Investor Presentaiton

The dairy industry in Tasmania 10 Value proposition A guide for investors Water availability A key component of sustainable agriculture is the availability of reliable water supply for irrigation. Dairy stocking rates are directly linked to the availability of water and Tasmania's most significant natural resource advantage is water. Tasmania does not have the water supply constraints experienced in other parts of Australia and much of the world. Tasmania represents one per cent of Australia's land mass, yet has 27 per cent of Australia's freshwater dam storage capacity. An ongoing priority in Tasmania is the completion of major irrigation schemes, with the potential to double the water available for irrigation. The Australian and Tasmanian Governments have committed $220 million to develop irrigation schemes with at least 95 per cent reliability of water supply, in partnership with local communities around the state. Private sector investment of around $93 million is also anticipated, which will double the amount of irrigable land available for production purposes. A comprehensive list of all current Tasmanian irrigation projects can be found at: www.tasmanianirrigation.com.au Farm irrigation Tasmanian dairy farmers are increasingly using irrigation to supplement rainfall and maintain pasture production through summer and early autumn. Mostly this is based on farm schemes utilising winter storage or direct take from rivers and, in some areas, groundwater also contributes to the total supply. Irrigation water requirements Irrigation water requirements depend on soil type, climate, soil fertility and pasture species. The estimated annual irrigation requirements for well-managed perennial ryegrass dairy pastures are shown in the table below. Irrigation of well-managed dairy pasture with high soil fertility is likely to increase pasture utilisation by three to four tonnes of drymatter per hectare per year, and this will typically require around four megalitres per hectare per year of water to be applied. Tasmania is in a unique position within Australia for increased investment in dairy farming. The state's expanding milk processing capacity offers opportunities and Tasmania's climate and water availability ensure consistent and predictable production rates. Climate Tasmania has an optimal climate for pasture-based dairying. Tasmania has a temperate climate, fertile soils, reliable rainfall and plenty of sunshine, all of which ensure excellent growing conditions for lush pastures that support the production of premium quality products. Modelling undertaken through the Climate Futures Tasmania project to 2040 and the Dairy Businesses for Future Climates project has shown Tasmania will remain globally competitive for perennial ryegrass production, the pasture that underpins the dairy industry of Southern Australia. King Island Flinders Island 800-1000 Rainfall Smithton Wynyard 1400 Burnie 1600 2000 2200 Millimetres of precipitation per year 2400 Devonport 1800 ⚫George Town 1000 800 Scottsdale 20 Deloraine ⚫Launceston 800 600 1200 Queenstown 1800 1400 1000 800 Campbell Town New Norfolk Huonville Hobart Table 2: Indicative irrigation requirements Region Location Irrigation requirement (ML/ha/year) North West Burnie 4.6 700-800 Currie (King Is.) 4.0 Mawbanna 2.6 Redpa 2.7 Sheffield 4.2 Smithton Woolnorth 3.9 Bicheno Wynyard www 3.0 3.9 North Cressy 5.3 Deloraine 4.7 Lilydale 4.5 Mole Creek 4.1 Ringarooma 3.5 Scottsdale 4.1 South Bushy Park 4.8 8. Water requirements of annual crops. Source: VW Maps O2009 Martin von Wyss, VW Maps Pty Ltd. Source: Macquarie Franklin, Farm Irrigation, January 2012 DPIPWE, Feb 2012.

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