Regional Round-up is a monthly newsletter providing an overview into the environmental and business conditions affecting farmers and rural businesses in the Goulburn Valley and North East Victoria.
Dairy
Levels of uncertainty continue in the dairy industry with the Saputo purchase of Murray Goulburn yet to be finalised. Although updates on the sale progress are slow to emerge, it is still expected to be completed by mid-2018.
With a hotter than normal January, milk production is expected to be lower than last December. There is some optimism with suggestions of a $6 MS finishing price alongside the payout of Murray Goulburn shares.
The Murray Goulburn Rochester factory ceased production on 24 January and closed on 31 January. It is likely some local business closures may follow in reaction to reduced trade in the town.
Cropping/Sheep
Lamb prices softened slightly due to changes in the Australian dollar but have since recovered and remain strong. Mutton supply may reduce as producers hold stock in response to high wool prices for Merinos. With plenty of hay around and water supply strong, there is little incentive to sell wethers.
Wool prices remain high, despite currency fluctuations.
The strong AUD is resulting in steady grain prices despite the recent rally in US markets. Locally, wheat is $255/tonne. The domestic market is still fairly quiet. Reportedly growers are reluctant to sell at the moment and happy to sit out the market waiting for prices to firm.
Hay trading is mostly stagnant in response to spring weather which has supported growing pastures and plenty of carryover. Although some northern and far western areas are still dry, overall the general feeling in the region is positive, with expectations for more than enough hay this season, complemented by a good silage year. Hay storage should result in a strong source of supply to other regions.
Beef
After a record year for carcass weights in 2017, 2018 will likely see this drop back in line with long-term trends. A lower number of cattle on feed is expected after the highs seen in 2017.
A decline towards the 850,000–950,000 head mark is expected, driven by increasing grain prices combined with a growing gap between feeder and 100-day finished over-the-hook prices – underpinned by farmers restocking paying premiums in the young cattle market and increased US competition in key grain-fed export markets.
Horticulture
Fruit fly continues to be on the region's radar with local governments flagging both farmer and the wider community to the importance of managing fruit fly. City of Greater Shepparton has appointed several field officers across the Goulburn Murray Valley as part of a coordinated approach to protecting the region against Queensland fruit fly.
Irrigation
High reliability water share allocations are at 100% for all Victorian systems and the three-month rainfall outlook from the Bureau of Meteorology is very positive for south east Australia.
The Bureau of Meteorology now has a water storage dashboard on its website, including a Murray-Darling basin page.
