Rising global demand for organic dairy products is prompting New Zealand dairy cooperative Fonterra to expand its organic operations. From the 2028/29 season, organic milk will also be processed on the South Island.
In recent years, Fonterra has seen solid growth in its organic business and is now opening recruitment for organic suppliers on New Zealand’s South Island. This expands the existing Organic Programme, which currently includes more than 100 organic farms, primarily located on the North Island.
According to Fonterra, the decision is driven by sustained global demand for organic dairy products and a desire to increase overall processing capacity. The plan is for organic milk to be processed at the company’s Stirling site from the 2028/29 season onwards.
The expansion is intended to provide South Island farmers with a new supply option while also strengthening Fonterra’s overall earnings. Organic production is still considered to make a positive contribution to the cooperative’s financial performance, including for conventional suppliers.
Support package for interested farmers
Fonterra is also offering support to farmers interested in converting to organic production, including advisory services, networking opportunities and financial incentives during the conversion period.
Since the introduction of a dedicated organic milk price in the 2016/17 season, organic suppliers have, on average, received a significant price premium. Recent seasons have seen record-high organic milk prices, and the current forecast for 2025/26 indicates that prices will remain at a high level.
