Fonterra's rural services subsidiary, RD1, expects to have regular shipments of palm kernel extract going directly into Southland, following its first delivery through the Port of Bluff last week.
RD1 is one of several suppliers importing palm kernel expeller (PKE) from Malaysia and Indonesia as a supplementary source of protein for dairy cows.
The extract is the by-product of palm oil processing and, despite some biosecurity concerns, has found favour with many New Zealand dairy farmers, who began using it during the 2008 drought to help offset feed shortages.
Until now, RD1 has been sending the palm kernel southwards by road from Timaru.
RD1 Nutrition operations manager Mike Borrie says importing it directly through Bluff, as others are doing, will allow it to provide the product at a lower and more competitive cost to meet the growing demand in Southland.