Kaimai Cheese Company has closed its production facility and cafe at Te Mata near Havelock North and the company is ceasing all South Island and export sales.
In a letter to shareholders, chairman Wyatt Creech says while Kaimai, set up at Waharoa in the Waikato in 2005, had a high sales growth rate, the rise in costs including milk, were 'forever eroding” the gross margin in the specialty cheese sector for all competitors.

Kaimai Cheese maker Jason Trevelyan.

Six staff at the Te Mata plant have lost their jobs and two at the Waharoa dairy factory and cafe, including general manager Sheryn Cook. More redundancies are possible.
Wyatt says production tonnage doubled last year to meet orders, however, manufacturers like Kaimai, which buy milk from Fonterra, do not know the price of that milk until the end of Fonterra's season.
He says milk prices during the last year had leapt, which meant the company had made 'incorrect assumptions” about the milk price when entering retail contracts.
The effect of the milk price rise on the bottomline had been 'material”.
He says Kaimai will become an artisan $4.5m business with a materially larger portion of its customers in Waikato and Auckland.
The cheese company won medals at the Cuisine New Zealand Champions of Cheese Awards this year, including a silver medal for their bocconcini in the Langham Champion Fresh Unripened Cheese category.
Cheese maker Jason Trevelyan says it was great to improve on their bronze medal from last year.
'It shows we've maintained what we've been doing and adding value to it,” says Jason.
'It's not an easy product to make, but we've had a few Italians say that they are impressed with what we've come up with – and to have it so fresh.”
A popular cheese in Italy – the Kaimai recipe differs because of the taste of New Zealand milk says Jason.
It is made with whole cows milk and is made in a machine which caters for 2000 litres of milk – which converts the milk into half a tonne of bocconcini.
If differs to mozzarella in taste because there is no salt.
'That's why it has a limited shelf life of 35 days. It's quite a subtle, mild taste – it has a really unique flavour to it. It is not a heavy product like feta.”
A good bocconcini should be able to stretch out to a full arm's width without breaking.
'What you can expect to find with bocconcini is that you can peel it – it has a kind of chicken-like texture,” say Jason.
'It's breakable. It's stretched and pulled like Mozzarella, then made into little balls.
'I think people are expanding and developing their culinary outlook and are looking for good quality products that aren't mass produced.”