Colin Williscroft, Rural Reporter
New Lincoln research has suggested that dairy sheep are a better prospect than cows to fulfilling the green credentials New Zealand uses to differentiate its produce in the global market.
However, is that likely to become a reality? Will dairy sheep ever challenge dairy cows as an industry in New Zealand?
Senior lecturer in agribusiness management at Lincoln Dr Nic Lees co-authored the paper “Competitive advantage through responsible innovation in the New Zealand sheep dairy industry”.
It found, rather than competing on cost, the sheep dairy industry should promote sustainability and environmental benefits, and be innovative.
“Future environmental constraints make milking sheep a more sustainable option than milking cows in New Zealand,” Lees said, pointing to the fact that sheep do not have the same nitrogen leaching effect as cows because they have a lower volume of urine. Sheep milk also had health benefits, Lees said.
It has three-times higher whey content compared to cow milk, which aids digestion. It also has higher calcium and higher vitamin D levels, which aid the regulation of phosphorous and calcium absorption essential for bone mineralisation.
He said sheep milk also contains different forms of proteins that are unlike the beta-lactoglobulin and alpha S1 casein in cow milk that commonly cause milk allergies and intolerance.
There is an opportunity to build on the positive perception of low intensity, pasture-based production systems, Lees said.
“By emphasising these attributes in marketing, sheep dairy products could obtain market advantage and could potentially gain higher product premiums. At the same time, this would help meet the requirement from stakeholders for environmentally sustainable agricultural production.
“Furthermore, consumers are increasingly looking for foods that align with their personal values, such as environmental sustainability, animal welfare, fair trade and organic production. The industry has the potential to see this not as a compliance cost but as a way to provide a valuable competitive advantage.”
He said it could invest in developing new innovations such as superior sheep milk products for niche sectors like health, infant care and gourmet food. It has a much creamier flavour than cows’ milk, due to its higher fat content.
It is estimated that the demand for sheep milk is growing by 10 to 20 per cent each year and New Zealand’s largest sheep dairy operation, Blue River Dairy in Southland, has seen a 50 per cent increase in the milk powder price over the past three years.
Since that paper was published Lees said there had been some interest in its findings from the media in New Zealand and Australia, probably because the environment is such a hot topic, but little or nothing from the dairy industry itself, which did not surprise him.
“People are intrigued by the idea of sheep milk but most people in New Zealand know very little about it and probably think it is very similar to goat’s milk, which it isn’t really.
“That’s not the case worldwide, in places like Greece it’s quite common to drink milk from sheep.”
Lees would be surprised if any dairy cow farmers in New Zealand would ever consider change to milking sheep.
“Sheep are quite a different animal.”
With irrigation schemes bringing a reliable, on-tap water supply to South Island paddocks that have not had that luxury before, there are new opportunities for dairy sheep numbers to grow, Lees said, adding that if land uses in those areas are to justify the cost of accessing that water, farmers will need a high value product to justify that cost.
“Sheep milk will provide a viable alternative.
“It will give sheep and beef farmers an alternative source of income. It stacks up pretty well financially.”
Earlier this year dairy sheep numbers in New Zealand were estimated at just over 30,000, milking for around 16 producers, according to figures released by AgResearch.
Lees said that, given time, that number could rise to around the million mark.
He said one of the advantages dairy sheep have over cows is the price paid for sheep milk. At around $2 a litre it can be viewed as a high value product, although that’s offset by volume, as production from sheep is much less than cows.
Although the jury is out on just how much of a market there is in New Zealand for sheep milk, the potential for exports cannot be ignored.
For people in Asia, sheep milk is a known commodity and one that is embraced for a variety of reasons, Lees said, and there is significant potential in the market there for infant formula.
Sheep milk is more closely aligned in its profile to human breast milk, he said, while people who have intolerances to cow’s milk are more likely to tolerate sheep milk.
However, as with any small or developing industry, it’s going to take someone to throw a bit of money at it to take it to the next stage.
“From where I see the market, it’s going to require a number of large operators to set up a sheep milk powder plant to enable the increased production of sheep milk infant formula for export.
“One of the challenges we face in Canterbury is that we don’t have a sheep milk processor, so people are reluctant to expand into sheep dairy.
“No one has invested in a milk powder drier. We’re caught between a rock and a hard place because potential investors don’t want to invest that sort of money until they see a secure supply.”
He said for the industry to go to the next level it needs someone with relatively big pockets to believe in the export market and to put their money behind it Darfield dairy sheep farmers Guy and Sue Trafford only began milking sheep in Canterbury relatively recently, but they knew of their potential much earlier, having come across them when they were managing a large Maori trust farming operation near Gisborne around 2001.
That was about the time respected animal geneticist and former AgResearch director Jock Allison got behind the east Friesian milking breed and the Traffords’ employers at the ‘time decided to give the breed a go. It was an experiment that didn’t work out for a number of reasons – but it did trigger an interest.
Today many of the problems they encountered from those early days are gone, with cross-breeding and better management making east Friesians a far better option in New Zealand conditions.
So when, after deciding to get out of Christchurch and moving to the Darfield area following the 2010 earthquake, the Lincoln University lecturers decided to take up the challenge of dairy sheep.
After initially buying about nine hectares they now have access to just under 40, thanks to leases and friendly neighbours.
They run about 200 ewes, mainly east Friesians crossed with awassi, a breed that originated in the Middle East. The ewes are milked once a day for about 200 days a year.
It’s been anything but easy going since they started, and the couple are glad they didn’t give up their day jobs but maybe, just maybe, there’s light at the end of a long and sometimes narrowing tunnel.
When they made the move into dairy sheep it wasn’t about becoming pastoral farmers, Sue said.
It was more about creating a food business and with any luck there was the possibility of doing the hard yards for a possible future Canterbury niche industry.
“It’s a bit of a research project as well as a commercial business.”
The initial plan was to provide milk for ice cream and early on it seemed Deep South Ice Cream were on-board.
However, for one reason or another that deal failed to materialise so the Traffords were left scrambling for contracts to sell their milk.
Fortunately, a local cheesemaker came to the party, which helped get them through to the next challenge. Compliance.
“The biggest horror we’ve had to face is compliance,” Guy said. “It just seems so random. The people at MPI (Ministry for Primary Industries) are great but the system itself is a different story.”
As there are not too many involved with dairy sheep in Canterbury, getting up and running has involved a bit of trial and error, Guy said. “We’ve learnt a few things on the way.”
They bought their milking plant from a former goat farmer, while their pasteuriser was imported from Greece.
To have a bit more control over the business from pasture to bottle (or plate, as ice cream is still on the menu, down the track), they are now setting up their own milk processing plant, which, when it’s up and running, will mean the Traffords will be able to take milk from other farmers in the area with dairy sheep.
However, like their Lincoln colleague Lees, they realise that for the industry overall to go to the next level a major player will need to come in.
Guy said it would cost around $55 million to build a new milk drier for Canterbury, and no one is going to do that until they have a security of supply to pay for it.
Blue River Dairy’s drier in Southland is too far away, although the Invercargill company is showing the industry the future in other ways. Initially Blue River only produced sheep milk feta cheese but today it’s expanded into more cheeses, ice cream and milk powder.
It has evolved into an export-focused infant nutrition business and only last month it achieved registration with the China Food and Drug Administration to register its brands of infant formula there, something that will be required to export into China from the beginning of next year.
It was an important achievement and one the company is rightly proud of.
However, for the rest of the industry there is still much to achieve.
There is, it seems, plenty of room to expand, if it can attract more investment.