New Zealand's Economy
Dairy and Fonterra
How New Zealand became the world's largest dairy exporter, the farmer-owned cooperative Fonterra formed in 2001, and the environmental costs of intensive dairying.
New Zealand is the world’s largest dairy exporter.
Fonterra
- Formed in 2001 by merging cooperatives.
- Owned by farmers.
- Handles most of New Zealand’s milk.
Exports
Milk powder, butter and cheese go mainly to China and Asia.
Global Dairy Trade
Fonterra’s online auctions set benchmark dairy prices.
Grass-fed
Cows graze outdoors on pasture year-round, keeping costs low.
Environmental costs
- Water pollution from nitrogen runoff.
- Methane emissions: agriculture is a large share of New Zealand’s emissions.
2008 scandal
Fonterra part-owned Sanlu, the Chinese firm at the centre of the melamine milk scandal.
The milk auction
Dairy farmers watch the fortnightly Global Dairy Trade auction, since prices set their income.
Thinking New Zealand's dairy goes mainly to local shops
Most is exported.
Key takeaways
- New Zealand is the largest dairy exporter.
- Fonterra is farmer-owned, formed in 2001.
- China is a key market.
- Dairying causes water pollution and methane.
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