More WA milk needed

16 Apr, 2008 10:50 AM
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AN extra 85 million litres of milk will be needed in the next two years if WA dairy farmers hope to continue supplying domestic and export markets.

Speaking at the recent Dairy Invest forum, dairy consultant Glenys Hough said milk production had been declining in WA since 2000, dropping 89 million litres since 2002-03.

At the same time, domestic consumption and export demand was increasing with the demand especially high for value added products.

“Finally we have national parity with the price of milk after seeing significant rises,” Ms Hough said.

“However, 85 million additional litres of milk will be required within the next two years and even a greater amount will be needed in the longer term.”

Existing farmers and new investors will be needed to reach the target.

“85 million litres, at around 6000 litres per cow per annum, equates to around 14,167 additional cows,” Ms Hough said.

“This is an investment of around $113,156 million, which is not in our current supply base, so we are seeking outside investors.”

However there was an opportunity for existing farmers to increase production.

“It is all about timing,” Mr Hough said.

“High milk prices may not be around forever, but as they are, farmers can afford to borrow money and take advantage of this opportunity.

“But if they don’t do it now they could miss the boat.”

Dairy Australia chairman Max Roberts said supplying 85 million litres was “a hell of an ask”.

“It will take money, investment, secure markets and margins,” Mr Roberts said.

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