Situation & Outlook Report

Dairy Australia is the Australian dairy industry’s go-to source for the latest international and domestic market trends, statistics and facts, providing expert analysis and unbiased insights.

The latest Situation and Outlook report discusses how milk production conditions have continued to improve over spring. Plentiful pasture growth, wet weather and warm days have resulted in a significant surge in feed production which has seen hay and grain prices ease.

Whilst the national milk pool is set to increase for the first time in three years, milk production growth has slowed down in recent months as a smaller national herd, a drop in farm numbers and labour challenges create tangible limitations this season.

The report also describes how the easing of COVID-19 restrictions has unleashed months of pent-up consumer demand and seen foodservice sales rebound since spring. This is having a positive impact on dairy demand from non-grocery channels while at the same time, retail stores continue to report elevated sales.

  • Situation and Outlook Report December 2020

    (08 December 2020)
    PDF, 1.65 MB

Listen to Dairy Australia’s John Droppert chats with Gary Embleton from Ausfine Foods about insights from the December Situation and Outlook report, including trade opportunities in Indonesia.


Dairy Australia Podcast 39 - Situation and Outlook December 2020

Ausfine Foods’ Garry Embleton talks to Dairy Australia's John Droppert about the trade opportunities and challenges for dairy in the world's fourth most populous country.
Industry data
Situation and Outlook
Female dairy famer at milking facility

Milk production

Milk production conditions have continued to improve over spring, however, the Australian milk pool has plateaued as a smaller national dairy herd and issues around labour availability have added production limitations this season. Dairy Australia expects milk production to track towards the lower end of the current 1% to 3% growth range for 2020/21.

Australian market

Retail demand for dairy products remains elevated, with sales of milk and yellow spreads growing 4.6% and 8.7% respectively in the twelve months to November.  The easing of COVID-19 restrictions has seen foodservice demand rebound as people enjoy new freedoms, however consumers have continued to focus on buying larger packsizes, usually priced at a discount.

Disclaimer: Source: Nielsen Homescan based on a continuous panel of 10,000 households; excludes non-private dwellings & businesses, non-permanently occupied households & out-of-home/impulse purchasing. DAIRY AUSTRALIA calculation based in part on data reported by Nielsen through its Homescan Service for the dairy category for the 52-week period ending 01/11/2020, for the total Australian market, according to the Nielsen standard product hierarchy. Copyright (c) 2020, The Nielsen Company

Global markets

For the first time since 2014, milk production in the four largest dairy exporting regions has been increasing for more than four months in a row. At the same time, strong Chinese demand for dairy has continued to keep the market relatively well balanced and been the main driver of a 3.8% increase in global dairy trade in the 12 months to August. However, as new lockdowns are implemented in the northern hemisphere and stimulus packages are phased out, demand is expected to come under pressure.

Previous Reports

Access previous Situation and Outlook reports from our Resource Hub.

Cookies help Dairy Australia improve your website experience. By using our website, you agree to our use of cookies.