Farmgate milk in Australia to fall 9% in the 2020-2021 season

The farmgate milk price in Australia is expected to reach an average of 47.9 cents per litre in 2020–21. This represents a 9% reduction from high levels in 2019–20 and is above the 5-year average of 46.9 cents per litre. Demand for dairy products is expected to weaken in the short term, reflecting the effects of COVID-19 control measures on the economies of Australia's major dairy export markets. Growth in global dairy production will also continue to place downward pressure on global prices, which will flow through to the Australian farmgate milk price. Increased Australian milk production in 2020–21 might ease some of the competition for milk supply between domestic processors.