Dairy in South West Victoria

Western Victoria is an important dairying region.

  • Western Victoria is one of the largest milk producing regions in the national industry, processing milk sourced from outside the region, using its extensive manufacturing infrastructure.
  • Farmgate prices are driven by export returns. Prices have been affected by the volatility in international dairy commodity prices and sustained competition for milk.

Cows grazing in South West Victoria

The Regional Dairy Industry Statistics:

• We produce about 2.1 billion litres of milk a year from about 1500 farms and 440,000 cows (4 cows for every person in the region)
• Every day we produce enough milk to fill a line of 1 litre milk cartons side by side from Melbourne to the SA border (400kms)
• In 2008 the value of the dairy industry to the region was about $4.6 billion (($1Bn at the farm gate, $1Bn more ($2Bn) at the factory gate and $2.6Bn from the service provider sector)
• Dairy delivers a third of the economic activity in the Great South Coast region
• One hectare of dairy delivers $4400 of output/annum, beef $1600 and blue gums $520
• If you wanted to add $1Bn to the regional economy you could treble tourism or increase dairy by 25%
• 15% of the Victorian workforce is associated with the food industry
• At the 2006 census 5991 people directly worked in dairying in this part of Victoria
• For every retail job in the region there’s an equivalent job on-farm
• The agricultural output of Western Victoria (Colac Otway, Corangamite, Moyne and Glenelg) is bigger than Tasmania
• Dairy is the biggest export out of the Port of Melbourne
• 9% of Victoria's milk is in the liquid market
• Australian women are knowingly missing out on calcium for fear of racking up extra kilojoules. A recent survey revealed that one in five women believe that calcium-rich foods are often high in kilojoules. The survey also uncovered that 42% of Australians believe they get enough calcium, when 90% of the population is not getting its daily calcium needs.

Latest Statistics for Western Victoria (DA’s 2011 National Dairy Farmer Survey)

• An average farm (183 hectares produces about 1.4 million litres of milk from 300 cows every year (up from 286 in 2010)
• Over the past year, on farm capital investment has been made by 64% of dairy farmers in the region – a slightly larger proportion than the 2010 survey (58%). Investment areas have been varied, but mainly include machinery (23% of all respondents mentioning), fencing (21%) and tracks and laneways (21%).
• During the coming 12 months, 52% of respondents expect to make capital purchases for the farm, mainly on tracks and laneways (25%).
• In western Victoria, 96% of dairy cows are fed grain, grain mixes or concentrates at an average rate of 1.51 tonnes per cow per year. (up from 1.35 t in 2010)
• Average per cow production remained steady over the past 12 months, at 6,036 litres.
• Just under half (42%) of the region’s dairy farmers anticipate having higher herd production by 2013- 14 than the past year, compared with 2% expecting lower production levels. A further 3% believe they will no longer be in the industry by this time.
• Over the past year, 19% of herds did not graze pasture for an average period of 2 to 3 months.
• Calving patterns in the region consisted of:
a. Split and/or batch calving (29%)
b. Seasonal calving (63%)
c. All year round (8%)
• 3% of all heifers on hand in the region were sold this year, 2% for export and 1% domestically
• Throughout the region, 16% of dairy cows were sold or culled in the past year. Choppers accounted for 15%, milkers for 1%
• Compared to 12 months ago, a slightly higher proportion of western Victoria dairy farmers are confident in the future of the national industry (74% compared to 70%)
• For farmers in the region, milk price is expected to be the main challenge for their enterprise in future, nominated by 53% which is up from 44% in 2010
• While 29% of respondents expect to milk more cows over the next year, a further 29% believe their herd size will decrease. The average milking herd size is predicted to be around 0.5% higher than this year
• Hay and silage was purchased by 57% of farmers last year. Among those purchasing, 65% bought from a farmer without an agent involved
• Currently, 37% of dairy farms are run by the owner and a partner or by an owner operator only. Farms employing paid staff comprise 54% of all farms

Information above source:  Dairy Australia

The Western Victoria dairy region extends west from Melbourne towards the South Australian border with a large share of farms concentrated around the coastal areas near Warrnambool. Rainfall variability is low in this coastal area, creating a consistent environment for pastures and fodder crops.

The Western Victoria region’s share of Australia’s milk production has grown from 18 per cent in 1999-2000 to 24 per cent in 2011-12. The number of dairy farms operating in the region fell from approximately 2090 to 1520 during that time, a decline of around 27 per cent.

The average dairy herd size in the region was 442 head in 2011-12, higher than the national average of 374. These herd sizes include all dairy cattle, not just milked cows, as all cattle are relevant for productivity. The average farm size in the region was 244 hectares, compared with 254 hectares nationally. This indicates above average pasture conditions, resulting in greater stocking rates, and a higher intensity of production than for many other regions.

Information above source: ABARES and Dairy Australia's Productivity Project