Australia's milk production and the value of its dairy exports are expected to rise slightly in the year to 30 June 2004, according to the government's Australian Bureau of Agricultural and Resource Economics (ABARE).

Milk output is expected to rise 1.1% to 10.44bn litres this fiscal year, compared to 10.32bn litres last year, reported Dow Jones International News.

The value of the country's dairy exports is expected to rise to A$2.46bn (US$1.67bn), compared to $2.38bn last year.

"While international spot prices for dairy products have been rising, the strengthening Australian dollar over 2002-03 eroded the potential gains for Australian dairy processors," ABARE said.