In its latest quarterly report, Rabobank expects Australian milk production to grow at a slower pace in 2026-27 after reaching 8.35bn litres last season. The outlook remains broadly positive, supported by domestic conditions and demand for protein-rich products. But El Niño and below-average Spring rainfall pose risks to pasture growth, feed availability and milk supply.

Farmgate prices are largely established, with further upside dependent on stronger global commodity returns, particularly for cheese. In 2025-26, fluid milk exports rose 9% YOY and cheese shipments were stable, while exports of butter, WMP and SMP declined. Dairy imports increased across most categories, led by stronger whey demand.