• Conventional production has had two years of large losses and is expected to have a third in this coming season (2016/17)
  • Average cost of production for conventional is $5.25/KgMS with a milk price of $3.90/KgMS this year and $4.25/KgMS is the opening forecast for the next season (16/17)
  • Organic average cost of production is below $4/KgMS and the organic milk price forecast for 16/17 is $9.20/KgMS
  • Yields from grass based organic systems seek to match or better conventional grass based production
  • Organic margin +$5.20/KgMS, conventional margin $-1.35/KgMS and next year $-1.00/KgMS
  • Organic prices have been consistently strong for the last three years with demand continuing to grow and comfortably ahead of supply
  • Select assets can be acquired up to around 40% cheaper than 12-24 months ago
  • The distress in the conventional sector combined creates a compelling window for asset acquisition at attractive prices

By the Numbers

Organic Conventional
Milk Price Forecast $9.20/KgMS (16/17) $3.90/ KgMS (15/16)

$4.25/KgMS (16/17)

Average Cost of Production Under $4/ KgMS $5.25/ KgMS
Margin +$5.20/ KgMS (16/17) -$1.35/ KgMS (15/16)

-$1.00/ KgMS (16/17)