Farmers are paid monthly for the milk they supply, based on an estimate of the market price for the products into which it is made. A final payment is made at the end of the season to reflect actual export returns and the processing efficiency of their dairy company. There are currently seven companies located throughout the country, although three companies are responsible for 94 percent of production. This represents a significant change since 1935 when there were over 400 companies, reflecting improvements in transportation and advances in efficient, larger-scale processing technologies. Currently there are proposals for further mergers, including a proposal to merge most of the companies with the New Zealand Dairy Board.
Pastoral agriculture is by far New Zealand's biggest industry.
It uses 13.5m hectares, or 81 percent of all occupied land in New Zealand. Currently there are proposals to deregulate the Board and remove its export monopoly. The Board works with the co-operative dairy companies to ensure that their manufacturing programmes are tuned to meet market opportunities. It also organises shipping, packaging, transport, storage, quality control, market promotion and other support services. The dairy companies are responsible for marketing milk and other dairy products on the domestic market.