In its latest Global Dairy Quarterly report for Q2, Rabobank notes farmgate milk prices remain at historical highs, despite 2023/24 forecast prices being lower than the prior season. The report noted some positivity for Australian dairy as milk production rose across NSW, Tasmania and WA in March and forecast 2022/23 milk output to finish 5% down compared to the prior season.

However, the growth in output has not been enough to halt the decline in seasonal milk production, which in April fell 5.9% behind the prior season comparative. The sharp fall in milk production has translated to lower export volumes, which are down 14% season to date across all commodities. According to Rabobank, the most significant falls have been in ingredients, particularly SMP and butter with liquid milk volumes under pressure as high farmgate prices reduce competitiveness in key export markets.