11 Nov 2013

NZ not cheapest place to produce milk - report

3:34 pm on 11 November 2013

A new global dairy report has detailed the spike in milk production costs in New Zealand in the last 12 years.

The International Farm Comparison Network's report tracks milk prices and production costs around the world.

It found that in New Zealand in US dollar terms between the year 2000 and 2012, milk production costs had almost tripled and attributed this to the increase in prices for labour and land, and the appreciating exchange rate.

NZX Agrifax dairy industry analyst Susan Kilsby says the report is full of information that shows what farmers are well aware of - New Zealand is no longer the world's cheapest milk producer.

However, she says the report shows the increased use of concentrated feeds in dairy farming systems and land has risen also as well.

Ms Kilsby says the report also shows that it is still quite expensive to produce milk in China and that is good news for the New Zealand dairy industry.

The farm comparison report says there are 122 million dairy farms in the world and the average herd size is just three animals.