There are some positive signs coming from China regarding dairy, according to Stefan Vogel, general manager of Rabobank Research for Australasia.
Milk production in China is down, like man other parts of the world, due to rising cost of production, he points out.
Vogel says the Chinese Government’s decision to lift domestic dairy production led to a substantial increase over the past five years.
But he says there are signs that this is slowing down, due in part to the higher cost of production which is hitting dairy farmers worldwide.
“We have seen a drop in milk production in other places such as the US, South America and the EU,” he told the NZ Institute of Primary Industry Management (NZIPIM).
“That could be good news and help the trade down the road,” he says.
“But dairy imports into China in 2025 may still be challenged and won’t be back to where we were two or three years ago, so that means challenging prices for a while longer,” he says.
Despite the ups and downs of the international dairy market, Vogel believes the future of the NZ dairy industry will remain an important part of the country’s farming system.
He says the moves by government to seek new trade agreements and diversification into new markets will be a part of the new order.
He says NZ is in the top category of efficient dairy producers, but not the number one.
He says NZ is tracking well and moving in the right direction to meet sustainability goals and deliver what the consumers want.
He says farmers in NZ, like those in Europe, have been given a bit of breathing space to reach the targets.
“When I went school, if somebody told me I had a little bit more time, I went to the playground rather than study. The message I have for NZ is this is not the time to go to the playground,” he says.
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