According to trade regulators, the company misled customers about the origin of the butter in “100 percent pure New Zealand” products.

A New Zealand dairy company was fined NZ$420,000 (US$261,452) for using imported butter from India in products labelled as locally produced.

The New Zealand Trade Commission said on Monday that Milkio Foods Limited misled its customers about the origin of the butter in its “100 percent pure New Zealand” ghee products.

Hamilton-based Milkio admitted 15 breaches of the Fair Trading Act by making false statements and unauthorised use of the FernMark logo used to label New Zealand products, the commission said.

Vanessa Horne, director general of the Fair Trade Commission, said it was important to hold the company to account because New Zealand “enjoys an international reputation for high quality dairy products, which underpins the value of our dairy industry and our exports”.

“Milkio has exploited this reputation to promote its products with descriptions such as ‘from the clean, green pastures of New Zealand’s dairy farms’ and ‘produced and manufactured in pristine New Zealand’, even though some of their products use imported butter from India,” Horne said.

Horne said the charges should “serve as a warning to others who may attempt to falsely claim the New Zealand trademark”.

Milkio did not immediately respond to a request for comment.

New Zealand’s dairy industry is one of the South Pacific country’s most profitable sectors.

The country has a population of just over five million and is the eighth largest milk producer in the world. According to the Dairy Companies Association of New Zealand, the country exports over 95 percent of its dairy products abroad.

According to the New Zealand Treasury, New Zealand producers exported dairy products worth NZ$23.7 billion (US$14.7 billion) in the year to March 2024, equivalent to almost a quarter of total export value.