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New Zealand's infant formula sector is urging its exporters to consider new markets, as China increases its own domestic dairy production.
Exports of New Zealand-made baby and toddler formula are continuing to perform well year-on-year, earning the country $1.1 billion through 2023 to November alone, StatsNZ figures show.
That's up 16 percent on the same period the year before - driven mostly by good prices.
However, in New Zealand's main export market of China, domestic production of its own infant and toddler formula has been growing, while its birth rates hit new lows this year.
The chief executive of trans-Tasman industry group, the Infant Nutrition Council, Jonathan Chew said China has been a sensible market for exporters - despite complex market access.
But he said there were headwinds, and it was advisable not to put all the eggs in one basket.
"Once some brands find success in China, it attracts competition from other producers and the Chinese domestic industry has also been growing, so I think it's sensible for New Zealand manufacturers to consider what else is out there that can present further opportunities," Chew said.
"What we're seeing across Southeast Asia and perhaps India are that there are other potential markets where New Zealand products would be welcome and it's just a question of understanding what the regulatory requirements are, what the food regulation requirements are in those markets and whether that makes it worthwhile for individual manufacturers to pursue."
Chew said the council would be working with its manufacturers to understand the different import requirements and demand in other markets.
He said the need for formula manufacturers to diversify their markets was discussed in a meeting with the Infant Nutrition Council and Minister for Food Safety Andrew Hoggard in Wellington last week - including regulatory hurdles in export markets.