Aaron T Simmons and David J Perović
NSW Department of Primary Industries
The production of dairy products is associated with environmental impacts, and these impacts have resulted in calls within the popular media to reduce dairy consumption for the benefit of the environment (e.g. Carrington, 2018; Eating Better, 2020). Impacts of current production are estimated by environmental footprints; the use of environmental footprints, however, can be misleading when used to influence consumer attitudes. Instead, the consequences of a proposed change need to be estimated by including the market effects of the proposed change. For example, to estimate the consequences of a reduction in Australian dairy production, we would need to consider the impacts of increasing the production of ‘functional equivalents’, products that would replace milk, butter, cheese, meat and other animal products that currently come from diary systems. In addition, an estimation of the consequences of a reduction in dairy production would also need to include the impacts of the commodities that would be then grown using the land and water that is made available once dairy production declines.