VICTORIAN dairy farmers Gary and Debbie Stockdale, of Merino, could be considered an endangered species.

The couple farm on land which has been in Gary's family for three generations and is on one of several soldier-settlement blocks set up in Victoria's Western District after the first and second World Wars.

Back then, hundreds of farmers from these blocks supplied cream to the local factory, which was built in 1910 and upgraded in 1931.

In 1937, as Merino celebrated its centenary, a historian described Merino Downs butter brand as "the hallmark of quality".

"It is the common stipulation with interstate merchants when ordering Victorian butter to request: It must be Merino," he wrote at the time.

Today, Merino brands are more about sheep than butter and the Stockdales are among only seven dairy farmers in the Merino district and about 12 farming within 30km of the town.

The factory, which Gary actually owns, is in disrepair after closing in the 1960s and parts of it are now used to store hay.

But that doesn't mean you can't produce good and profitable milk in the rolling hills of Merino.

"It has been very viable," Gary said.

Gary grew up on the farm and worked away a few years before returning to milk about 100 cows on 85ha in 1980.

He gradually expanded the farm size and herd and moved from a small herringbone to his current 22 aside.

These days he and Debbie milk 271 cows on 240ha, land which also hosts their replacement stock.

They were milking more but have cut back numbers slightly in the recent dry years.

"We haven't had a good spring for a while, it has been hard to maintain the pasture that we did have," Gary said.

Catchment dams also reached a critical low in the 2006 drought before rain replenished them just in time.

While the hills look magnificent in winter and spring, a run of dry and warm weather can turn them blonde very quickly.

Summer crops in the valleys are not always easy either with a persistent fat hen weed problem.

Recent rains of 100mm have provided a welcome late-spring soaking, which should help with summer crops and pasture growth.

The paddocks are now up in a 10-day rotation, although Gary hopes to spread this further in the future.

Cows receive one tonne of grain annually and are joined to calve from April 1.

While dairying numbers may be few, Gary said he didn't feel isolated farming in the Merino district.

"There are still plenty of people but they aren't all dairy farmers," he said.