Australian milk production is tipped to rise marginally to total 9.1 billion litres this year according to Dairy Australia - up 100 million on 2009.
With annual milk product export values climbing to about $2.19b by October, Dairy Australia's strategy manager, Joanne Bills, said global markets were rewarding the cautious production lift with remarkably stability during the past eight months.
Overseas demand was yet to show any real impact from the dollar's rise to US98 cents and above, with the last quarter of 2009-10 and the first months of this financial year delivering a 30 per cent rise in the value of our dairy exports.
By October the average per tonne value of Australia's dairy exports at $3600, was up more than 16pc on the same period last year.
However, back on the farm recent farm production had been constrained, initially by a jump in grain prices, then a slow, cool and muddy start to summer.
"But a lot of irrigation dams are now full, there's plenty of grass and there is now likely to be quite a lot of feed quality grain available to encourage extra milk production from dairy herds," Ms Bills said.
