The New Zealand Dairy Industry

New Zealand is unique in that it exports 95 per cent of the 19 million tonnes of milk produced by New Zealand farmers, continuing a history of dairy exports spanning back to 1846.

A significant industry, dairy represents a quarter of all New Zealand merchandise exports.

New Zealand is the world’s largest exporter of dairy commodities, representing approximately one third of international dairy trade each year. 

New Zealand farmers receive no subsidies, which has encouraged a focus on low-cost, high productivity farming systems.  Processing facilities are mostly co-operatively-owned by farmers, with the main co-operatives being Fonterra, Westland and Tatua. 


The New Zealand dairy industry is predominantly pasture-based, with a temperate climate ensuring adequate feed for herds year-round. Dairy farming occupies 1.6 million hectares out of a total of 12 million hectares of pastoral land.

Dairy has been three times more profitable per hectare than other pastoral land use, encouraging conversions from other farming systems, such as sheep and beef, to dairy – especially in the South Island of New Zealand.  

A growing industry

2010/2011 was a record year for dairy in New Zealand. Highlights included: 

  • Total number of New Zealand dairy cows: Increased by 132,000 to just over 4.5 million cows (4,528,736) – an increase of 3 per cent over the 2009/2010 season. 
  • Average production per cow: Increased 5 per cent – to an average of 334 kilograms milksolids (comprising 190 kilograms milkfat and 144 kilograms protein). 
  • Milk processed by New Zealand dairy companies: 17.3 billion litres, with the total milksolids processed increasing from 1.44 billion kilograms in 2009/2010 to 1.51 billion kilograms. 

Reference: New Zealand Dairy Statistics 2010-11