Dairy Australia - Dairy information for Australian Dairy Farmers and the industry

Primary content

Australia ranks fourth in terms of world dairy trade, with our share of milk exported contracting following a decline in overall milk production.

International market overview

 
Australia’s milk production exceeds the volume required for domestic consumption and this has traditionally created a marketable surplus destined for export markets. The share of total production destined for export has ranged from around 30%-60% over the period shown below. Over recent years Australia has exported close to 30%-40% of its milk. The share of milk exported has contracted following a decline in overall milk production, and a larger domestic market due to population growth. This has resulted in less milk available for export.

Australia accounts for less than 2% of the world’s estimated milk production but remain a significant exporter of dairy products. Australia currently ranks fourth in terms of world dairy trade – with a 6% share, behind New Zealand, the European Union as a bloc and the United States.

Exporters share of world trade

  
Since a few years back, Greater China (including China, Hong Kong and Macau) is Australia’s largest market, accounting for 30% of exports by volume. Japan remains a vital trade partner for Australian exporters, as a mature, high-value market with long-established business relationships. Australian exports to Asia account for close to 85% of total exports and in 2018–19 the total value of Australian exports was more than A$3.2 billion.
 
Australia’s concentration of exports in Asia reflects the geographic proximity to these markets and the extent to which Australia has been excluded from other major markets by direct restrictions (as in the case of the European Union). Increased competition in key importing markets has also played a role in creating this concentration. Asian markets have considerable potential for consumption growth as incomes rise and diets become more ‘westernised’. Australian dairy companies also have proven track records in supplying these markets over several decades.
 
Australia’s top five export markets by value in 2018–19 were Greater China, Japan, Indonesia, Singapore and Malaysia. The top five by volume differed only slightly by order: Greater China, Japan, Singapore, Malaysia and Indonesia. One of the fastest growing export markets by volume for Australia in the last five years has been Greater China. 

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