Rabobank’s annual dairy seasonal outlook has boldly predicted good things for the industry while talking up profits.

In the outlook, titled In Pursuit of History, the agribusiness banking body said dairy was now “staring down history” as expectations for a highly profitable 2019-20 season continue to ramp up.

These expectations are largely contained to the southern export region.

The report predicts Victorian farmer margins will exceed industry targets in 2019-20 and again in 2020-21.

There is even talk of the 2021-22 season being “on track” for similarly strong results.

Rabobank senior dairy analyst Michael Harvey said if these expectations were realised, it would be the first time since benchmarking began 15 years ago that three consecutive seasons have exceeded industry targets.

“The elevated outlook for the milk price is key to profitability,” Mr Harvey said, confirming the fate of the industry remains in the processors’ hands.

Mr Harvey said the return to profitability was “remarkable” after an extended period of low margins.

Rabobank is expecting a 2021-22 milk price of $6.65/kg MS in the southern export region.

“Price signals ahead of the 2021-22 season remain favourable, with the upside and downside risks to the global outlook more balanced then they were this time last year,” Mr Harvey said.

“That said, while the pandemic-related uncertainty has subsided, it has certainly not disappeared.”

Mr Harvey said global freight and logistical challenges, which were complicating the outlook and market dynamics, were set to recede by mid-2021.