“For most of the 20th century, the white gold our farmers traded in was wool, boosted by related products – mutton, lamb, and so on.
“But in the late 1980s, a market shift changed the face of our economy – and in many ways our landscape – utterly.
“Agricultural subsidies were stripped away from New Zealand farmers,” says journalist Pete McKenzie.
“They were exposed to the competitive pressures of the global market in a way they had never been before.
“At the same time, the price of mutton, the price of wool, of lamb, started to decline.
“One of the few agricultural products that stayed stable or grew was dairy. So thousands  of New Zealand’s farmers made the simple economic choice: they would shift away from the farming practices they’d had until then – largely balanced, but with a bit of a focus on sheep and other products of that sort – to intensified dairy.”

And that was terrible for the rivers and the land and the whole ‘clean-green’ vibe. Not to mention the methane emissions from belching cows, nor that farmers still hold massive debt from the switch to intensive dairy: 40 billion NZ$ (29 million US$).

And now as the planet warms and the oceans rise to meet New Zealand’s dairy-polluted rivers, things are a-changing again.

Given that dairy is going to have to start to de-intensify in New Zealand, farmers may need to switch some of their land to other uses in order to get by.

And that’s where things like growing oats for milk come in. Oat milk is perhaps the least-offensive milk alternative out there, unlike bitter almond milk and weird coconut milk (each to their own!), without the insane water needs (12 litres per almond).

Unsurprisingly, oat milk goes pretty well with porridge (lol).

Chris Wilkie, of Otis Oat Milk, at his rural Martinborough home. PIERS FULLER/STUFF

So, is oat milk one financial way to gradually move away from dairy?

“This is the complicated financial and environmental equation which Aotearoa must solve in order to reach our climate goals: how do we make reducing cattle numbers not only environmentally necessary, but financially possible? Southland is particularly vexed by this challenge. It might also be where an answer can be found, with an eclectic mix of farmers, officials, environmentalists and investors in the region betting on a new product as part of the solution to this climate and financial crisis: oat milk.”

The Southlanders have of course realised that oats are not exactly a cash crop these days:

“While serving in that role, it became clear to Gardyne that there was a significant problem facing both current oat farmers and those wishing to diversify away from industrialised dairy: the price of oats wasn’t high enough. Problematically, the existing oat market – for porridge and baking, among other things – had been met. Growing oat prices would require developing a whole new product. It was in this search for something new that Gardyne came across Chris Wilkie.”

And then…

“Just as Wilkie decided to do something to address intensive dairy farming, his friend Tim Ryan reached out. Ryan had spent years as a globetrotting advertising executive for Nike, but he had recently come home as well. Both Wilkie and Ryan had watched the rise of businesses like Impossible Foods, which was trying to cut American emissions by replacing beef burgers with ones made from plants or lab-grown meat.
“That resonated with me as I looked around the New Zealand countryside,” said Wilkie. “We have the world’s biggest dairy company. So that’s a logical place to focus on.”
“Ryan suggested they create an oat milk company. According to a University of Oxford study, producing a glass of dairy milk consumes at least nine times more land and produces at least three times more greenhouse gas emissions than any plant-based milk. Oat milk is one of the most environmentally friendly plant-based milks. Wilkie enthusiastically signed on and together they founded Otis.”

However, there was a catch:

“But these companies quickly found that their dreams of sustainable oat-based agriculture faced an enormous hurdle. Turning oats into oat milk requires a specialised, large-scale processing plant – something Aotearoa lacks. To create their product, Otis and All Good had to transport most of their oats to Sweden for processing and then import the resulting milk all the way back. (Boring processes its milk in Hawke’s Bay.) That global detour caused their greenhouse gas emissions to balloon beyond what they expected. Their costs have similarly jumped, meaning less of the purchase price goes to oat farmers.
“To connect environmentally conscious producers and consumers – and ensure oat farming was sufficiently viable that dairy farmers could convert to it – an oat milk processing plant in Aotearoa was necessary. Great South stepped up.”

So now there’s a plant under construction in Southland due for 2022-2023 that will be able to produce 40 million litres of oat milk a year. Excellent!

“The shift to plant-based milks also won’t happen overnight. According to Bruce Thorrold, who leads Dairy NZ’s New Systems and Competitiveness team, “growing oats is [still] quite a lot less profitable than milking cows”. He cited internal Dairy NZ figures which suggested that dairy farmers would make around $3000 in profit per hectare, while oat farmers would make just $1500. Over time, the profitability of dairy will be pushed down by costs like the Emission Trading Scheme’s carbon price (in recognition of dairy’s environmental impacts). The price of oats will also have to go up.
“But progress is being made. The construction of a new oat milk processing plant and the emergence of so many new oat milk companies is likely to make oat farming financially viable and help dairy farmers reach the 13 per cent reduction in cattle numbers necessary to achieving climate goals.”

Good stuff, Southland.