Presentations & Papers

Evolution of dairy production systems in the world’s leading exporters

Evolución de los sistemas de producción lecheros en los principales exportadores del mundo

Presentation to INALE (National Institute of Milk) Forum – Uruguay, June 2019

By David Beca

PRESENTATION OUTLINE

This presentation covers the following areas:

SHORT SUMMARY

An initial review of growth in annual milk supply shows that the New Zealand, South African and United States dairy industries have all been consistently growing over the last 17 years, while the Australian, Argentinian and Uruguayan industries have all stopped growing at some point.

When milk price is reviewed over this period, it is clear that this has not been a relevant factor for the absence of growth in Australia, Argentina & Uruguay. Much larger increases in cost of production in these countries is identified as the problem, and the presentation reviews a broad selection of ratios to identify in more detail what has been behind this.

Changes to farm production systems are the major factor behind the increases in cost of production, with Australia, Argentina & Uruguay significantly reducing the percentage of pasture in the cows’ diet, which has been associated with higher levels of concentrate being fed per cow and a move to larger US-type cows. This has left these 3 countries with low levels of dairy farm profitability, to the extent that on average they no longer have comparative advantage to other land uses within their countries and nor are they internationally competitive.

The presentation then looks at what might need to change for these trends to be reversed, including what might be learnt from South Africa, which was in a similar position in the 1990’s but then made some significant changes to recover their profitability.

To view a selection of slides from the presentation in English please click here.

Para ver una selección de diapositivas de la presentación en español, haga clic aquí.

To view the interview David Beca completed while in Uruguay where he outlines many of the key principles from his presentation please click here (preguntas y subtexto en español).

In the interview David answers 4 questions:

  1. How would you summarise the milk production and economic trends over the last 17 years for Argentina, Uruguay, New Zealand, Australia, South Africa & United States?
  2. What do dairy farmers need to do to get a good return on capital (or to improve their profitability)?
  3. What are the prospects or forecast for the 6 countries analysed?
  4. What are the opportunities that I see for improvements in the production systems in Uruguay? (this question is equally relevant to Argentina & Australia)

Go back


© Copyright 2021. All Rights Reserved. A site by Black Sheep Creative