December 5, 2024

 

New Zealand's dairy sector production holds steady amid economic uncertainty

The New Zealand dairy sector has maintained stable production levels despite challenging economic conditions, according to the latest annual New Zealand Dairy Statistics report published by DairyNZ and LIC.

 

In the 2023/24 season, dairy companies processed 20.5 billion litres of milk, containing 1.88 billion kg of milksolids (kgMS). This represents a 0.5% increase in kgMS compared to the previous year.

 

DairyNZ chief executive Campbell Parker noted that the sector has undergone significant structural changes over the past decade, yet production levels have remained stable. He highlighted the importance of dairy exports in supporting New Zealand's economy during this period of transformation.

 

"We have seen our dairy herd numbers reduce by 12% over the last decade, and a 5% decrease in the total number of milking cows. Despite this, total milksolids processed have remained relatively stable, emphasising the resilience of our farmers and their focus on ongoing productivity improvement," said Parker.

 

The slight increase in total milksolids production for the 2023/24 season was attributed to a combination of marginal growth in cow numbers and favourable weather conditions.

 

Milksolids per cow reached an average of 400 kgMS, surpassing the five-year average of 394 kgMS per cow. Parker credited farmers' dedication, adoption of technology, and application of scientific insights for these gains.

 

Cow numbers stood at 4.7 million in 2023/24, a slight increase from 4.67 million in the previous season. However, this figure remains 2% below the five-year average of 4.80 million cows. The average herd size appears to have stabilised at around 445 cows per herd over the past three years, following a period of consistent growth until 2021.

 

The report also noted a slight decline in herd testing and artificial breeding uptake. Herd testing covered 77.1% of cows (3.62 million cows), down from the previous season. Artificial breeding rates remained stable at 81.1% (3.81 million cows), with a minor decrease.

 

LIC chief executive David Chin acknowledged these declines but remained optimistic about the sector's resilience and potential for recovery. "The dairy sector is still producing more kilograms of milksolids per cow, which is a great result driven by farmers' continued focus on improving cow productivity and farm efficiency. While there was a slight decrease in herd testing and artificial breeding uptake, these practices remain critical to the sector's success," he said.

 

Chin also highlighted a growing preference for crossbreed genetics, which contributed to a record-high average of 277 days in milk for the 2023/24 season. He emphasised the role of genetics, diagnostics testing, and farm software in improving herd health and productivity.

 

The average payout from dairy cooperatives, including Fonterra and Tatua, was NZD 8.90 (US$5.22) per kgMS for the 2023/24 season. This marks an increase from NZD 8.76 (US$5.14) in the previous season but remains NZD 0.35 (US$0.21) below the five-year inflation-adjusted average of NZD 9.25 (US$5.43) per kgMS.

 

-      Dairy News