Catch up on the key messages from our presenters
Last week’s Advance Your Autumn events proved popular with dairy farmers across the region keen to hear what the climate, water and markets had in store.
Starting with the big picture, Dairy Australia Analysts, John Droppert and Sofia Omstedt, provided an update on global milk trade and production; commodity prices and consumer trends; input prices and fodder prices. You can review this information in the latest Situation and Outlook report (February 2019). GMW and MIL representatives, Andrew Shields and Lauren Noonan, provided an explanation of the current state of water storages and likely scenarios for 2019. For Northern Victoria, this is detailed in the 2019/20 Seasonal Determination Outlook which was released last Friday. Local agronomists and consultants also featured on the line-up, providing their recommendations for autumn crop and pasture management, with particular focus on how to get the most from limited water.
The resounding message was to plan. Whilst this is easier said than done in the face of uncertainty, having a plan (or two, or three) can at least help you put some numbers around herd size, production or input requirements; draw up some budgets; and identify your trigger points. Dairy Australia and Murray Dairy have these tools available to assist your planning:
- Feed and Water Budget Tool – to put together a rough annual feed and water budget
- Advanced Feed Budgeting Tool – to calculate monthly feed demand and deficits
Share your plan with your bank manager, agronomist, nutritionist and other service providers who are better able to support you if they can clearly understand what you’re trying to achieve. Prepare early so that cash, seed and fertiliser is available when you need it (i.e. in time for the autumn break or after a good rain) and to take some of the stress off!
John and Sofia’s presentation highlighted that the signs for milk price are steady, with demand growing for dairy across the globe, but competition still impacting Australian exports. Whilst competition has eased slightly, Australian producers are struggling to meet demand due to seasonal conditions and higher input costs. Nationally, production has fallen 4.8% compared to last year (July to Dec 2018), and is projected to reach 7-9% by the end of June.
The drop in the Australian dollar is working in our favour. Domestic demand continues to be strong, particularly for premium products including flavoured milks, yoghurts and speciality cheeses.
For more information, check out the latest Situation and Outlook report.
Prices for hay and grain remain high across Australia. Demand is expected to decline this year, although still expected to exceed supply.
Whilst the West Australian grain yield has been good this season, it has not been enough to make up for losses across the east coast. National wheat production is likely to be 20% lower than average for 2018-19. Wheat prices are tracking around 60% higher than average for this time of year.
Future prices will depend heavily on the autumn break.
Seasonal determinations against high-reliability water shares (HRWS) at the start of the 2019/20 water year will depend heavily on flows received into the major storages during this coming autumn and early winter. At this time of year, it’s hard to forecast the coming season, although the BOM has given a 50% chance of El Niño developing during the southern hemisphere autumn or winter, twice the normal likelihood (this has been downgraded from January). An El Nino typically results in below average autumn and winter rainfall for southern and eastern Australia.
There are lower reserves in storages compared to this time last year and the year prior. Seasonal determinations are likely to be low unless water storage levels increase.
According to the Northern Victorian Resource Manager’s most recent Water Outlook, “a repeat of the flows into the major storages observed in 2018/19 would result in the Goulburn system reaching about 65 per cent HRWS in February 2020 and the Murray system would be about 60 per cent.”
Another Water Outlook will be released on the 15th May, 2019.
Consider the best return on your water
It’s no surprise that water was the main talking point of each of our Advance your Autumn events, with discussion around different feed options, irrigation management and dryland cropping.
People operating their business as usual are preparing to start watering in early March, with ryegrass and clover mixes likely to be watered 3-5 times over March and April. This year, agronomists are stressing that soil tests, paddock preparation (where required), weed management and effective fertiliser application will pay dividends. These are small costs compared to water, but have potentially just as much return. Speak to your agronomist for the best advice on your situation.
For people with only enough water for one start-up irrigation, agronomists suggested going with cereals, which will provide considerably more feed in June-July than a late starting ryegrass. Ryegrasses sown late, once soil temperatures have dropped, could take 8 to 9 weeks to get to grazing stage, as opposed to the usual 5 to 6.
If you’re thinking of waiting for rain, cereals can also be sown dry. Rather than using an irrigation on a late-sown cereal, you’re better off letting May-June rains bring it up and putting water on the crop once soil temperatures have increased in early spring. This will give you more tDM per megalitre of water.
Spread your risk
Whilst cereals can be a quick feed early in the season with little water, they’ll need to be locked up for hay and silage in early to mid-August. Pastures may take longer to start but give you an option to graze all through spring. Depending what fits into your system, you may grow a bit of both.
If you’re hoping for a big spring, carryover will be an option this year with GMW having announced that, under any scenario – dry to wet – carryover will be deliverable in the Murray, Goulburn, Campaspe and Loddon systems. The risk of spill, based on assumed use to the end of 2018/19, allocation carried over and climate-adjusted flow records, the risk of spill is estimated to be less than 10%.
Whilst securing water at current prices may not be too appealing, consultant Brian Crockart, suggested that you might put a bit aside now and secure more later, with the option of selling if it becomes dearer.
Farm businesses across the Murray region can access a free, confidential consultation to help scope, plan or review the coming season, with a consultant of your choice. Contact us on (03) 5833 5321 to register.
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