Growth in the dairy industry is at unprecedentedly high levels.
Export growth for Australian milk is up and expected to keep rising.
But forecasts for dairy prices at the back end of the season are taking a downward turn which will see a fall in dairy incomes.
International dairy consultant, Greg Bethard, says during the good times, farmers need to start planning for the bad.
“We have really bad times, we have really good times.
“This happens to be the moment when things are really good” he said.
Mr Bethard says farmers in the U.S are producing dairy products at a record surplus which is finding a strong market in exports.
“We’ve never been this high.
“It’s climbed the last four or five years every year, we were 30 percent higher in 2013 than in 2012 and we’re climbing, climbing, climbing.
“It’s our growth area for sure.”
Mr Bethard is in Australia teaching dairy farmers how to maximise profitability from their dairies before, he says, the prices collapse.
“They will drop but I think we will still be profitable for some time.
“Where they drop to a point where we’re not making money anymore, it’s hard to tell.
“It will get there, is it 6 months, a year, two years? It’s hard to tell” he said.
While farmers aren’t able to predict when the next fall in prices will be, he says they are able to control their sustainability in the future.
“The history of our industry shows very clearly that when we have times of high price and high profits, sometime in the future they will be followed by a decline”.
“We just don’t know when that will be.”
Source: ABC