Feed prices are set to rise sharply this week, as Australia’s biggest beef processor and the country’s biggest dairy farmer announce that they are raising their prices for the second time in less than a year.
The price of beef has gone up more than 60 per cent over the past year and the price of milk more than 80 per cent, according to the Australian Meat Industry Association.
The two meat producers have raised prices for cattle feed, which includes hay, feed for poultry, cattle, sheep and pigs, and the cost of feed to farmers and ranchers.
On Tuesday, the price for beef rose by more than 20 per cent to $8.60 a kilogram.
The average price of feed in Australia has been $8 per kilogram for the past six months, according the Australian Bureau of Statistics.
For milk, prices increased more than 40 per cent.
The Australian Dairy Industry Association said prices for milk would go up another 15 per cent in 2019 and 20 per the following year.
A spokeswoman for the association said dairy farmers in Queensland, South Australia and Western Australia would have to cut their prices by as much as 40 per to 50 per cent by 2019.
“The price is going to go up by more then 50 per per cent,” she said.
The increase in feed prices was driven by a sharp rise in prices for hay.
The average price for hay in Queensland was $4.50 a kilo in June, according an ANA spokesman.
The price is now $7.50.
The prices for grain, which is the main feed used to make beef and pork, are also set to increase.
The industry group’s chief executive, Chris Durney, said the prices were driven by an increase in grain prices and a decrease in feed costs.
“We have seen a very big increase in prices, the amount of grain that is used to produce beef and we’re seeing a fall in feed,” he said.
“That’s what’s causing the price increase.”
The prices of pork, beef and beef products rose last week, but the price difference between pork and beef was less than one cent, he said, and he believed prices for pork and lamb would be relatively stable over the next few years.