Brazil’s Dairy Industry: Is a Giant Stirring?
Does it offer opportunities for investment and what are the implications for the Australian dairy industry?
Brasil is the fourth largest milk producing nation in the world, following India, USA and Russia. Production in 2008 is estimated to have grown, as a result of very favourable prices for raw milk in the twelve months to June 2008, by up to twenty per cent – to thirty billion litres. By way of comparison Australia’s milk production in 2008 is estimated at slightly over nine billion litres with approximately 45 per cent exported in a wide variety of dairy products and specialised food ingredients. Australia by value is the third largest dairy exporting nation.
Nick Renyard, a dairy farmer and industry representative from Timboon, south-west Victoria and Robert Pettit, Dairy Australia visited Brasil in the first two weeks of September. The purpose of the Visit was to understand and analyse dairy developments that will occur within Brasil in the next ten years and their commodity market impacts.
Nick Renyard –Florianopolis, SC in background
The visit focused on the five main milk producing states of Brasil. They are the tropical ‘heartland’ of Minas Gerais, the largest milk producing state and the adjoining state of Goias, a major milk producing region and the three states of temperate south Brasil; namely Parana, Santa Caterina and Rio Grande do Sul where dairying is the most progressive and organised and the family farm structure because of European settlement is strongest. Collectively the five states accounted for almost two-thirds of estimated Brasilian milk production in 2006 (16.067 billion litres) compared to 59.5 per cent in 1990 and 65.4 per cent in 2000. While Minas Gerais/Goias share peaked in 1999 at 41.3 per cent the combined share of the three southern states has been continuously rising since 1996, from 22.9 per cent to 27.7 per cent in 2006. The compound annual average growth rates of production in the seventeen years to 2006...
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