An important rural industry

Dairy is one of Australian's leading rural industries in terms of adding value through further downstream processing. Much of this processing activity occurs close to farming areas, thereby generating industry and employment in country regions. With an (ABARE) estimated economic multiplier in the order of 2.5, the dairy industry generates total employment approaching 200,000 – a large majority of which is rural communities.

Ex-factory output was estimated at more than $8.5 billion in 2002/03.

Australia 's climate and natural resources are favourable to dairying and allow the industry to be predominantly pasture-based, with approximately 80% of cattle fed requirements coming from grazing. This results in efficient, low cost, high quality milk production. Most dairy production is located in coastal areas where pasture growth gena really depends on natural rainfall.