Survive or Thrive: The Future of New Zealand Dairy 2017-2022

In the space of just 20 years, New Zealand’s milk industry has seen remarkable growth, with production more than doubling. But the seemingly endless milk supply growth has recently stuttered… is this the end of growth as we know it?

picture of new zealand cow

Report summary

•    New Zealand’s dairy industry has ensured a consistent stream of milk supply growth for the past 20 years—but it has recently stumbled.

•    Beyond the 2017/18 season, constraints will begin to impede on New Zealand farmers’ ability to produce larger volumes of milk.

•    While production growth will still be achievable, albeit at a smaller rate, the slowdown in New Zealand milk flows will have vast implications for the entire supply chain.

•    Competition at the farmgate for milk supply will further heat up, with processors looking to ensure optimal capacity utilisation.

•    Dairy farmers will likely benefit as increased competition for milk brings sharper pricing and a wider range of contractual options.

•    Strategic sourcing of New Zealand milk supply by international players may require more investment and time.