Turning bobbies into a billion dollar asset

Non-replacement dairy calves could become much more valuable if a new three year, Government backed industry programme succeeds.

Dairy Beef Opportunities (DBO) is a $20.9 million effort to turn these calves into a stronger revenue stream for New Zealand farmers.

Up to two million surplus calves are estimated to be born on NZ farms each year, many of which are still killed as bobbies despite increasing industry efforts to add value through improved beef genetics.

Over $10 million of funding is coming from government, with economic benefits estimated to be worth $1.25 billion to the economy annually by 2050.

“
Agriculture is the backbone of our economy – a successful sector means thriving communities, growth, secure jobs and a prosperous NZ,” says Agriculture Minister Todd McClay.

“This investment demonstrates our commitment to building the future by delivering practical, on-farm pathways that benefit farmers, processors, and rural communities.

The programme will deliver better integration between dairy and beef systems meaning new and strengthened supply chains, improved profitability, and greater confidence for farmers making breeding and management decisions.

Nathan Guy, independent chair of the Meat Industry Association, highlights the export growth angle.

"Dairy beef opportunities will help lift the value stream for the sector, and this programme creates opportunities for processors and exporters to tap into," he says.

"This is another example of industry and government working together to create better outcomes for the benefit of the wider sector and export returns."

The programme targets three key focus areas.

The first is improving efficiency through genetics and systems by enhancing calf breeding, rearing and finishing to boost productivity, profitability and farmer confidence.

The second is smarter breeding and lactation strategies to increase the proportion of calves entering beef systems while still meeting dairy and beef production needs.

And the third is developing new pathways and value chains by creating innovative products and supply chain solutions for young dairy beef, helping processors manage livestock more efficiently and opening fresh revenue streams for farmers.

DBO is backed by Government funding through the Ministry for Primary Industries Primary Sector Growth Fund.

It is a collaboration between DairyNZ, Beef + Lamb NZ, the Meat Industry Association, Dairy Companies Association of NZ members, and MPI.

Simon Limmer, chair of the DBO Governance Group, emphasises cross-sector benefits.

"The programme will strengthen integration between dairy and beef systems, enhance supply chain efficiency, and open new revenue streams for farmers, helping the pastoral sector continue to drive NZ's economic and primary sector success," he says.

"It will support NZ's reputation for producing premium, sustainable, and ethically raised food, while creating tangible economic benefits for those working in the pastoral sector."

Landcorp Farming, which milks approximately 40,000 cows across more than 40 dairy farms, is among the highest profile NZ businesses working to eliminate bobby calves from its system.

It aims to rear 100 per cent of surplus calves by 2030, and 85 per cent by the end of 2028.

The state owned enterprise expects to rear 72 per cent of non replacement calves born in 2025, up from 66 per cent the year before.

Meantime Daniel Carson, founder of Miti, recently won the Australian Dairy Conference Innovator Award in Melbourne, recognising his company’s work turning surplus NZ dairy calves into a sustainable, high-value protein snack.

This follows earlier wins, like the Early-Stage Innovation Award at Fieldays 2025.