中国和澳大利亚有望签署自由贸易协定

The free trade deal between China and Australia has been closely watched by a number of industries in Australia. Among those who hope to gain from the new agreement are the country’s dairy farmers.

Leppington is one of Australia's biggest dairy farms. Two-thousand cows in total, all housed in so-called "free-stall barns".

The technique is usually more expensive, but the farm's owners say: the better environment means twice the amount of milk per cow is produced.

Michael Perich says it was the right investmentand hopes a greater demand abroad may help offset some of his cost.

"Hopefully we can milk more cows with the same assets that we've got, so our fixed costs stay the same," Australian dairy farmer Michael Perich said. "More output for our fixed cost will help dilute it."

Some of the demand is now coming from China, the world's largest importer of dairy. There, Australian milk retails at more than five times the price compared to shelves back home. But that doesn't necessarily spell more profit per bottle sold.

"It has to go through quite a serious clearance process, and then it has to be put into cold warehouses around the country, and it has to go through distribution agents, and the agents have to sell to retailers, and of course there are taxes on the way into China," A2 Milk Company Phil Wohlsen said. "So really when you add all those things up, that's when you get to the really high prices in the Chinese market."

Wohlsen is hoping a new free trade agreement between China and Australia will both reduce export costs, and expand the market, ultimately increasing the volume of milk sold. And he expects sales to double annually, as China's thirst for high quality milk grows.

Australian dairy still represents just a small portion of the total milk sold in China. But it's a portion that's slowly increasing, as more and more Chinese mothers see the milk coming from here as a safe and healthy option. And changing trends there could mean changing realities here.

Over the last decade, dairy production in Australia has dropped by 25 percent, as farmers saw profits shrinking. A boom in demand from China, some predict, could encourage those who quit to start milking again. And that may change the industry.

"It'll have to adjust on a range of levels," Australian dairy lobbyist Mike Logan said. "The first level is in the manufacturing level. We need to attract investment in manufacturing, particularly around products like infant formular, those really high demand formulas. But then once that happens, we need to expand our production base."