Imported Butter Arrives in New Zealand to Boost Shelf Competition
American butter, sold at a lower price than New Zealand's own product on supermarket shelves, appears to be an example of the market functioning as it should, according to the Dairy Companies Association of New Zealand (DCANZ).
American butter was purchased in bulk by Synlait's subsidiary — Dairyworks — and packaged in Christchurch under the "Burtfields Co" brand. It is sold through Pak'n'Save supermarkets, part of the Foodstuffs network: initially on the North Island and now also on the South Island.
500g blocks were initially sold for $6.99; the next cheapest option reportedly was Pams butter at $7.19.
DCANZ Executive Director Kimberly Crewther said that DCANZ supports free trade, so consumers worldwide should have the option to choose New Zealand dairy products, and New Zealanders should have access to products made in other countries.
She stated that this reflects New Zealand's low import tariffs and the global dynamics of supply and demand.
Crewther noted that New Zealand is recognized as a producer of very high-quality dairy products, and its butter is valued worldwide for its premium qualities.
"New Zealand butter is sold at a premium over American butter in global markets," she told Dairy News.
"Considering this, along with the calls for cheaper butter options in the New Zealand retail market, the import of American butter to New Zealand looks like a case of markets functioning as they should.
New Zealand farmers will continue to receive market returns that reflect the quality and premium value of their products, and New Zealand consumers will benefit from an expanded choice."
As a subsidiary of Synlait dealing with consumer brands, Dairyworks sells its own New Zealand-made butter, cheese, and milk under the Dairyworks, Alpine, and Rolling Meadow brands.
Dairyworks General Manager of Sales Mark Simpson said the company had the opportunity to bring butter from the US at a lower price during a time when butter consumption was under pressure: people were buying less based simply on shelf price.
"So we looked at what options we had to help in this situation."
Simpson did not disclose details about the American supplier or the volumes of imported butter but noted it was "a volume for about a couple of months," depending on consumer demand.
500g blocks were initially sold for $6.99; the next cheapest option reportedly was Pams butter at $7.19.
DCANZ Executive Director Kimberly Crewther said that DCANZ supports free trade, so consumers worldwide should have the option to choose New Zealand dairy products, and New Zealanders should have access to products made in other countries.
She stated that this reflects New Zealand's low import tariffs and the global dynamics of supply and demand.
"New Zealand butter is sold at a premium over American butter in global markets," she told Dairy News.
"Considering this, along with the calls for cheaper butter options in the New Zealand retail market, the import of American butter to New Zealand looks like a case of markets functioning as they should.
New Zealand farmers will continue to receive market returns that reflect the quality and premium value of their products, and New Zealand consumers will benefit from an expanded choice."
As a subsidiary of Synlait dealing with consumer brands, Dairyworks sells its own New Zealand-made butter, cheese, and milk under the Dairyworks, Alpine, and Rolling Meadow brands.
Dairyworks General Manager of Sales Mark Simpson said the company had the opportunity to bring butter from the US at a lower price during a time when butter consumption was under pressure: people were buying less based simply on shelf price.
"So we looked at what options we had to help in this situation."
Simpson did not disclose details about the American supplier or the volumes of imported butter but noted it was "a volume for about a couple of months," depending on consumer demand.
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