Many New Zealand dairy companies are having trouble accessing the Chinese market despite strong demand for Kiwi milk products from China's growing middle class.

Larger companies such as Fonterra have been relatively successful in China but their smaller competitors who are having difficulty. Mahon China Investment managing director, David Mahon, believes that Kiwi firms need to work together to push the New Zealand brand.

'There should be a degree of unity among producers and a unified strategy to tell the country's story. Individually, small players don't have the money or management depth to take the Chinese market on, develop brands and create a story that consumers would relate to, so you get lots of fragmented attempts,' said Mr Mahon.

Doing business in China is also often a new experience for Kiwi traders - irregularities and corruption are commonly reported.

'If you're going to come here with a very inflexible and rigid approach, you're not going to survive. End of story,' an anonymous source told the Waikaito Times.

IExporters need brand new approach to tap Asia
Jazial Crossley, The Waikaito Times, 20 April 2013

Recently released documents show that the New Zealand government directly informed Chinese authorities of their decision to take products containing traces of dicyandiamide (DCD) off the shelf.

The decision was made public in late January, however the traces had been detected way back in September and the time discrepancy led to accusations of a cover up.

The NZ Ministry of Primary Industries wrote directly to food authorities in South East Asia and China but only after the public had been informed.

The letter to the General Administration of Quality Supervision, Inspection and Quarantine in Beijing stated:

'With hindsight we recognise that you would have been better equipped to deal with questions if you had known beforehand. I apologise if our omission inconvenienced you.'

Ministry boss says sorry over residue
Paul Gorman, Business Day, 22 April 2013

Rain has brought a smile to many a New Zealand farmer's face after a drought that is estimated to cost billions of dollars.

The drought has affected the country's North Island since December and has caused milk production to plummet by 20 percent and taken a NZ$1.7 billion bite from farmers, equalling roughly 1 percent of the Kiwi economy.

Dairy Farmer Cory Shearer said his costs include NZ$10,000 lost milk revenue, NZ$5000 spend on extra feed so far and likely NZ$3000 more on feed leading up until winter.

However a deluge of rain has now broken the drought, and has made a 'massive difference', according to Federated Farmers drought spokesperson, Katie Milne.

Despite the rain, things are still looking tough for farmers.

'It will take time to build up enough grass cover to provide feed for winter,' said NZ Minister for Primary Industries, Nathan Guy,'The rain may be falling but the effects of the drought will be felt for some time.'

New Zealand farmers happy as deluge breaks drought
Nick Perry, BloomsbergBusinessweek, 22 April 2013

Drought could cost West Coast millions
Ben Aulakh, The New Zealand Herald, 22 April 2013

A2 Milk Corporation continues to expand and is set to make it's first step into China.

Next month shipments of A2 infant milk formula to China are to begin and will be available in Beijing, Shanghai, Guangzhou, Tianjin and Congqing. This will later be followed by distribution of the product throughout wider Australasia.

China State Farms Holding Company Shanghai is acting as A2's Chinese distributor.

A2 Corporation rolling out first infant milk formula to China, Australasia
Sally Rae, Otago Daily Times, 23 April 2013

New Zealand's Synlait Farms have increased their forecasted earnings and milk price for the current season.

Milk solids are now likely to sell at around NZ$5.80 per kilogram, 40 percent higher than originally forecasted and if so would lead to a revenue of around NZ$31 million.

The expected final milk price is between NZ$6.20 and NZ$6.50 kg per MS, says the company.

Synlait Farms sells milk to Chinese owned processor Synlait Milk.

Dairy price boost for Synlait Farms
Michael Berry, NZFarmer.com, 22 April 2013