Why Fonterra accepted defeat in the dairy aisle
OPINION: Fonterra's sale of its consumer dairy business to Lactalis is a clear sign of the co-operative’s failure to compete in the branded consumer market.
The 349ha property will run 640 cows next season but plans to increase cow numbers to 800.
AgResearch and DairyNZ have each paid $5 million towards the venture and the Southern Dairy Development Trust, made up of farmers, has put in $1.25m.
AgResearch chairman Sam Robinson says the organisation has played a key role in developing the property at Makarewa, 15km north of Invercargill. The new facility will be made up of two independently owned adjoining beef and sheep farms.
“The plan is to convert the existing farm operation into a dairy farm this season and then supply Fonterra at the start of the 2017-18 season. It will initially milk 640 cows but that will increase to around 800 cows,” Robinson says. “It will further the science developments in the sector.”
DairyNZ chair Michael Spaans says its investment in the hub reflects the importance of dairying in the south and is a prompt for innovation, industry-led research and education.
“The hub will provide relevant, up-to-date local research for Southland dairy farmers. [Now comes] the development phase, and farmers will see research getting underway next season.
“This is a key project for DairyNZ and Southland dairy farmers will gain a lot of value from it.”
The hub project recognises that dairy farming techniques used in other parts of New Zealand are not easily adapted in Southland, given its unique landscape, climate and soil types, DairyNZ says.
Matthew Richards, chair of the Southern Dairy Development Trust, referred to the region’s long dairying history and its important role in the community.
“This development will help southern farmers further increase farm efficiency, productivity and sustainability, and thus continue to enhance the wider southern region.”
