Dairy numbers drop across SA

In April, this was as high as 233 - an increase on the 2018 figures, with two old cow dairies recommissioned. There are 212 cow dairies, five goat, two sheep and one buffalo dairy.

SA Dairyfarmers' Association president John Hunt said he was aware of some dairies, in the South East, being transformed into beef operations.

Mr Hunt said there were a combination of reasons why dairyfarmers might be leaving the industry, including poor returns and increased input costs, but for some it might have simply been the right time to step back.

"The dairy industry of the past four or five years has not been much fun so this is a good time to assess," he said. "The interest in land is giving people an exit opportunity."

He said milk prices had increased in recent months, on the back of strong demand.

Mr Hunt said this did raise questions about how sustainable these prices were but in the interim provided a "bit more optimistic frame of mind".

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Milk production slide continues

SA milk production has also declined for the opening months of the 2019-20 year.

Dairy Australia figures show the state's production was down 11.3pc for August, compared to 2018, and down 13pc year-to-date.

Mr Hunt said this could be a result of many dairies destocking on the back of drought and soaring fodder prices.

"A lot of people culled unnecessary cows and that would have a flow-on effect," he said.