A Maori farm trust on the south-western side of Lake Taupo is set to become New Zealand's next cash cow as the North Island's largest sheep milk producer.
The Waituhi Kuratau Farm Trust has morphed from a 2715 hectare sheep and beef station into two unique sheep milk product-based companies in the past seven years, making an impact on the national and Australasian markets.
It presently bags 90 per cent of its annual sheep milk production for export, mainly to the Australian market.
Waituhi Kuratau's sheep milk and yoghurt factory is off Highway 32, on the western route around Lake Taupo. Waituhi Kuratau farms 13,000 ewes and hoggets on its farm.
Trust chairman William Konui, said while Waituhi Kuratau has a nucleus of 4500 milking ewes, 1500 more can be milked if it needs to meet production highs.
The company now freezes most of its milk production, which is sent in bulk to its storage freezer in Tauranga to await export to Australia. The remainder is targeted for its expanding yoghurt production.
While the location is ideal, farming operations around Lake Taupo are now being constrained by the long term effect of leaching nitrate pollution into the lake.
The trust has been able to steer around the effects of the Waikato Regional Council's imposition of a nitrogen cap by its move into sheep milking.
These days, the station provides grazing for nearby farms with cattle in calf for eight weeks on its sheep and beef units, capitalising on WRC nitrate requirements forcing cattle farmers to rest home-based production during this time.
The trust regained possession of the station in the early 1990s after being held by individual landowners for several decades. Within a decade it had increased its income to more than $2 million gross annually, farming sheep and beef.
In 2000 it began a genetic breeding programme from its straight romney breed into east friesian composites, which suit New Zealand conditions, have good lambing percentages, fatten up and milk well.
Mr Konui says the objective was to increase lambing percentages over a five-to-six-year period by 5 per cent a year from below 120 up to 150 per cent.
"We managed to achieved that in three years - the genetics have resulted in a better feed regime and better farm infrastructure."
This season, their lambs scanned at 135 per cent. Mr Konui says this is not as high as they would like.
"But given last season's prolonged drought, we've done well."
The idea of milking sheep was first mooted during a seminar the looked at off-farm investment options, including sheep milking.
The trust instead decided to re- invest all its profits back into the farm to increase production efficiencies through better feeding regimes and boost lambing percentages.
Mr Konui credits his father with coming up with the idea of milking sheep. Nine years ago he was looking at a flock grazing in one of the station paddocks and noticed the large udders on the sheep.
Mr Konui said his father remarked: "Look at the large udders on those sheep, remember what those two sheep milk speakers said about milking? Do we reckon it's worth looking at again? 'And we did."'
The trust began milking sheep in 2005, milking 3000 ewes over five months. The following season 4000 ewes were milked and by last season, 6000 were milked over three months.
This season is expected to run over five months, milking 4000 ewes, with a further 2000 on standby if needed.
Waituhi Kuratau also built an 80-bale split rotary milking plant in 2007, capable of handling 80 sheep at a time, designed its own automatic cup-removers and installed an in- shed feeding system.
As ewes enter a bale, an auto feed system drops 400 grams of grain, palm kernel and molasses to distract them while they are milked.
Mr Konui describes the rotary shed as one of the largest sheep rotary milking sheds with the latest in modern technology.
It has an exceptionally efficient glycol cooling system which quickly cools the milk down to 2 degrees Celsius in the vat, providing a longer lasting quality product for processing.
The season usually runs from October for four or five months, weather permitting. Mating is staggered to spread lambing over four months - ewes with lambs at foot make the best milkers and newborn lambs are left on their mothers for the first month, then weaned off onto grain and hay for another month, before being sold at market. Ewes are generally dried off early to bring them into good condition before being sent to the rams.
The current season's production is "way ahead" of schedule, mainly the result of mild winter conditions, which saved them from the effects of last season's (2012-13) drought. "That's why last season's milking was quite short, due to the condition of the sheep and ability to maintain feeding levels required."
The trust also set about improving the station's infrastructure to better utilise staff and time efficiencies. A seven-kilometre laneway from the woolshed to the milking shed was created, a roading underpass, a bridge upstream of the Mangaaongoki River to limit stock movement on roads, and a reduction of the average paddock size from 15 to 7 hectares.
This had an instant effect in staff utilisation, and time efficiencies.
The bulk of the milk produced is frozen and stored in its storage freezer in Tauranga before it is exported to Australia, which can be reconstituted back to its original condition.
The remainder is targeted for its expanding yoghurt production, supplying Waituhi Kuratau Production Ltd, the sheep milk company set up by the trust early last year.
It also hired independent directors and a decision made to focus on milk supply to local customers and cheesemakers, and export 90 per cent of its production.
In a separate venture eight months later, it established Kuratau Yoghurt in partnership with Waiheke Island Cheese Company owners Kate and Damien (James) Clairmont.
Kuratau started operations in March this year, producing the Hipi (Maori for sheep) yoghurt brand. Within six months, Kuratau is supplying Foodstuffs and is rolling out a new batch of its Hipi yoghurt to New World stores in Auckland and Bay of Plenty stores every week.
The Hipi brand is also sold to a range of top-end Auckland restaurants, delicatessens in Auckland, Hamilton and Wellington.
Mr Konui is keen to see local trusts and incorporations convert to milking sheep in the first instance, however as growth exceeds supply up-take nationwide.
When Waituhi Kurutau reaches production capacity, the company plans to shift its plant to Tokaanu, where they are able to access their owners' geothermal energy resources.
"Sheep milk has great potential and we now need to prove to farmers that this is where the future lies.
"We believe the sheep milk industry is the next great thing in New Zealand."
From a marketing perspective the advantages of sheep milk production is a dream, proving highly diverse in its uses.
Its high solid content allows more cheese to be made per litre, making sheep cheese more economical. Sheep milk produces three to four kilos of cheese from 10 litres of milk, compared with one kilogram of cheese from the equivalent amount of cows milk.
Waituhi Kuratau has set the long term objective to become one of New Zealand's leading functional food companies.
Popularity for the sheep milk product is increasing worldwide - already in high demand in Greece, the Middle East, Asia and America.
Waituhi Kurutau is setting its long-term sights on the international opportunities it believes are waiting.
The trust's directors' philosophy is to phase in expansion gradually, and to put in the hard yards first.
They are being inundated with inquiries for milk and yoghurt products but will not move until they have robust processes and production supply in place.
"We don't want to go too big and fall over in the process, " Mr Konui says.
The company has a bright future and is only one of three enterprises producing nearly the entire output of sheep milk products in New Zealand.
Waituhi's long term projection is to obtain 1 per cent of the New Zealand market share within five years. Current production of yoghurt-associated products in New Zealand is 21,500 tonnes
- © Fairfax NZ News