Minister welcomes new sheep milk PGP programme

Primary Industries Minister Nathan Guy has welcomed a new Primary Growth Partnership (PGP) programme announced today aimed at boosting New Zealand’s sheep milk industry.

The new $31.4 million, six-year PGP programme called ‘Sheep – Horizon Three’ is a partnership between Spring Sheep Milk Co. and the Ministry for Primary Industries (MPI).

“This is an exciting and comprehensive programme aimed at boosting New Zealand’s sheep milk industry which has huge potential,” says Mr Guy.

“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.

“There is increasing demand for sheep milk products, particularly in Asia, where many people are intolerant to cow’s milk. We have a massive opportunity to tap into this market, and further position New Zealand as a producer of premium products.

“The programme is expected to generate annual revenues of at least $200 million by 2030 from sheep milk and new, high-value related products like ice-cream. This return could be as high as $700 million if the programme hits its aspirational targets.”

The global sheep milk industry is estimated to be worth $6.5 billion and is growing strongly.

MPI and Spring Sheep Milk Co. are now negotiating a contract so the programme can formally begin later this year. MPI will be investing $12.56 million (40 percent) into the new programme with Spring Sheep Milk Co investing $18.83 million.

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.

About the Primary Growth Partnership

* The PGP aims to boost the value, productivity and profitability of our primary sector through investment between government and industry. It provides an essential springboard to enable New Zealand to stay at the forefront of primary sector innovation.
* Government and industry are co-investing $727 million over time into 21 PGP programmes (2 completed and 19 underway). Once contracted, the new Sheep – Horizon Three PGP programme will add to these figures.
* Decisions on whether or not to approve a programme are made by the Director-General of the Ministry for Primary Industries, under recommendation from the independent Investment Advisory Panel (IAP).
* PGP programmes are generally long-run programmes of five to seven years’ duration and are subject to oversight and monitoring by an independent Investment Advisory Panel and MPI.
* Monitoring requirements include programme steering groups, quarterly progress reporting, annual plans, financial audits, and progress reviews, along with an independent evaluation of the overall programme. Government funding is only released to programmes on receipt of invoices for work completed in accordance with programme plans.
* Overall, the whole PGP is estimated to contribute $6.4 billion to New Zealand’s GDP from 2025, to assist towards reaching the goal of doubling the value of primary sector exports by 2025.

More information is available at: http://www.mpi.govt.nz/funding-and-programmes/primary-growth-partnership/

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