NIOBIUM LABS M.E.P.E
Farminguk
01 May 2016 | Online since 2003
Rowett Insurance Broking Ltd


14 April 2014 11:12:04|Dairy,Finance,News

Australian dairy 'offers best risk returns in global agriculture'


Australian dairy currently offers the highest risk-adjusted return of any sector in global agriculture, according to Aquila Capital.
Surging global demand, especially from Australia’s regional neighbours in southeast and eastern Asia, means Australian dairy now offers internal rates of return of between 11-16% per annum.
The Australia Bureau of Agriculture and Resource Economics and Sciences forecasts that milk prices will at least remain unchanged over the next four years at 50 Australian cents per litre, but could head up to 52.5 cents per litre between 2018/2019.
In a scenario of this kind, investors in Australian dairy farms can expect to generate higher returns, with an Internal Rate of Return (IRR) of up to 16 percent p.a. possible. Even if milk prices were at the conservative estimate of 41.5 Australian cents, Australian dairy farms could generate an IRR of 11% from recapitalization and farm improvements, says Detlef Schoen, Group Head of Farm Investments at Aquila Capital.
Detlef Schoen commented: “The acceleration in demand has already caused the spread between supply and demand for dairy products to widen in recent years and this development is expected to continue. The OECD forecasts growth rates for milk and dairy products from emerging markets of between 1.6%-2.8%,1 which might lead to a potential demand overhang for dairy products of as much as five billion litres by 2020.
“Australia is very well placed to benefit from the increasing demand, exporting 50% of its domestically-produced dairy products.”
Dairy Australia, the national services body for the dairy industry expects production of all domestic dairy products to climb up to 2% in the 2013/14 season to more than nine million tons.

Download





1 Comment


Name

Please enter your name


Email

Comment

Please enter your comment


Post Comment

Your comment submitted successfully.Please wait for admin approval.


Comments

World News

United Kingdom | 29 April 2016
Banned pesticides 'not equally harmful' to bees

The largest field study so far in to the group of pesticides called "neonicotinoids" has concluded that each acts differently on the brains of the bees. One of the chemicals widely considered as be...


Canada | 29 April 2016
Competing ethical meat standards leave Alberta beef farmers in crossfire

Colleen Biggs and her husband, Dylan, own an award-winning livestock operation in Alberta. TK Ranch produces beef without antibiotics, drugs, added hormones, animal by-products and chemical insecticid...


India | 29 April 2016
Govt plans to use quarter of farmland for horticulture

In a bid to gain from Haryana's close proximity to the national capital, the state government has planned to use major chunks of agriculture land for horticulture in the state. The state governmen...


Austria | 29 April 2016
Negative effect on Austrian agriculture

The trade agreement between the US and Europe, TTIP, will have negative effects on employment and the biggest losses in jobs will be in the agricultural and food producing sectors. This is one of ...


New Zealand | 29 April 2016
Suicide concerns rise for farmers as dairy downturn takes its toll

A rise in substance abuse and domestic violence in Golden Bay's rural community raises concerns over suicide as the dairy downturn continues to bite, mental health workers say. Community Mental Hea...



Trending Now

Viewed
Discussed

Farms and Land for sale


Holiday Rentals search



Top stories you may have missed
Username
Password