A big, new Waikato butter factory isn't expected to cut prices
Photo:
Sorin Gheorghita for Unsplash
The country's newest butter plant is not expected to lower soaring prices at the supermarket checkout.
Open Country Dairy is spreading into the butter market, with the new plant in Matamata on track to open in two months' time.
The country's second largest milk processor will export its product to North America, Japan, South East Asia, the Middle East, the UK and Europe.
Chief executive Mark de Lautour said around 20,000 tonnes of butter each year will be sold to the global market.
"We're selling it globally and that's where the best returns are rather than the domestic market," he said.
"Globally there is huge demand and huge value put on natural fats around the world at the moment."
He said while it's unfortunate consumers locally are paying the high global price, there is a spin off for the country's trade.
"The good thing is that export earnings for New Zealand are increasing because of it."
Open Country's new plant is located at its Waharoa site beside its existing cheese factory.
Half of the butter produced will be in small retail packets and the other half will be bulk 25kg cartons for commercial use.
"The plant is commissioning now and we're looking to make our first commercial butter this week really from the plant," he said.
"The official opening is going to be in a couple of of months when everything is settled.
"There's a large number of people in white clothing running around learning to use the new equipment."
The downstream impact of the capital investment will also see new jobs in the cool store and on the distribution side of the supply chain.
Stats NZ showed a 500 gram block of butter now costs $8.60, up 46 percent in just the past year.
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