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Historic Poverty Bay and the East Coast, N.I., N.Z.

Dairy Industry

Dairy Industry

Pioneer Factories Have Uphill Struggle

During the late 1860's the residents of Turanganui (Gisborne) were supplied with milk and butter by Peter McFarlane, who then resided in the township, but who, later, moved to Matawhero. A cheese-house was built on Waikanae in 1873 by Captain Read; it had only a brief career. page 328 Subsequently, J. W. Johnson installed a herd of dairy cows on Maraetaha and supplied the settlers on the Flats with cheese. With T. Caldwell as manager, the Cook County Cheese, Butter and Bacon Company opened a cheese factory in January, 1885, on a property at Matawhero opposite the present (1949) saleyards. Twelve months afterwards the Ormond Cheese, Butter and Bacon Company entered the field. Both companies offered their suppliers only 3½d. per gallon for milk.

In 1892 Townley and Scales took over the Matawhero factory, and appointed William Picken, of Southland, manager. Shortly afterwards Barron Bros, built a small cheese factory at Bushmere. A factory at Waerenga-a-Hika, with J. Candy as manager, followed. Peter Bourke took over the Bushmere factory in 1893, and started the first butter factory in Poverty Bay. The Matawhero factory was burned down in 1898. During that year John Score built a factory at Matawhero, near the Waipaoa River, just beyond the Royal Oak Hotel. He had been guaranteed an adequate supply of butterfat at 6¼d. per lb. for three years. Mr. Picken was his manager. In June, 1901, Mr. Score found that some of his suppliers intended to support T. McGregor (of Taranaki), who was building a factory, which he named Kia Ora, about a mile beyond Makaraka on the road to Ormond, and who had offered them 8½d. per lb. Mr. Score did not reopen his factory. Hair Brothers built a creamery at Lavenham in conjunction with the new factory.

On 13 October, 1902, the Matawhero factory was reopened by a group of producers in the Matawhero-Makaraka area, who had formed the Poverty Bay Co-operative Dairy Company Ltd. Mr. Picken was appointed manager. For this concern 19 November, 1902, was a red-letter day. Over a dozen suppliers turned up with their drays to convey the first consignment to the wharf. At the head of the procession was Andrew Tuohy, who kept on waving his hat and shouting: “This is real co-operation, boys!” Unfortunately for him, his horse, which was not accustomed to walking on planks, backed over the edge of the wharf into the river and was drowned.

Kia Ora Co-operative Dairying Co. Ltd.

In December, 1902, Mr. McGregor sold his Kia Ora factory for £5,000 to a group of dairy farmers, who registered a company under the title The Kia Ora Co-operative Dairying Co. Ltd. Mr. McGregor was retained as manager. The Poverty Bay and Kia Ora companies amalgamated in August, 1904, and the title Kia Ora was preferred. Suppliers were paid 8½d. per lb. for butterfat. In 1904 the company's paid-up capital stood at £771; in 1948 it was £18,000. Production for 1903–4 amounted to 150 tons; the aggregate for 1946–7 was 958 tons, with a pay-out of 22.075d. per lb. of butterfat at the farm gate. In 1923, when the output had risen to 600 tons per season, a new factory, providing for expansion up to 2,000 tons, was built. The record season was 1936–7 (1,779 tons). Cost of manufacture, disposal, etc. (but not including overseas marketing costs) in 1914 was 3.49d. per lb.; in 1924, 2.17d.; in 1934, 1.19d.; and in 1946–7, 1.978d.

Chairmen: W. A. Hood, 1903–4; Julius A. A. Caesar, 1904–5, 1907–10 and 1911–12; E. Knight, 1906–7; A. F. Matthews, 1910–11; G. R. Moore, 1912–35; M. Doyle, 1935—. Managers: T. McGregor, 1903; N. H. Clark, 1904–7; H. R. Newitt, 1907–29; A. P. Lee, 1929–31; W. A. Evans, 1931–38; R. L. Vette, 1938—. Secretaries: T. Alex. Coleman, 1903; A. Graham, 1904–13; H. E. Dodd, 1913–18; R. G. Surrey, part 1918; R. A. Baldrey, 1918–22; J. H. Sunderland, 1922—.

The Okitu Co-operative Dairy Co. Ltd.

In November, 1901, W. Douglas Lysnar placed three herds of cows on Makarori, built a butter factory and a bacon factory at Okitu, and page 329 engaged T. D. Bathgate, of Taieri, as buttermaker. Both factories were destroyed by fire in 1904. A new butter factory, which Mr. Lysnar built in Gisborne, was taken over in October, 1930, by the Okitu Co-operative Dairy Co. Ltd. This company began operations under the handicaps of a small output (80 tons per annum) and an out-of-date plant. By 1936–37 the output had grown to 500 tons per annum. When the State plan for zoning supplies of cream to factories came into force, however, the output fell by half. In 1942 a start was made to develop an important new branch of business—the pasteurisation of milk. At the outset the milk so treated went mainly to schools. By 1947 2,000 gallons of milk were being pasteurised daily, providing, in addition to the needs of the schools, sufficient to supply 98 per cent, of the residents of Gisborne. A plant capable of treating 1,000 gallons per hour was then installed. In addition, the butter output in 1946–47 was 190 tons. Between 1938–39 and 1946–47 the company's turnover rose from £34,000 to £96,000.

Chairmen: E. R. Renner, 1930–38; E. H. Baker, 1938—. Managers: T. D. Bathgate, A. R. Valder, P. A. Armstrong, A. McKenzie, W. McDonald, L. Julian and G. Forbes (1925—). Secretaries: Under Mr. Lysnar's regime, C. J. Hamilton (1901–16); Phil. Hamilton (1916–30); under the company: P. Hamilton (1930—).

Tolaga Co-operative Dairy Co. Ltd.

The Tolaga Bay Co-operative Dairy Co. Ltd. was floated in 1907, but, on account of discontent over the site chosen for the factory, it was but poorly supported and went into voluntary liquidation. It was re-established in 1912 as the Tolaga Co-operative Dairy Co. Ltd. For the first season (1912–13) there were only 25 suppliers, and the output was only 19½ tons. The output stepped up until it reached 315 tons from 118 suppliers. During the Second World War it fell to 200 tons from 70 suppliers. With the rehabilitation of returned soldiers on dairy farms a considerable improvement is anticipated.

Chairmen: E. B. Boland, 1912–14; C. E. Smith, 1915–35; J. P. Guthrie, 1936–38; A. Donald, 1939–47; G. S. Wilson, 1947—. Managers: C. S. Foster, 1912–14; J. Morshead, 1915—. Secretaries: A. Donald, 1912–15; W. F. Morton, 1916–40; E. A. Beer, 1941—.

Ngati-Porou Co-operative Dairy Co. Ltd.

This company's factory is at Ruatoria, and, in regard to ventures predominantly Maori, the basis of financing the undertaking (including buying dairy stock for intending suppliers) was unique. Owners of several valuable leased native blocks borrowed, in all, £14,800 from the Native Trustee and took up preference shares. As suppliers qualified, with deductions from their cream cheques, to take up ordinary shares, a like number of preference shares was cancelled. By 1943 there were no preference shareholdings. Starting off in the 1925–26 season with 58 suppliers, the output was 61 tons of butter. In 1936–37 there were 377 suppliers, and the output was 743½ tons. During the 1945–6 season, when the worst drought in the history of the company was experienced, the number of suppliers fell to 193 and the output was only 256 tons.


On 5 December, 1903, T. McGregor started a butter factory at Motu, but most of the suppliers quickly lost their enthusiasm for dairying. McPhail and de Lautour, who opened a factory in Waimata Valley in January, 1903, had a like experience.

The severe drought during the 1945–46 season greatly reduced butter production in Poverty Bay and adjacent districts. As compared with the average for the previous four years, the Kia Ora Co. suffered a decline of 28 per cent, Tolaga Bay 16 per cent., Okitu 28 per cent., Ngati-Porou 48 per cent., Nuhaka 11 per cent., and Wairoa 20 per cent. The aggregate loss was equivalent to 1,438,490 lbs. of butter.


Peter McFarlane (born in Forfarshire in 1821) migrated to South page 330 Australia in 1849, and came on to New Zealand in 1855. After residing at Nelson and in Otago he settled at Poverty Bay in 1866. He built the Academy of Music in 1879. His death occurred in June, 1900.