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Executive Summary
A record 22.01 million metric tons (MMT) of milk was harvested from 4.99 million cows during 2018
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in New Zealand; up two percent from 2017. Plentiful rain over most of the country, especially in the
first half of 2018 stimulated high pasture growth. From August to December 2018, weather conditions
were temperate across the country, which resulted in higher pasture growth compared to the previous
two years, particularly in the North Island. This combination of good weather conditions is the primary
reason behind the increased milk supply.
Total milk supply for 2019 is forecast at 21.77 MMT, down one percent from 2018. Improved milk
prices are expected to give farmers the confidence to purchase extra supplementary feed in the event of
short-term pasture growth deficits.
Post estimates 2018 total dairy production at 3.21 MMT, a two percent increase from 2017 and in line
with the increase in milk supply. Anticipated demand for whole milk powder (WMP) is expected to
fuel higher production with a 60,000 metric ton (MT) increase, a four percent increase from 2017.
Looking ahead to 2019, total dairy production is forecast at 3.21 MMT, a marginal decrease of 0.2
percent. The reduction in the milk supply is likely to mean WMP will be reduced by 30,000 MT, but
this will be offset by an expected 23,000 MT increase in infant milk formula production.
Dairy exports were forecast to be on an upward trend between 2017 through 2019 and this continues to
play out. For 2018, total exports are forecast at 3.24 MMT, up 0.7 percent from 2017, followed by an
anticipated six percent increase in 2019 to reach 3.45 MMT. WMP exports were up 27,000 MT to reach
1.37 MMT in 2018 and they are expected to rise to 1.42 MMT in 2019. Other dairy categories that are
likely to increase include: a) Infant milk formula (IMF) exports up 29 percent in 2018 and a further 24
percent in 2019; b) skim milk powder exports estimated up 18 percent in 2019; and c) total cheese
exports are forecast to increase by nine percent in 2019.
Dairy imports into New Zealand totaled US$298 million (m) in 2018, a 12 percent increase from 2017.
The main import by weight has been lactose from the United States and the European Union (E.U.)
1/ Note: The GAIN Dairy Marketing Year (MY) is the same as the calendar year (CY), January 1 to December 31.