Analysis Milk production

Higher milk production in New Zealand and Australia

April 8, 2024 - By our team of market reporters

The latest milk supply figures from New Zealand show a clear growth trend. The data published by DCANZ indicates an increase, partly driven by the extra leap day. Additionally, Australian milk supply is higher compared to the same period last year.

Milk supply in February reached 1.91 million tons in New Zealand. Compared to February last year, this marks a significant increase of 5.5%. The difference was smaller between February 2022 and 2023 when the increase was 2.3%. The inclusion of an extra day due to the leap year skews the comparison. Excluding this extra day and based on average production in February, milk supply in February was 1.85 million tons, still showing a growth of over 1.87% compared to February last year. However, this is a weaker growth rate than the previous year's increase.

Without the additional leap day factored in and based on average daily production in February, total milk production for January and February 2024 combined amounted to 4.172 million tons. This compares to 4.166 million tons during the same period a year earlier.

The increased milk production is partly attributed to weather conditions in New Zealand. February experienced very dry and unusually sunny weather but with relatively normal temperatures. Soil moisture levels remained largely the same as a month ago. It is drier than usual everywhere except in Waikato and Southland, as noted by an analyst. These conditions have led to abundant grass growth in these two regions, where a relatively large amount of milk is produced.

In 2023, milk supply totaled 21.245 million tons, slightly higher than in 2022. Initially, the U.S. Department of Agriculture (USDA) expected a decline to 21.2 million tons due to El Niño weather patterns, lower milk prices, and ongoing cost inflation for dairy farmers.

Australian milk supply starts strong in first months
Australian milk supply reached 601.8 million liters in February, as reported by Dairy Australia. Excluding the extra leap day and based on average daily production, total production amounted to 581.05 million liters, still higher than the 553.5 million liters in February 2023. For January and February 2024 combined, milk production reached 1,308.5 million liters without the leap day, compared to 1,244.9 million liters during the same period in 2023.

This indicates a stronger start to Australian milk production this year, aligning with USDA's earlier expectation of a 1% increase to 8.5 million tons of milk in 2024. Australian milk production in 2023 was 8.13 million liters.

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