The dairy industry has mixed feelings over the auction of another farm in the north

The neat Wyuna farm sold at auction late last week for $1.13 million with no irrigation water listed for sale and its dairy herd.

Today the 87 hectare (216 acre) property is a grazing and hay producing farm.

It once ran as a 110 cow dairy.

The vendors were said to be "very happy" with the selling price for their farm near the Goulburn River, in this renowned dairying district located between Echuca and Shepparton.

Despite the dairy industry coming off the back of record prices and companies scrapping for supplies, Victoria's dairy industry continues to shrink.

There are more than 3000 dairy farms in Victoria which still produce more than half the country's dairy exports.

But overall milk production is falling, dropping 4.1 per cent over the past year.

Staffing issues, higher costs for inputs like fertiliser and flooding all had an impact, industry analysts say.

The Victorian government has blamed the Murray Darling Basin Plan for taking water out of productive areas like Wyuna for the environment

More planned buybacks, warned a government report late last year, would reduce the irrigation area in northern Victoria by more than 50,000ha, a government report said.

The Wyuna farm on Agnes Road which sold at auction on Friday borders a state forest.

Buyers were told by successful agents from H&G Real Estate it came with a disused Herringbone dairy, a 1500 litre vat and a 40 tonne silo.

Forty per cent of the farm had been laser graded for ease of irrigation with four dams which could be used for recycling.

It also came with a three-bay machinery shed plus a three-bedroom home.

The cattle yards were partially under cover and it had a horse enclosure as well.

"A quality farm for many years, and now it's your opportunity to enjoy your own success," agents said.

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