THE number of Victorian dairy farms is projected to drop by almost 20pc to 4331 during the next four years despite farm-gate milk prices paid to farmers being at record highs.
Some farmers are retiring, some are tired of battling drought and others are selling to beef farmers or to capitalise on higher land values, industry insiders say.
According to figures presented at the United Dairyfarmers of Victoria annual conference at Melbourne University yesterday, farm numbers will plummet from 5318 in 2007-08 to 4331 in 2011-12, a drop of 18.6pc. This comes after numbers fell by 1483, or 21pc, between 2002-03 and 2007-08.
Despite the expected decline in farms, milk production in the State is forecast to climb gradually to 6 billion litres by 2011-12. Industry insiders say output will rise as some farmers sell to others and farms become bigger and more productive.
Chris Phillips, general manager, trade and strategy, at Dairy Australia, said surveys revealed that most farmers expected to expand operations over the next three years, while 5-10pc expected to leave the industry.
"There is no doubt the historical trend is for fewer farms operating … But what we have seen is that those farms that are staying in business are growing in size," he said.
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