New Zealand's fledgling sheep milk industry has received a significant boost with approval of the business case for a new Primary Growth Partnership programme between the Ministry for Primary Industries and Spring Sheep Milk Co.

Spring Sheep Milk Co's sheep milk powder. Image: Supplied

The new ‘Sheep – Horizon Three' PGP programme aims to develop a market driven, end-to-end value chain generating annual revenues of between $200 million and $700 million by 2030.

MPI will be investing $12.56 million (40 per cent) into the new programme with Spring Sheep Milk Co investing $18.83 million, representing a total investment of $31.39m over its six year life.

Spring Sheep Milk Co Chief Executive Scottie Chapman says with PGP support, sheep milk represents a unique opportunity for New Zealand to build a high-value sheep milk industry. Spring Sheep Milk Co is a 50/50 partnership between Landcorp and a number of New Zealand investors through SLC Ventures LP.

'Internationally, there is significant and growing demand for sheep milk, especially from Asia, where consumers like its nutritional value, flavour and digestibility. With the right approach, New Zealand is in an ideal position to develop the sheep milk products to meet this demand. Our PGP programme with MPI allows us to do that in a planned and systematic way so we create a high-value, sustainable industry from the get-go,” says Scottie.

'Establishing an end to end value chain will ensure that these returns are generated, and retained in New Zealand at every stage – on farm, through processing and then into marketing.”

The Sheep – Horizon Three PGP programme provides real opportunity for those people already involved in sheep milking, and those who want to enter the industry.

'To achieve a sheep milk industry delivering domestic and export returns at the upper range of $700 million, New Zealand will need up to 55 farms managed by farmers with specific sheep milking expertise. The current farming model in New Zealand won't achieve this, which is why this joint investment between ourselves and MPI is so critical.”

Spring Sheep Milk Co currently operates one farm of around 4000 East Friesian sheep near Taupo.

Primary Industries Minister Nathan Guy has welcomed the programme. 'This is an exciting and comprehensive programme aimed at boosting New Zealand's sheep milk industry which has huge potential.

'It will involve new genetics, new farming systems and developing high premium niche products. New Zealand operators will be involved in all parts of the value chain.”

As part of the contracting process MPI and Spring Sheep will agree how other sheep dairy operators will be able to benefit from the programme, including the supply of milk to Spring Sheep and open access to improved dairy sheep genetics and knowledge.

'Through the Sheep – Horizon Three PGP programme, Spring Sheep Milk Co will be able to help drive sustainable industry growth by investing in a number of important areas,” says MPI Director-General Martyn Dunne.

'This includes market intelligence to guide a programme of high-value product development and establishing a research farm to increase the genetic merit of the sheep. It also includes developing farming and environmental systems, and building the right capability and skills required for successful sheep milk farming in New Zealand.

'We're very excited about the benefits the Sheep – Horizon Three PGP programme will bring for our wider sheep milk industry and the high value products it aims to deliver for consumers in New Zealand and overseas.”

Scottie says the Sheep – Horizon Three PGP programme will establish another important industry that will provide a real economic boost for New Zealand that is environmentally and socially sustainable.

'We're pleased MPI shares our vision for ensuring from the outset that New Zealand's sheep milk industry has the right structures and processes to achieve the highest value returns through demand-driven growth, high value product development, best practice farming systems and high performance dairy sheep.”

MPI and Spring Sheep Milk Co are now negotiating a contract so the programme can formally begin.