Chile – Manuka Dairy Farm owned by New Zealanders – One of the largest in South America

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Manuka S.A, has established itself as a significant foreign investor in Chile’s dairy industry, is owned by 140 Kiwi investors, of which five of the cornerstone investing families own 70%.

Juan-Carlos-PetersenJuan Carlos Petersen, ex chief executive of Manuka S.A, has said the principles of grass-based dairy farming in Chile were the same as in NZ but the genetic lines were not there yet and it was still building Kiwi cross breeds in its herds.

Dairying is strong in the lakes district of Los Lagos, where the physical similarities with NZ are uncanny, even down to the Mt Taranaki look-alike Osorno volcano, which forms a backdrop to the port city of Puerto Mont.

With a population of 17 million Chile sees itself as small, like NZ. But in contrast, 85% of its dairy production is for domestic consumption and growth in local demand is outstripping production growth.

Manuka had adopted NZ’s approach to sustainable and environmentally responsible growth and Petersen said its standards were similar to NZ’s. For example, all waterways on Manuka farms were fenced and effluent was caught and used.

Manuka had made its biggest advances through improved farming skills, which he attributed partly to the number of trainees sent to NZ to work and study.

“Human capital has been the main driver for the growth of the company,” he said. The changes in productivity from the old traditional Chilean system are most impressive. Under the old system, the cost of labour was about 6 cent (US) per litre produced. The New Zealander’s target is to have it at 2 cent/litre.

It employs around 350 staff, producing 110 million litres of milk from 37 farms over 22,500 hectares with only a third of the land being fully developed. Manuka is Chile’s biggest milk producer. The target is to reach 43,000 cows producing 220m to 240m litres annually on the present land-holding .

Speaking at the Dairy Innovators Forum, one of four company directors, Arthur Bryan put their success down to a strong management team and structure and positive human resource environment.

With the world population forecast to increase 50pc by 2050, Mr Bryan said the relationship between food, fossil fuels and water would become more important.

“Grain is used in 90pc of milk produced in the world and one of the attractions of Chile was that we didn’t need to put as much grain in,” Mr Bryan said.

Sadly in more recent times the company has been associated with some of the worst animal cruelity charges in Chilean history with a New Zealander Zach Ward the production manager for Manuka  still wanted by Chilean authorites for a range of serious charges related to his earlier management. He is reportly hiding out in New Zealand to avoid extradition.

It is alleged Manuka slaughtered around 6000 bobby calves that were getting in the way of their milk production process.  allegedly making its employees kill thousands of calves by starving and beating them to death with steel bars. This is highly illegal in Chile which has very high standards of animal treatment.

Contact the Gateway to South America team to learn about the best investment opportunities in the region. The company is a benchmark for foreign investors wishing to invest in Argentina, Brazil, Chile, Paraguay, Peru and Uruguay, providing expert advice on property acquisition and investment tours.

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