Price rise helps encourage Reef Programme investment

byrnes low res

Yungaburra dairy farmer Dennis Byrnes says that last year’s price rise is helping to give some confidence to reinvest in his business.

By Brad Pfeffer

DENNIS Byrnes is among dairy farmers on the Atherton Tableland who are now catching up on delayed maintenance and on-farm investment upgrades that sat on the backburner during recent years of depressed farm gate prices.

Farming at the southern end of the dairying region at Yungaburra, Mr Byrnes said recent years of low prices had seen farmers such as himself put off much-needed maintenance. But a recent price rise from the region’s processor, Lion, has put some confidence back into the local industry to the point where farmers can again think about upgrades and investments.

In mid-2014 Lion announced a five cent per litre (cpl) rise in its base price, while also abolishing tier two milk pricing.

For Mr Byrnes, who had produced an estimated 20-25% tier two in 2013, it marks a significant difference in his milk cheque. It is a far cry from the 28cpl for tier two.

He has estimated that his business is about 12cpl better off in 2014 than in 2013. “This year I applied lime to the ground, which is the first time in five years.  It is good for soil health, but we just couldn’t afford to do it before,” Mr Byrnes said.

He has also been encouraged to apply for a new project through the Australian government Reef Program to reuse effluent through his existing solid set irrigation. “It is a wasted resource if we can’t get it onto our paddocks. So it is a twofold benefit: it benefits the soil and it stops the effluent from contaminating waterways.”

Before the price rise, he had plans for disposing of replacement stock, whereas now he is hoping for modest growth.

Senior extension officer (soil science) Ross Henry said there had been a notable change in the industry over the last 12 months.

“Rewind 12 months to when we put out the first round of water quality grants there was still a good response but they were quite small projects and it was perhaps a bit light on,” Mr Henry said.

“The recent call for projects was quite soon after the price rise, and we had a lot of people put their hand up to talk about options. Some of those didn’t come through and they will apply again in 2015. But quite a few like Dennis’s have come through and they are going to be substantial projects where the farmer is putting in over 50 percent of the funding.”

James Geraghty with Dairy Farmers Milk Cooperative (DFMC) said the 2014 price rise had been a boon to the local industry.

“Coupled with the price rise was the rebranding of Dairyfarmers milk in North Queensland with the Malanda name and logo, which is something we had been seeking for 17 years. That has since resulted in a two percent rise in sales, which we hope will follow through and give us a higher price next year.”

He added though with a number of farm costs increasing, a number of farmers had commented that a further rise would be necessary this year.

“But hopefully the increase will help stabilise the industry and be a bit more incentive to grow for those farms who want to grow. Generally I think it has stabilised, but there is still a lack of confidence in going forward to reinvest.”

  • See the video of Dennis Byrnes here.