Government assistance and the changing distribution of dairyfarming in Australia

An important proportion of Australian dairy production has been destined for export markets, where prices are below those received on the home market. This degree of dependence on international prices has adversely affected dairy farm incomes and thereby influenced both Government responses to the industry's problems and dairymen's decisions about levels of production and farm viability. Examination of the spatial impact on the now declining Australian dairy industry of Government-funded subsidies and of schemes for reconstruction of non-viable dairy farms, has indicated that withdrawal of farmers from the industry has not been areally uniform at the national level; but study of a major dairying region whose industry has undergone substantial decline suggests that this uneven pattern reflects industry and regional characteristics more than the deliberate or inadvertent results of Government intervention. Although Government policy has been broadly directed towards reducing the numbers of dairymen, and hence dependence on overseas prices for production surpluses, industry change has been greatest in regions where viable economic alternatives have been available for low-income dairymen.