Brook Report: A drop (of milk) in the bucket

A 2010 NZIER study estimated that New Zealand’s dairy sector contributed 2.8% to GDP, which is the equivalent to $5 billion.

While this may not sound that impressive, in context it is greater than the GDP contributions of the fishing, forestry and mining sectors combined, and 10 times the size of New Zealand’s horticultural sector.

New Zealand’s biggest player in the dairy sector is Fonterra Co-operative Group, which generates around $10 billion of export receipts annually, equivalent to one in every four export dollars. Around 75% of this is returned to farmers by way of milk payments, but approximately $1.5 billion is injected back into the economy through salaries, wages and returns to other stakeholders.

The NZIER estimates that the dairy sector may account for as many as 45,000 jobs, directly and indirectly, for an untold amount.