DairyNZ has ended the 2023/24 financial year with no debt and flat expenditure as it continues to boost its investment in science and research.
The industry-good organisation recorded a loss of $0.2m after one-off accounting changes were excluded – making it a 93% improvement on the 2022/23 year.
DairyNZ chair Jim van der Poel says reducing costs to combat inflation was a priority this year.
“Cash operating costs were down 1% as we rescoped projects ahead of the implementation of our new strategy in June.
“This blueprint for the future demands a sharper focus on value for levy and on longer term challenges and opportunities for the sector.
“We’ve taken significant steps to reduce our costs amid rising inflation, as farmers have had to do across the past few seasons.
“This has involved reviewing every programme of work and making clear choices around what to continue to keep operating costs down. We’ve cut $1m by ending the ‘Here for the Long Game’ TV campaign, reduced our workforce and introduced a new team structure that amplifies our focus on science, farmer engagement and policy.
“Despite challenging conditions, we continued to increase our investment in science and research, to $39.7 million, to ensure our world-class science and expertise puts the latest technologies in the hands of dairy farmers to support profitability, sustainability and international competitiveness.
“Feedback from farmers helped shape the new strategic direction, which positions us well to progress a positive future for New Zealand dairy farming.”
Across the wider sector, dairy farmers delivered 1,883,234,495kgs of milksolids, up 0.5% on the previous year, despite weather and price pressures.
“Dairy farmers have been producing more milksolids with fewer cows for four of the past five seasons, which is a contribution to be proud of, given how important dairy’s performance is to the New Zealand economy, and also rural communities,” says Jim.
Outlook
Since 2013, DairyNZ’s revenue has remained relatively stable. Reduced commercial and co-funding income has been compensated for by increased milk production and levy income which has now plateaued. The levy rate has remained unchanged at 3.6 cents kg/ms since DairyNZ was established over 15 years ago.
“For the coming year we expect our income to remain flat, and so we will manage expenditure tightly and use cash reserves once again to deliver on our committed programmes.
“DairyNZ has made tough decisions to reduce costs, taken on feedback, and set up the organisation to better meet the needs of dairy farmers into the future,” says Jim.
Media contact
Kelly Spring
Corporate Communications and Media Manager
p: 027 548 9741
e: kelly.spring@dairynz.co.nz