2016. The bulk of Australian dairy exports are in the form of cheese and nonfat dry milk.
Low farmgate milk prices and poor weather conditions have taken a toll on Australian dairy producers throughout much of the past two years, contributing to the declines in production volumes. Some regions of Australia are expected to continue to face poor weather conditions going forward however weather conditions have generally been decent throughout the first half of the ’17-’18 production season.
Recently experienced adverse conditions contributed to the Australian dairy cow herd contracting by 1.8% throughout 2017, to 1.66 million head, finishing lower for the second consecutive year. USDA expects the Australian dairy cow herd will rebound by 0.6% throughout 2018 as rising farmgate milk prices are expected to support herd rebuilding.
Australia is the fourth largest global dairy exporter, trailing only New Zealand, the EU-28 and the U.S. Of the top five dairy exporting regions accounting for over 90% of total global dairy exports, Australia accounts for 3.1% of total combined milk production and 6.9% of combined butter, cheese, nonfat dry milk (NFDM) and whole milk powder (WMP) export volumes.
The bulk of Australian dairy exports are in the form of cheese and NFDM. Australia was the fourth largest exporter of both cheese and NFDM throughout 2016, accounting for 8.7% of global cheese export volumes and 8.2% of global NFDM export volumes. From a global perspective, cheese and NFDM markets may be most affected by a rebound in Australian milk production.