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Flavio Macau, Associate Dean - School of Business and Law, Edith Cowan University

Floods, pandemics, wars and market forces: what's driving up the price of milk

Australia ABARES United States Woolworths

At the end of 2021, the cost of a litre of home-brand milk in an Australian supermarket was about $1.30. It’s now about $1.60.

What will it cost at the end of 2022? That depends on the continued effect of flooding on prime dairy-production regions in New South Wales, Victoria and Tasmania, as well as on global economic conditions.

The Australian Bureau of Agricultural and Resource Economics and Science has projected a 28% increase in the farm-gate milk price in 2022-23 – to 72.5 cents per litre, a record high. With less milk being produced, it could be even more.

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