Tough Times Ahead for NZ Dairy Farmers

NEW ZEALAND - Eighteen months ago milk was being called white gold in New Zealand but dreams of riches have since ended for producers of the country’s most important export commodity.
calendar icon 27 July 2009
clock icon 1 minute read

World prices for dairy products have more than halved since the beginning of 2008 when the country’s four million dairy cows—close to one for every human inhabitant—seemed set to lead New Zealand to new prosperity, reports ThePeninsulaQatar.

According to the news organisation, leaders in the industry, which accounts for about a quarter of all New Zealand’s goods exports, say the situation could worsen over the next one or two years but they insist longer term prospects remain bright.

“This downturn will put more inefficient farmers out of business and allow more efficient ones to thrive,” Federated Farmers dairy chairman Lachlan McKenzie said.

“It’s brutal and hard on some individuals, but it does drive efficiency.” When global prices hit their peak, there were expectations they would stick because of the growing world population and soaring demand in key new markets such as China.

Some of New Zealand’s 11,000 dairy farmers rapidly expanded their farms and others started converting sheep and beef farms into more lucrative dairy units.

TheCattleSite News Desk

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