Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


China’s ‘white gold rush’ – opportunities for NZ dairy

China’s ‘white gold rush’ – opportunities for New Zealand dairy

The Chinese dairy market is one of the world’s largest – and most significant – being the fastest growing, presenting big opportunities for the New Zealand dairy industry to cash in on China’s ‘white gold rush’, according to Rabobank.

Visiting dairy farmers around New Zealand last week, Shanghai-based Rabobank senior dairy analyst Sandy Chen says that the rising income of currently low-income consumers will drive growth of dairy demand into the next decade.

Mr Chen says the imbalance in the development of supply chains in China has led to a series of milk contamination – be it deliberate or accidental – scandals in recent years, which have contributed to the rising wave of imports seen going into China.

“The reliance on imported feed components and other challenges such as availability of land, water, biosecurity considerations and environmental protection factors will make it difficult to increase self sufficiency levels quickly for China,” Mr Chen says.

“With ongoing investments into their dairy industry capacity, local supply will rise over time but this will come at a cost.”

Adding to this, Mr Chen says that product safety has become an increasing concern for the Chinese consumers and this will be an important factor when it comes to brand value in the future.

Part of Rabobank’s Food & Agribusiness Research and Advisory division, Mr Chen
joined Rabobank in early 2013. In this role he researches and analyses trends and developments in the Chinese dairy market.

Mr Chen says that China already dominates the global traded market for dairy
commodities so greatly that small changes in China’s demand and supply balance have a large impact on the global market and therefore commodity prices.

“As a result of how important China is in the global market place, New Zealand dairy farmers should endeavour to keep up to date with Chinese market trends,” he says.

“High milk production costs in China, for example, will result in imported product remaining attractive and this will continue to play an important role in fulfilling Chinese demand.”

Regulatory changes in China will also continue to impact the supply chain, Mr Chen says, and all participants will need to keep informed and adapt quickly.

“Chinese dairy consumers are already sophisticated and place high expectations on milk producers for quality, food safety and sustainability characteristics, providing a high level of evidence in these areas will become more and more crucial,” he says.

“This is where New Zealand has an opportunity to take advantage of its image as a reliable producer of quality, traceable dairy products destined for the international market. The fundamentals are there, now it’s time for the New Zealand industry to secure that market share by finding its ‘edge’ on other competitors looking to the Chinese dairy industry opportunities.”

Mr Chen presented these views to industry stakeholders and dairy farmers last week in various locations including New Plymouth, Wanganui, Palmerston North, Masterton, Invercargill and Christchurch.

Rabobank regional manager East Coast George Murdoch says that bringing an expert such as Sandy to meet with clients in their local areas provides extremely valuable insights for farmers interested in the opportunities taking place in China at present.

“China has been an integral part of the global dairy market for quite some time now and hearing Sandy present this week has reinforced the future growth that will materialise in due course,” Mr Murdoch says.

“Giving our clients a chance to hear Sandy and his current on-the-ground perspectives of the Chinese dairy industry really benefits local dairy producers to gain insights into a very important market. With Rabobank’s sole focus on agriculture, this sort of first-hand knowledge-sharing is a massive value-add for our clients, helping them to make informed decisions for their business.”

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

BusinessDesk: SkyCity Lifts Minimum Convention Centre Investment To $430M

SkyCity Entertainment Group, the casino operator, has lifted the minimum it will invest in the Auckland International Convention Centre to $430 million and said total costs including land may be $450 million to $470 million. More>>

Statistics: Drop In Dairy Prices Leads Fall In Exports

Total goods exports fell $240 million (5.5 percent) to $4.2 billion in April 2015 compared with April 2014, Statistics New Zealand said today. More>>

BusinessDesk: APN's NZME Sees Future In Paywalls, Growth In Digital Sales

APN News & Media has touted a single newsroom concept for its NZME unit in New Zealand, similar to what Germany's Die Welt uses, saying an 'integrated sales proposition' is helping it win market share, including ... More>>

Labour Party: Global Milk Prices Now Lowest In 6 Years

The latest fall in the global dairy price has brought it to the lowest level in six years and shows there must be meaningful action in tomorrow’s Budget to diversify the economy, says Labour’s Finance spokesperson Grant Robertson. “Dairy prices ... More>>

BusinessDesk: NZ Inflation Expectations Creep Higher In June Survey

May 19 (BusinessDesk) - New Zealand businesses lifted their expectations for inflation over the next two years, sapping any immediate pressure on the Reserve Bank to cut interest rates, and prompting the kiwi dollar to jump higher. More>>

BusinessDesk: Lower Fuel Costs Drive Down NZ Producer Input, Output Prices

May 19 - Producer input and output prices fell in the first quarter, mainly reflecting lower fuel costs and weakness in prices of meat and dairy products. More>>


Media: Fairfax Media NZ Announces Senior Editorial Team

Fairfax Media New Zealand has today confirmed its new editorial leadership team, as part of a transformation of its newsrooms aimed at enhancing local and national journalism across digital and print. More>>

Science: Flavonoids Reduce Cold And Cough Risk

Flavonoids reduce cold and cough risk Research from the University of Auckland shows eating flavonoids – found in green tea, apples, blueberries, cocoa, red wine and onions – can significantly reduce the risk of catching colds and coughs. The research, ... More>>

BusinessDesk: RBNZ House Alert Speech The Catalyst For Government Action

Prime Minister John Key all but conceded that pressure from the Reserve Bank of New Zealand for concerted action on rampant Auckland house prices was one of the main catalysts for the government's weekend announcements about tightly ... More>>

BusinessDesk: How To Fall Foul Of The New Housing Tax Rules: Tips From IRD

Just because you rented out your investment property doesn't absolve you from paying tax, says the Inland Revenue Department in a summary of commonly made mistakes by non-professional property investors when it comes to their tax liability.More>>

Legal: Superdiversity Law, Policy And Business Stocktake Announced

Mai Chen, Managing Partner at Chen Palmer New Zealand Public and Employment Law Specialists and Adjunct Professor of Law at the University of Auckland, today announced the establishment ... More>>

Housing: More House Price Gains Expected

House price expectations remain high, with a net 56% of respondents expecting house prices will increase. Fears of higher interest rates are fading, consistent with the RBNZ’s signals this year. Affordability and a lack of houses for ... More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news