A wide variety of dairy products are produced in New Zealand including fluid milk, milk powders, butter, cheese, and infant formula. To produce the vast array of products, thousands of dairy farms across millions of hectares of land are home to millions of dairy livestock. The number of dairy cattle was higher than the population of the nation at 6.35 million in 2019. Dairy farming provides thousands of New Zealanders and migrants with direct employment across the country, and the dairy workforce continues to grow each year. Additionally, indirect employment in relation to the dairy sector, from construction activity to logistic operations, further supports the New Zealand economy.
New Zealand has a reputation for delivering high quality dairy products across the world and has created a name for itself as a world leading dairy exporter. The nation is the largest exporter of whole milk powder (WMP), with around 95 percent of the milk produced in New Zealand processed to be exported. Other important export products include butter, cheese, infant formula, and skim milk powder. China, Australia United States, United Arab Emirates, and Japan are the country’s biggest trade partners for dairy products.
Most of the milk produced in New Zealand is further processed by farmer-owned cooperatives. Fonterra is not only the major milk production and processing company in New Zealand, but also one of the biggest dairy companies in the world. The co-operative buys milk from its 10,500 farmer shareholders and processes it mainly for export. In recent years, Fonterra reported its first ever financial loss, and did not pay out dividends in fiscal year 2019. Other major players in the local dairy industry include Open Country Dairy Limited, Synlait Milk Limited, and Westland Co-Operative Dairy Company Limited.
While sales of dairy milk have remained relatively stable, the alternative milk market has experienced substantial growth. Non-dairy alternatives include soy, oat, almond, rice, and coconut milks. The boom in sales of these products coincides with more Kiwis opting for a plant-based diet. With this segment growing locally and internationally, New Zealand’s core dairy products my face even more competition in the future.