Dairy cows

24.05.17

Dairy farming is a major rural industry in Australia with over 5,700 dairy farmers producing around 9 billion litres of milk per year. Dairy cows are bred and raised for the production and harvesting of milk for human consumption. A dairy is typically located on a dedicated dairy farm or section of a multi-purpose farm.

Overview

The milk that dairy cows produce is processed into a range of consumer products, including fresh milk, cheese, custard and yogurt as well as long life products such as powdered milk.

Dairy farming is also one of Australia’s leading rural industries in terms of adding value through downstream processing. As a major regional employer, the industry value-adds through the processing of milk to produce fresh products such as butter, cream, cheese and yogurt. Much of this processing occurs close to farming areas, thereby generating economic activity in country regions.

In Australia, dairy cows are generally farmed to coastal areas with a mild climate and sufficient rainfall or access to irrigation to produce nutritious pasture. Victoria is the most prominent dairy farming state in Australia followed by Tasmania and New South Wales. About half of Australian dairy production is exported making the farm gate price closely linked to the export price. Australian dairy exports accounted for 6% of world dairy trade.

The Australian Dairy Industry Council (ADIC) is the peak national representative of Australia’s dairy industry. Dairy Australia is the national services body for dairy farmers and the wider industry, investing in research and development to assist the industry adapt to achieve the most profitable returns possible. The Dairy Australia website provides extensive information about the industry and dairy farming, and is referred to extensively in the information provided here.

Facts and figures

  • Australia’s national dairy herd stood at 1.51 million cows on 5,700 registered dairy farms across Australia
  • Australia produces around 9 million litres of milk annually of which 37% is exported to countries such as Japan, China, Indonesia and Malaysia
  • Dairy is Australia’s third largest rural industry
  • The average size of a dairy farm herd has increased from 85 cows in 1980 to 261 cows

Production Status

There are currently working dairies located in all states and territories of Australia. Victoria is Australia’s largest producer, accounting for about 64% of national production, followed by New South Wales with around 12%, Tasmania approximately 9%, Queensland about 5%, South Australia approximately 5%, and Western Australia around 4%.

Some areas are especially strong productive dairy regions due to climate, reliable water supplies and their proximity to fodder and grain growing regions. The Murray dairy region (an area spanning parts of southern New South Wales and northern Victoria) is an example of one such area where the farms are generally smaller, but carry more cows and produce more milk than the national average.

Australia’s sub-tropical dairy region, however, has a variety of environmental, climatic and production conditions which pose some unique challenges to dairy farming.

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Map of current and potential growing regions

Uses

The primary product from dairy cows is milk which is pasteurised and homogenised and then sold as milk or used to produce a range of products including cheese, custard and yogurt. Long life products such as UHT milk and powdered milk are also a significant product.

While many dairies sell directly to a processor or supermarket, some farms produce and market their own products which they sell direct to the public or retailers. Products include milk, cheese, yogurt and cream.

Production Requirements

Growing regions

Dairy farming is a well-established industry across temperate and some subtropical regions of Australia. While the bulk of milk production occurs in south-east states, all states have dairy industries that supply fresh drinking milk to nearby cities and towns.

The main considerations for evaluating a suitable region for dairy farming are:

  • the ability to grow pasture
  • reliable water supplies for growing pasture and cleaning milking machinery
  • proximity to processors
  • access to reliable labour force

Climate

Dairy farms are most prevalent in high rainfall coastal zones due to the requirement for growing pasture as feed for the cows, although irrigated dairy farming does occur in inland regions. Irrigated inland dairy farms are located in the southern New South Wales, Tasmania and northern Victoria Murray-Darling Basin areas.

Climate is also important for the welfare of cows as hot weather increases the risk of heat stress which can also lead to reduced milk production. Cows have a range of mechanisms to off-load heat, but at temperatures above 25°C, cows begin to feel uncomfortable. In periods of high temperatures and humidity, the provision of shade and free access to drinking water, milking earlier or later in the day, minimising the distances the cows have to walk, and using active cooling sprays and/or fans in the milking area are important heat stress management tools.

As climate and weather significantly impact dairy farming from growing pasture to animal health, managing climate variability and climate change are specific issues for the future of dairy farming in Australia. These considerations are particularly important for areas that are considered marginal for dairy farming. For further detailed information on the current and projected impacts of climate change on dairy farming, refer to Dairy Australia’s Dairy Climate Toolkit.

Housing

Paddock fencing is required for rotating the herd through pastures for feeding but specific housing is generally not required in Australia except for young calves prior to weaning A small proportion of farms with more intensive feeding systems choose to house cows for some or part of the year.

Under high temperatures and humidity it is important to provide cows with shade and try to limit the distances they have to walk. Infrastructure such as cooling sprays and fans may also be required.

Feed requirements

In Australia, dairy cows generally graze on pasture and forage crops and have access to supplementary feeding while being milked in the dairy. Supplementary feeding may also be required in the paddock, depending on the season and reproductive stage of the herd.

Energy and protein are the two major feed requirements for dairy cows, and the most important factors in calculating feed rations. Energy is the most common nutritional deficiency limiting productivity, while protein is a vital requirement for growth, pregnancy and milk production. Dairy cows require higher quality feed than beef cattle do, and consequently eat more – about 40kg of nutritious food a day – so they can meet their bodily demands to produce milk.

Growing nutritious pasture and forage is a key element of dairy farming and a key driver of farm profitability. Pasture and forage crops grown for dairy cows include perennial ryegrass, lucerne, red and white clover, tall fescue, turnips, millet, sorghum and chicory. For more detailed information on growing and managing pasture for dairy cows, refer to the following resources:

Silage is also an important strategy for managing feed requirements when availability of fresh pasture is limited. Silage and hay are forms of stored fodder which can be grown and made on farm or purchased. Silage can be stored in pits, bunkers, stacks. Hay is cut and dried then packed into large round or rectangular bales. The method of storage and how it is delivered to the cows will depend on the size of the enterprise, layout of the farm and the number of cows. For more detailed information on hay and silage for dairy farming, refer to Dairy Australia’s web page on Crops.

An alternative feed regime is to maintain the dairy cows in a feedlot where a balanced ration is delivered to the cows each day. This provides advantages in terms of making the management of milking and general husbandry easier, but has higher capital, operating and feedstock costs.

For more information on feeding systems used on Australian dairy farms, refer to Dairy Australia’s web page on Pasture and feeding technologies.

Breeds and breeding

There are a range of cattle breeds used in Australia for commercial dairy farming. These are specialised breeds that have been bred specifically for milk production. Some of the main breeds used in Australia are:

Holstein Friesian

  • Originate from the Netherlands
  • Main colours are black and white
  • Holstein cows are the most popular dairy breed worldwide
  • Of Australia’s 1.7 million dairy cows, 1.4 million are Holstein
  • Highly productive and large framed

Jersey

  • Originate from the island of Jersey in the English Channel
  • Small, fawn coloured, with black tips on their muzzles, ears, feet and tail
  • Jersey cows are the second most common breed in Australia
  • Jersey cow milk is ideal for making butter because it is so creamy

Aussie Red

  • Originally bred in Australia by combining Scandinavian Red genetic lines with other Australian Red breeds such as the Illawarra and Ayrshire
  • Extremely hardy, medium-sized and mainly red in colour, with white markings
  • Milk has a high protein content and medium milk fat content

Illawarra

  • Developed in New South Wales and recognised as a new cow breed in 1910
  • They are a rich red colour with a little white on the flanks
  • Highly productive
  • Originate from Switzerland
  • Solid brown varying from very light to dark
  • The Brown Swiss cattle population is one of the largest throughout the world

Guernsey

  • Guernsey cows were originally developed in the Isle of Guernsey in the English Channel
  • Fawn coloured with white markings
  • Produce a distinctive golden coloured milk

Ayrshire

  • Originate from Scotland
  • Vary in colour from light to deep cherry red, mahogany, brown, or a combination of these colours with white. Some are all white.
  • Highly productive

Dairy cow herds are bred on-farm to maintain herd size and milk production volumes. A dairy herd is made up of four different groups of cattle:

  • Cows – the adult females, who give birth to calves and produce milk. Most of the cattle in a dairy herd are cows.
  • Bulls – the fathers of the dairy herd. Only a few are needed on a dairy farm (also see Artificial Insemination (AI)).
  • Heifers – young female cattle, who are the ‘teenagers’ of the herd and have not yet had a calf. They are the second biggest group in the herd.
  • Calves – baby cattle. Female calves grow into heifers and then milking cows. Male calves become bulls and are often sold.

Managing breeding is an important element of dairy farming. Selecting cows for breeding can be a complex decision process where genetics, milk production, and herd health and management are all important factors for consideration. For more detailed information on the genetics of breeding dairy cows, refer to Dairy Australia’s web page Genetics.

Sourcing stock

Dairy cows can be purchased through online auctions, saleyards or directly from a producer. Once established, stock numbers can be built or maintained through breeding on-farm.

There are a number of factors to consider when purchasing cattle, including:

  • All properties that run livestock must be registered with the state Department of Primary Industry and have a Property Identification Code (PIC). This is needed to buy and sell livestock and before ordering National Livestock Identification System (NLIS) devices.
  • All cattle must carry NLIS devices.
  • You should obtain a copy of the vendor declaration for your purchases
  • Any stock movements on or off the property must be recorded on the NLIS database by the person responsible for the cattle. In the case of sales it is usually the purchaser.

Health care & pests and diseases

Animal health, welfare and biosecurity are important at all stages of animal production and if managed poorly, can adversely impact productivity. The dairy industry has biosecurity programs in place which are designed to prevent the spread of infectious disease and contain disease outbreaks when they occur. Biosecurity is important at the national, regional and property level and farmers need to have a complete understanding of the requirements of these programs.

Caring for a dairy herd is very hands-on and time-consuming. Cow health and comfort is directly linked to milk production and therefore commercial viability of the business. To ensure a healthy and productive herd, cows must be handled in a calm manner, and maintained in a stress-free environment.

Day to day care for a dairy herd includes:

  • daily feeding including monitoring animal body condition and milk production and adjusting diets accordingly
  • supplying and managing water – dairy cows drink up to 100L of fresh water a day
  • monitoring cow health including inspecting cows for signs of infection and lameness
  • monitoring that cows after calving and ensuring that the calves are healthy and growing
  • maintaining infrastructure and facilities such as laneways, fencing, troughs and milking equipment

There are a number of diseases that can affect dairy cows in Australia including Bovine Johne’s Disease and Listeria. Dairy Australia provides a page on animal health and how to identify the main signs of each disease.

Dairy cattle, as with any other livestock, can suffer from pests such as ticks, worms, buffalo fly and lice. Treatment regimes are well established and include chemical and medical treatment.

For more detailed information on health care, pests and diseases refer to Dairy Australia’s web page on Animal Health. The Australian dairy industry has also developed a National Dairy Industry Animal Welfare Strategy that provides guidance to farmers on caring for a dairy herd.

State and territory governments are responsible for animal welfare laws and their enforcement and it is important to understand legal requirements for caring for animals. The states and territories have developed animal welfare standards for cattle and these are enforced through animal welfare or prevention of cruelty to animals legislation. The Australian Animal Welfare Standards and Guidelines provide a resource for people responsible for the welfare and husbandry of a range of livestock animals.

Infrastructure Requirements

The infrastructure needed for establishing a dairy are extensive and include grazing management, feeding systems and milking management. A range of buildings, equipment, and machinery is needed including:

  • land for pasture and paddock rotation
  • laneways and roads
  • general farm equipment for sowing and growing pasture or forage  (tractors etc.)
  • equipment for managing feed (storage, tractors, loaders etc.)
  • infrastructure for effluent disposal
  • milking shed and milk harvesting machinery
  • adequate facilities for cooling and storing milk
  • infrastructure for calf rearing and other animal husbandry procedures
  • areas for feed storage (concentrates, silage and/or hay)

Harvesting & Processing

Cows are milked on farm using specialised milking equipment and machinery. A dairy herd is habituated to being milked from one to three times a day and will attend the milking shed to be milked on an established schedule. Milking is the most time consuming activity of dairy farming and most farmers spend about four hours a day on this task alone.

The industry is investigating automated milking systems (AMS) which are totally automatic, with the cows entering the dairy shed and being milked without assistance from the farmer. While these systems have been used for many years overseas they have been designed for smaller herds that are often housed indoors and so the systems are not tailored for Australia’s larger, pasture based herds. Only a few dairy farms in Australia have installed AMS, and the industry is looking into the constraints to adopting these systems more broadly. For more information visit TheFutureDairy website.

Once harvested, milk is stored on-farm in stainless steel vats which cool and store the milk at 4°C. Milk is then pumped into stainless steel tankers for transport to a processor. At this stage, milk samples are taken, analysed for composition and quality and tested for bacteria, somatic cell counts and residues. Processors have strict quality standards which can be more stringent than legislative requirements and farmers need to have a clear understanding of their processor’s requirements. Milk is then pasteurised and homogenised and either packaged for sale as milk or processed further to produce other dairy products such as yogurt, cheese, butter or milk powder.

Some dairy farmers process milk on farm to produce their own products such as yogurt and cream. However, milk processing is governed by strict food safety guidelines and codes that must be adhered to (see Risks and Regulations for more information). If considering on-farm processing or producing other products from milk, a full understanding of food safety requirements is required and expert advice should be sought before proceeding.

For more detailed information on milking, refer to Dairy Australia’s web page on Milking.

Markets & Marketing

The industry is facing opportunities and challenges from a marketplace that is increasingly complex. Being able to understand and monitor the key drivers of industry profitability is an important to support effective decision making.

There are a number of options available to dairy producers for selling milk and they each vary in their efficiency and suitability for individual enterprises and circumstances. Options include:

  • Forward contracts – A contractual agreement between a seller (e.g. producer) and buyer (e.g. processor) to supply a given product at a future point in time for a given price. In some cases the price is fixed, thereby reducing the producer’s exposure to a fall in market price.
  • Producer alliances – A group of producers working together to service market place requirements.
  • Value-based marketing – Based on the principle of being paid for the inherent value (quality and quantity) of the product to the buyer and the end user, such as systems that provide clear feedback from the consumer to the producer and has a pricing system supporting these signals.

Australia sends approximately 40% of the dairy products it produces to other countries, while 60% are sold within Australia. Australia is the third biggest dairy exporter in the world and ships dairy products to more than 100 different countries. The most common products exported are cheese, butter and milk powder. Australian dairy foods have a large market overseas – especially in countries where it is either too hot or dry to keep cows, or where there is very little room for, or experience in, dairy farming. International prices are the major factor in determining the price received by farmers for their milk. At an average of approximately US0.42c per litre, Australian dairy farmers receive a low price by world standards and therefore have to run very efficient production systems.

While export markets are significant for dairy farming and directly affect the farm gate prices, farmers generally do not directly access these markets. Rather, farmers sell to processors who access and sell to export markets.

Dairy Australia provides exporters assistance to develop and maintain access to overseas markets, thereby maximising potential returns to farmers.

Risks & Regulations

Risks/challenges

Like any primary production enterprise there are a range of risks associated with commercial dairy farming. These include the loss of vital markets, weather, disease and pests, input prices and the price of products sold. For dairy farming, market volatility can significantly affect the price received by the farmer from year to year with changes in the range of 30% being experienced in recent years.

Many of the risks associated with dairy farming will be outside of a farmer’s control but there are a range of tools developed by Dairy Australia that can assist producers better manage these risks.

Regulatory considerations

As milk and dairy products are produced for human consumption, there are a range of food safety standards relevant to dairy farms and processors.

The National Dairy Food Safety Regulatory Framework is an integrated system developed by industry organisations and federal and state regulatory agencies to deliver food safety in the dairy industry. This framework incorporates state, national and international legislative requirements including Food Standards Australia New Zealand (FSANZ) Standard 4.2.4.

Food safety regulations apply at all levels of the dairy supply chain and this framework incorporates legislative requirements at the pre-farm, farm, transport, manufacture, distribution and markets stages.

One of the most important elements of this framework for farmers is the requirement for all dairy farms to have a documented food safety program which must be approved by the relevant State Dairy Food Authority (SDFAs) before a dairy farm licence is granted.

Dairy farms must be licenced to operate by their State Dairy Food Safety Authority. Specific requirements can vary from state to state. For example, in Victoria, Dairy Food Safety Victoria requires a HACCP based Quality Assurance Program be implemented on farm. The Quality Assurance Program covers food safety, animal welfare, chemical contamination, and environmental responsibilities.

In addition to on farm safety and food standard requirements administered by the relevant State Dairy Food Safety Authority, processors may apply more stringent quality standards to their suppliers that may be more than the legislated minimums.

Auditing is carried out by SFDA’s who audit all dairy farms every one or two years. This aims to ensure dairy farmers and processors assess food safety risks and ensure strategies are in place to deal with the risks (includes full traceability up and down the input chain).

If considering processing on farm (in addition to milk production), it is important to understand the additional food safety requirements and legislation applicable to processors. To assist with understanding regulatory requirements, refer to the National Dairy Food Safety Regulatory Framework.

Publications

Publications/information

Dairy Situation and Outlook – Dairy Australia

Dairy – Agriculture Victoria

Dairy – New South Wales Department of Primary Industries

Animal Management – Dairy Australia

Animal Health – Dairy Australia

Crops – Dairy Australia

Dairy cattle fodder production and animal nutrition – New South Wales Department of Primary Industries

Nutrition and milk  – Agriculture Victoria

Milking Cows – Dairy Australia

Dairy Climate Toolkit – Dairy Australia

National Dairy Industry Animal Welfare Strategy

Other resources

Commonwealth Department of Agriculture

Queensland Department of Agriculture, Fisheries and Forestry

New South Wales Department of Primary Industries

Agriculture Victoria

Tasmanian Department of Primary Industries, Parks, Water and Environment

Primary Industries and Regions South Australia (PIRSA)

Department of Agriculture and Food Western Australia

Food Standards Australia New Zealand (FSANZ)

Animal Health Australia (AHA)

Dairy Food Safety Victoria

NSW Food Authority

Safe Food Queensland

National Dairy Food Safety Regulatory Framework

Australian Animal Welfare Standards and Guidelines

Industry Bodies

Dairy Australia is the national services body for dairy farmers and the industry. Their role is to help farmers adapt to a changing operating environment, and achieve a profitable, sustainable dairy industry.

The Australian Dairy Industry Council (ADIC) is the peak national representative of Australia’s dairy industry.

Image Gallery

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Grazing Dairy Cows (source Dairy Australia)

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Friesian dairy cow

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Milking machinery (source Dairy Australia)

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Pumping milk from farm vat to tanker (source Dairy Australia)

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A range of dairy products (source Dairy Australia)

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Jersey dairy cow

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A Dairy (source Dairy Australia)

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Milk processing facility (source Dairy Australia)

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Filling plastic milk bottles (source Dairy Australia)