What is the different between premium Anchor and value brand Dairy Dale?

Craig Prichard remembers when milk tasted very different from region to region.

"Milk in Taranaki where I grew up was different to the milk in Napier," Prichard said.

The Massey associate professor, and sheep milk specialist, said things like climate, pasture and production methods used to greatly change the taste profile and characteristics of milk.

"That's largely disappeared."

READ MORE: Fonterra units fall to three-year low following downgraded forecast

Milk was now "deconstructed" and put together in a homogenous way by New Zealand dairy cooperative Fonterra - the world's largest dairy exporter.

Fonterra, which collects about 22 billion litres of milk in New Zealand every year, has a huge influence on our perception of milk, he said.

DAVID UNWIN/STUFF Massey University agriculture research expert Craig Prichard says most people buy milk based on convenience and price.

"Fonterra largely owns the New Zealand palate when it comes to milk."

Fonterra collects 82 per cent of New Zealand's milk, meaning there's a very high chance the milk you poured on your cereal went through a Fonterra factory at some point.

Anchor is Fonterra's best known milk brand, with generations of Kiwis having grown up on it.

Budget brand Dairy Dale is a Fonterra brand and Select, Cow & Gate and Signature Range are Goodman Fielder brands made using Fonterra-supplied milk.

While there are significant price differences between premium brands and budget brands, the actual milk itself was largely the same, Prichard said.

"There are micro differences. You will have to work very hard to identify them."

There was even very little difference in the taste of organic milk versus non-organic milk, he said.

"The term organic is very hard to nail down and almost impossible to tell when it comes to taste."

Prichard said non-mainstream brands were influencing the milk market's direction more than anyone else, despite making up only about 5 per cent of the overall market.

"Those on the margin are defining the milk market."

KELLY HODEL/STUFF You can thank these guys for your daily milk fix.

Federated Farmers dairy chairman Chris Lewis said he used to drink milk from the vat but since having kids he bought pasteurised milk - light blue top for breakfast and dark blue for coffee.

The Waikato dairy farmer said he's no expert on milk processing but he believes there's very little difference in the different brands.

"It will be pretty identical across the board," Lewis said.

"It doesn't matter whether it's Anchor or Homebrand, it's all made in the same factory."

He said he simply chose whatever brand was cheapest.

"It's a little bit naughty but like everyone else, I'm price conscious."

GERARD HUTCHING/STUFF Supermarket shelves are now awash with choice for consumers when it comes to milk.

As a dairy farmer of 23 years he did not care what brand shoppers chose as long as they were buying milk.

"I'm just stoked they're choosing dairy over those nut juices."

He predicted the milk market had a bright future.

"Milk is a very good product for growing kids.

"Whole generations have been brought up on it."

At Countdown in Ponsonby, Auckland the milk fridge contains more than 30 cows' milk products from 11 different brands, and that doesn't include all the various sizes the bottles come in or things like cream and buttermilk.

A look on Countdown's online shopping store shows even more options.

MIKE SCOTT/STUFF Federated Farmers president Chris Lewis says "it's a little bit naughty" but he buys the cheapest milk available.

From Homebrand dark blue to Anchor zero lacto "tummy friendly" trim blue - there is a milk on the market for all types.

Looking at the ingredients of three different dark blue top milk brands shows they all contain just one ingredient - milk.

However, the way this milk is described varies.

Meadowfresh contains "fresh homogenised milk", Homebrand contains "standardised, pasturised, homogenised milk" and Anchor contains simply "milk".

A Countdown spokeswoman said brand owners like Goodman Fielder bought their milk from milk processors, and added value in a range of ways.

"For example, the Anchor lightproof bottle protects the flavour of milk by stopping light-induced oxidation, or Meadow Fresh's permeate-free milk is less processed."

Its Countdown Select brand came from the same suppliers.

STUFF Standard blue milk now jostles for shelf space with yellow and green.

"So yes, in New Zealand all fresh milk effectively comes from the same place," the spokeswoman said.

Its aim with Countdown milk was to provide a "good everyday option" that was affordable, she said.

"The packaging is basic and costs are kept to a minimum, but it's absolutely as fresh and good quality as any other fresh milk on the market."

University of Auckland senior marketing lecturer Michael Lee said people who bought more expensive milk would be unlikely to know what they were getting beyond what was stated on the bottle.

"It is the brand that is demanding the premium not the product," Lee said.

"Branding does commanded a price premium that people cannot necessarily explain logically."

The milk market had come a long way since the days of unbranded glass bottles being delivered to people's doorsteps.

"It used to be fairly standard - milk was milk."

SUPPLIED University of Auckland senior marketing lecturer Michael Lee says people pay a premium for branding.

Now there was more jostling for brand positions amongst milk producers.

Lee described three tiers of milk products; there's the top shelf brands (literally) such as organic milk brands Lewis Road and Kāpiti single farm and protein-specific A2 milk. Then there's the "mainstay" brands like Anchor and Meadowfresh, and then there's the no-frills brands put out by supermarkets.

"As a product matures or becomes more developed you get this carving out of the pie where people try and occupy certain psychological spaces in the markets that they are trying to target."

Milk producers were heavily reliant on marketing because there was very little variation in milk produced in New Zealand to make producers stand out against competitors, he said.

"The only way that you can command any sort of different price premium is through branding."

The viticulture industry took a similar approach, marketing wine based on target demographics and the vineyard it came from.

Milk branding was likely to evolve by taking another leaf out of the wine industry and promoting individual farms that milk came from, he said.

Tracing the supply chain from "soil to shelf" was becoming a luxury market that high income consumers were willing to pay a premium for, he said.

And that's where boutique dairy company Lewis Road Creamery is taking things.

EVENING POST Do you remember the taste of milk in a bottle?

Headed up by former Saatchi & Saatchi advertising man Peter Cullinane Lewis Road initially developed a cult following thanks to its premium butter.

In 2014 it managed to sear itself into New Zealanders' consciousness after its Lewis Road Whittaker's chocolate milk became the most sought after product in New Zealand.

The public went into such a frenzy that security guards had to be stationed at milk fridges to keep the order.

Cullinane said that chocolate milk phenomenon lifted the whole milk category.

"It was part of a revitalisation of the milk cabinet."

Lewis Road milk is now a permanent fixture on supermarket shelves and, despite what others say, Cullinane believes there is a taste difference between his company's milk and its competitors.

SUPPLIED Lewis Road Creamery founder Peter Cullinane.

"Not all milks are created equal."

He said the different flavour profile came down to what went into the cows and how what came out was treated.

Lewis Road sources milk from organic dairy farm company Green Valley which grazes herds on organic grown grass free of herbicides or pesticides.

The organic herds also have no palm kernel expeller in their diets. Palm kernel expeller, or PKE, is used as an alternative feed for cattle. Its use is controversial due to concerns over its environmental impact in Indonesia, and human rights issues.

"PKE not only taints the taste of milk but it is the by-product of a palm oil production that is one of the worst environmental practices."

TOM PULLAR-STRECKER/STUFF Lewis Road touts its palm kernel free milk.

Herd composition also influenced flavour, he said.

Having jersey and guernsey cows was a focus for Lewis Road because they produced milk with higher fat content and subsequently a better taste and mouth feel, he said.

Then there's the issue of permeate.

Lewis Road, along with other milk brands such as Meadow Fresh, promotes itself as permeate free.

Permeate milk was "stretched" to gain the most volume by adding a dairy byproduct into it, he said.

"I don't buy the argument that you are simply putting back in a natural by product.

"If you want cheaper milk, that's one way of delivering it."

People were prepared to pay for quality if that's what they were getting and Lewis Road aimed to deliver that, he said.

Lewis Road, which retails for about $6 per 1.5 litre bottle, is certified organic, which makes the milk taste better in Cullinane's mind.

"It is demonstrably more expensive to produce organic milk than non-organic milk."

Fonterra says on its Anchor website the word "permeate" is a term used in the dairy industry for the parts of milk that pass through – or permeate – the filter when milk is standardised.

"We don't put marketing claims like 'permeate-free' on our packs – because they could be misleading or confusing. Permeate is simply the water, lactose and minerals naturally occurring in milk, so all milk contains permeate," the website says.