Dairy in Gippsland

Gippsland dairy farmer.Dairying is spread across Gippsland, with the Baw Baw, Wellington and South Gippsland shires being home to more than 75% of the region's dairy farms (a total of 1430 dairy farms).

Dairying is important to the region’s wealth. It is easily the biggest agricultural contributor to the local economy. Even in a year that saw pastures struggle under too wet conditions, Gippsland still managed to produce 20.6% of the nation's milk supply. While the weather was unkind last year, changes to the long term climate may not impact on Gippsland with the same intensity as other regions. The irrigated areas of the MID and the high rainfall locations in other parts of the region should remain high-value dairy producing land.

Dairy Data 2012/13

In 2012/13, in challenging conditions,  the Gippsland dairy industry experienced the following:

  • Milk prices falling 11% to $4.75/kg milk solids and grain prices rising to $356/t dry matter. All of this happened while the dry conditions caused a large depletion of fodder reserves and conspired against good pasture production.
  • Return on assets was hit hardest in Gippsland compared to north and west Victoria. In Gippsland, return on assets fell from 4.4% in 2011/12 to -0.2% a year later. In historical terms, the returns in Gippsland were the lowest since the 2006/7 season.
  • Net farm income in 2012/13 was at -$59,000, down from $113,000 the previous year. During the same period, return on equity dropped to -6.2% from 5.1%. Earnings before interest and tax (EBIT) sat at just $38,000, down from $211,000 the previous year. (Data taken from the Dairy farm monitor report, August 2013).

Numbers:

Each year, Dairy Australia surveys over 1,000 dairy farms including 190 in Gippsland. For more information, visit the Dairy Australia website and search for National dairy farmer survey report.

Chart 1: Location of dairy farms

Chart 2: Herd Sizes in Gippsland

 

Herd Size % Herds 2012 % Herds 2013 
Small (150 or less) 22 26
Medium (151-300) 48 45
Large (301-500) 21 19
X-Large (501-700) 5 6
XX-Large (>700) 4 4

 

Further facts were collected by Dairy Australia during its annual ‘Situation and Outlook survey’ and are available from www.dairyaustralia.com.au