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Sheep milking in New Zealand: An analytical review

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Executive Summary

The subject of my Kellogg Industry Applied Project is a discussion on the advantages and disadvantages for farmers investing in the production of sheep milk.

I have determined there is value in the compilation of a discussion document which identifies the key variables influencing successful commercial sheep milking business. These are current and potential dairy sheep industry dynamics and parameters, market and product opportunities, production cost structure based upon differing capital cost inputs, and the projected returns on investment.

My research is delivered as a discussion document due to the nature of my findings. Through substantial critical thought and analytical processes, I have found there to be many component permutations. This research could be extended into a fully-fledged business plan aimed at attracting investment into a new dairy sheep venture.

The key elements of this report include:

  • Analysis of current industry strength, the identification of possible regional producer groups, and the availability of existing processing opportunities.
  • A comprehensive SWOT analysis.
  • An investigation of the potential supply chain model options both nationally & internationally.
  • An analysis of different sheep milk farming systems placed under different load pressures in order to assess return on investment viability.
  • An assessment of the opportunity to become a market (price) maker (either as an independent producer or collectively with others).
  • Key metrics will include capital expenditure requirements and potential ROIs, with sensitivity analysis to identify the risk and growth pain points.

This topic is of importance to me because it will provide the catalyst to develop an entry-level sheep milking business, capitalising on the intellectual property I have created through the project process. Sheep milking can provide a viable career or business pathway for me and my family. I would like to make a significant contribution to the industry and intend to take a leadership role within it.

Equally, this topic is important to the primary sector because it will provide business growth opportunities for traditional dry stock farmers to diversify, provide pathways for young people to build their careers, support the conservation of rural communities, improved returns for conventional sheep farmers (and others) through an additional income stream, and contributing to the preservation of a traditional pastoral industry.

Sheep Milking in New Zealand: An Analytical Review – Damian Buckley