Victorian dairy industry in crisis as farmers predict milk shortage unless prices improve

And consumers may be forced to drink long-life milk as farmers walk off the land because they have struggled to make a profit.

New figures show that 252 dairy farms have closed in Victoria in just 12 months and milk production dropped by 8 per cent across the state in the past financial year.

Farmer Power, an industry lobby group, believes the public will soon be drinking long-life milk unless the government steps in to help.

“Within two years we will have a shortage of milk in our own country,” Farmer Power president Chris Gleeson said.

There are 1457 fewer registered dairy farms across the state than a decade ago, figures from Dairy Food Safety Victoria show.

Alex McKenzie, who has been a dairy farmer for 70 years, said he had watched many “good farmers” leave the industry, pushed by the low price of milk, which he called “a disgrace”.

“I wouldn’t be surprised if the day comes when we are importing milk. It’s a terrible thought but unless they do something to stabilise the industry, it’s going to continue to contract,” the 86-year-old said.

Mr McKenzie started dairy farming at age 16 and said at the start of his career, he share-farmed 66 cows and made enough profit in three years to buy a new car.

“We’re now milking 266 cows and scratching to pay a bill,” the Cooriemungle farmer said.

Dairy Australia senior analyst John Droppert said dairy farms usually declined by 3-4 per cent each year — sometimes with smaller farms selling to bigger ones — but almost double that had shut down in the past 12 months.

An outlook report released by Dairy Australia on Friday shows a three-year low on profitability for farmers, with only 45 per cent saying they will make a profit in the past financial year.

But Mr Droppert said Dairy Australia forecasted milk production to increase by 1-2 per cent in the next financial year due to a better milk price and cheaper grain and hay.

“It won’t fully recover that 8 per cent drop,” he said. “There’s less milk to go around and that’s a challenge for the industry.”

Farmer Power has launched a fundraiser for an education campaign to inform the public about the issues.
Source: Herald Sun

Link: http://www.heraldsun.com.au/news/victoria/victorian-dairy-industry-in-crisis-as-farmers-predict-milk-shortage-unless-prices-improve/news-story/3685fdaa4ab824522137b1dba91b9b87

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