Nice one: Dairy delivers better way of life

for all Kiwis

29 August 2019

Every New Zealander is better off today thanks to the nation’s dairy cows – and that’s no exaggeration.

Professor Graeme Doole, DairyNZ principal economist.

We will continue to be better off into the future too, because of this important sector and its powerful linkages to the overall well-being of New Zealanders.

The nutritional benefits of dairy to the human body as part of a balanced diet are factually documented. Dairy is also central to many of our culinary cultures – from crumbly cheddar and smooth brie, to ice cream, yoghurts, and butter for baking or on toast with marmalade.

What might not necessarily be as readily understood is the way the dairy sector helps to provide many of the things Kiwis say matter to them.

As we look at what makes life here in New Zealand good, and what can make it better, I want to cast light on how dairy works with every drop of milk to help improve our lives, from helping to pay for the goods and services we value, to assisting to reduce the price of others, including imported items.

At the same time dairy farmers, who are such innovators and are so responsive to the signals they receive, are improving their environmental practices, be it fencing and riparian planting to protect waterways, installing upgraded effluent systems, or working to reduce greenhouse gases.

They are also playing a key role in communities nationwide as they work together to address issues with water quality.

Dairy is closely intertwined with the entire economy, contributing in so many ways to higher living standards for New Zealanders.  Quite simply, the healthier the country’s economy, the better the quality of our lives, both now and into the future.

The dairy sector will earn New Zealand around $17.5 billion in export revenue this year, and is set to top that next year. This is greater than the revenue accruing to the forestry, meat, and wool sectors combined.

The entire economy benefits from this expenditure through dairy’s spending, directly, as in what dairy farmers and dairy companies go out and buy from businesses across the country, and indirectly.

Dairy significantly helps to fill Government’s tax coffers too, providing more money to pay for the essential services that help to improve peoples’ quality of life – education, hospitals, social security and welfare, police and so forth.

In the 2018-19 year we estimate that dairy farmers paid around $0.5 billion in taxes. For the 2019-20 year they will likely pay even more.

Dairy also delivers for regional government with rates and other charges, helping to pay for local infrastructure and services. Last year, farmers alone paid more than $200 million in rates.

Currently, the dairy sector employs 46,000 workers – that’s the entire population of Timaru, Canterbury’s second largest city, or more than all those living in Wellington’s Upper Hutt.

On-farm there are 34,000 full-time equivalent employees, and a further 12,000 across 35-plus dairy processing plants.

Dairy sector employment has grown faster (+3.1 percent per year) since 2000 than the rate of national job creation (+1.8 percent per year), boosting rural communities.

Not bad credentials really.

Regional statistics 2017-2018

Northland

  • Dairy generated $320 million in regional GDP – dairy farming contributed $300 million; dairy processing $20 million at Fonterra’s Kauri and Maungaturoto sites.
  • Dairy provided 2,800 jobs – 2,200 on farm; 600 in processing.

Waikato

  • Dairy generated $2.2 billion in regional GDP – dairy farming contributed $1,600 million; dairy processing $600 million at 11 sites (Fonterra nine, plus one each for Tatua and Miraka).
  • Dairy provided 13,400 jobs – 9,900 on farm; 3,500 in processing.

Bay of Plenty

  • Dairy generated $500 million in regional GDP – dairy farming contributed $350 million; dairy processing $150 million at Fonterra’s Edgecumbe and Reporoa sites.
  • Provided 2,800 jobs – 2,400 on farm; 400 in processing.

Taranaki

  • Dairy generated $950 million in regional GDP – dairy farming contributed $800 million; dairy processing $150 million at Fonterra’s Eltham, Kapuni and Whareroa sites.
  • Provided 5,500 jobs – 3,700 on farm; 1,800 in processing.

Lower North Island

  • Dairy generated $700 million in regional GDP – dairy farming contributed $550 million; dairy processing $150 million at Fonterra’s sites in Longburn and Pahiatua, and Open Country’s in Wanganui.
  • Provided 4,400 jobs – 3,100 on farm; 1,300 in processing.

West Coast-Tasman

  • Dairy generated $260 million in regional GDP – dairy farming contributed $250 million; dairy processing $10 million at Fonterra’s Takaka site and Westland’s near Hokitika.
  • Provided 2,100 jobs – 1,500 on farm; 600 in processing.

Marlborough-Canterbury

  • Generated $1.5 billion in regional GDP – dairy farming contributed $1.2 billion; dairy processing $300 million at five sites – Fonterra’s at Brightwater, Clandeboye and Darfield, Synlait’s at Dunsandel and Westland Milk Product’s at Rolleston.
  • Provided 8,500 jobs – 6,000 on farm; 2,500 in processing.

Otago-Southland

  • Generated $1.1 billion in regional GDP – dairy farming contributed $950 million; dairy processing at $150 million at five sites – Fonterra’s at Edendale and Stirling, Open Country’s at Awarua, Danone’s at Balclutha and Mataura Valley Milk’s near Gore.
  • Provided 6,100 jobs – 5,100 on farm; 1,000 in processing.

Media inquiries:

Maggie Kerrigan

Senior Communications & Media Specialist

Phone 027 237 0358

maggie.kerrigan@dairynz.co.nz

Lee Cowan

Senior Engagement & Communications Manager

Phone 021 930 836

lee.cowan@dairynz.co.nz

 

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