Miraka Milk Processing

June 2015

Maori owned milk company Miraka has a geo-thermal powered plant including a UHT facility

From small beginners on a paddock in farmland north of Taupo, Miraka (the Māori word for milk) has developed a new milk drying and UHT facility that is now in its fourth season of production. It cost $90 million to build and opened in 2011. It was profitable from the very stary.

Miraka is owned by a group of Maori trusts and incorporations, along with New Zealand sales and marketing broker Global Dairy Network. A 19 per cent stake is held by Vietnam’s Vinamilk, who is also a customer.  Of the 10 Maori shareholder entities, six have farms which between them milk 20,000 cows.

Miraka is powered by geothermal energy bought at commercial rates from a plant next door owned by shareholder the Tuaropaki Trust.

The company pays its suppliers 10c per kilogram of milk solids more than Fonterra pays. Its farmers do not need to buy shares to supply Miraka,

Miraka is supplied by a total of around 50,000 cows. Other Maori trusts are knocking on Miraka’s door and it has a waiting list of potential suppliers but no capacity to take them right now. It’s a far cry from Miraka’s first season when the big fear was getting enough milk supply from the 80km radius collection area it had nominated to run the plant efficiently.

The new UHT or long-life milk plant, which started up in January 2014, will be able process around 60 million litres a year. The plant was built a year ahead of the business plan and took the total payroll to 78 people.

The major buyer of the UHT is the Chinese company Shanghai Pengxin, purchaser of the central North Island Crafar Farms Estate and aspiring buyer of Canterbury’s Synlait Farms.

Part of Miraka’s business strategy is to have a cornerstone customer for each step of its growth. The company exports to around 20 countries, including China and Vietnam.

The Miraka board already have their growth strategy for the next five to 10 years in place. On their radar is commercialisation, hopefully in the next three years, of a Primary Growth Partnership milk proteins development project. Parties to this $3.5 million investment programme include the Kanematsu Trading Company of Japan and major Miraka shareholder Wairarapa Moana Incorporation. The plan is to make the export milk proteins at Miraka.

When Kingi Smiler was awarded the Agribusiness Person of the Year by Federated Farmers, it was said his greatest accomplishment to date was to pull together the support base and drive the establishment of Miraka Limited, the largest collaborative new venture undertaken in the Maori agrarian sector, indeed the entire Maori economy over the past five years.

Miraka’s state-of-the-art milk powder production facility, which draws on geothermal energy, is based at Mokai northwest of Taupo. It cost $90 million to build and opened in 2011, achieving profitability in year one.

Kingi is chair of the Board of Miraka, and is also chair of Wairarapa Moana Incorporation, who with Tuaropaki Trust are the cornerstone shareholders of Miraka. WMI manages 12 dairy units and operates 10,000 cows which produce 4 million kgs of milk solids a year and is the biggest single supplier to Miraka.

Miraka has been the culmination of more than 10 years effort on Kingi’s behalf to lift the performance of the Maori agri-business sector. He has taken a key leadership role in this, fronting a series of initiatives like the Tairawhiti Land Development Trust which combined with the Ahuwhenua Trophy for Maori Excellence in Farming Competition have seen the sector make some significant economic gains. The Ahuwhenua Trophy Competition is now considered the premier calendar event in the sector.

CEO Richard Wyeth has led the Miraka team from the initial beginnings as a greenfields development. He says it has been an exciting and stimulating challenge to be with the company before any of the infrastructure was in place.

Richard is from a sheep and beef farming family in the Wairarapa. He was with Open Country Dairy and Open Country Cheese before joining Miraka. He’s overseen the transition from a development project to a fully functioning and highly successful business.

Miraka recently won the He kai kei aku ringa for Māori Excellence in Export award, supported by The Ministry of Business, Innovation and Employment (MBIE), Te Puni Kōkiri, and The Treasury, in the 2015 New Zealand International Business Awards.