September 8, 2004

Milk Consumption Up In Australia

Milk consumption has increased for the first time in 10 years, according to the latest figures from Dairy Australia.

That is good news for the Australian dairy industry, which saw some recovery in production levels during 2003-04, to just over 10 billion litres.

Dairy Australia's Joanne Bills says it will take some time to fully recover from the drought.

"I think, for the current season, we are still in a recovery phase; it does take a few years for livestock industries to rebuild those herds, so we're expecting that this year we'll see production flat, or up perhaps, compared to last year; and then we'll really see it back to the 3 to 4 per cent growth after that."

Meanwhile there are big challenges ahead for the global dairy industry, with production in the European Union set to change.

Dairy production in the EU is moving from the traditional areas of France and Britain to eastern European countries like Ukraine.

Ian Lean from Global Dairy says land and labour is cheaper there, and Australia will have to stay on top of the changing market.

"We need to be alert to the fact that we have to maintain our extremely competitive stance. Europe's goal in the long term is to move its agricultural production from the west into those eastern states where they have the potential to be very much the same type of efficient producers we are."

"We have to capitalise on them by astute management to be prepared for the second European onslaught."