But a dairy industry leader says the company may have trouble recruiting the farmers it needs, despite it paying more than other dairy co-operatives.
Mataura Valley Milk chief executive Bernard May said the company was seeking to increase its milk supply by up to 40 million litres during the next two years, and most of the increase was likely to occur in the coming season.
“The target reflects our capacity for increased production and the commitments we have with customers who value the quality of our a1 protein free milk and nutritional products.”
The company is building an a1 protein free milk supply to help its growth as a dairy based nutritional facility. a2 milk comes from cows that naturally produce only a2 protein in their milk, and not a1 protein, he said.
Mataura Valley Milk produces a range of nutritional products for export, particularly to China.
It has not expanded its site to deal with the additional production, but does plan to expand its laboratory.
“Despite some challenges with Covid-19 restrictions, recruitment is progressing well, and we continue to attract and develop talent in the Southland region,’’ May said.
Mataura Valley Milk’s financial statements for the year ended December 2020 say the company aims to pay its shareholder farmers the best regional farm gate milk price, targeting a 20 cents per kg milksolids price premium above the local competition. The final milk price is a seasonal average, with the supply season being from June 1 to May 31.
Southland Federated Farmers sharemilkers section chairman Jason Herrick said he didn’t believe there was the capacity in the eastern Southland area for Mataura Valley to recruit as many as 16 more milk suppliers.
“There are waiting lists at some other places to get on board, so I think they may struggle a bit. The fact that they’re paying more is definitely an incentive for high equity farmers who might want to take their shareholding out of wherever they are and pay down some debt,’’ Herrick said.
“There’s a lot of uncertainty out there at the moment, there’s talk from the Government about reducing herd numbers, and the price of fertiliser has gone through the roof – it’s up to individual farmers of course but I think they’re being quite cautious at the moment.’’
Farmers would already know whether their herds produced a2 milk, he said.
The company, which is a joint venture between The a2 Milk Company (75 per cent) and China Animal Husbandry Group (25 per cent), is based at McNab near Gore, and opened in 2018.
The a2 Milk Company took a 75 per cent stake in Mataura Valley Milk in August 2021, for $268.5 million.
