Despite a surge in world prices of almost 20 per cent at this week’s global dairy auction, dairy farmers are being warned not to expect a big pay rise just yet.
Tight world supplies and increasing demand from China prompted the jump in prices, with the turnaround coming after four consecutive months of decline that wiped about a quarter of the value from some dairy produce.
Norman Repacholi from Dairy Australia admits that it is an unexpectedly good result, but not enough to boost the pay packets of dairy farmers.
"I don't think it's enough to jump up and down and celebrate that there's going to be a raft of new step-ups,” he says.
Norman does note, however, that the surge will take some of the pressure off dairy farmers after four months of decline.
“I certainly think that it will provide some confidence to the budgets that were set at the beginning of the year," he adds.