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

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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

 

Historically, Australian milk production has exceeded the volume required for domestic consumption, thus creating a marketable surplus destined for export markets. The share of total production exported 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 growing domestic market due to population growth, resulting in less milk available for export.


 

Although Australia accounts for less than 2% of the world’s estimated milk production, it is 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.

 
  

Greater China (including China, Hong Kong and Macau) is now Australia’s largest market, accounting for 27% 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 2017/18 the total value of Australian exports was
more than A$3.4 billion.

This concentration of exports in Asia reflects both Australia’s 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) or the impact of increased export volumes from competitor countries. 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 a number of decades.

Australia’s top five export markets by value in 2017/18 were Greater China, Japan, Indonesia, Malaysia and Singapore. The top five by volume differed only slightly by order: Greater China, Japan, Singapore, Malaysia and Indonesia. The fastest growing export market by volume for Australia in the last five years has been Greater China.

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