Mr van Leeuwen, who has extensive dairy-farm holdings in South Canterbury, North Otago and Southland, has built the 224m by 32m shed to house 1000 cows, which will be milked through winter at his coastal Waianakarua farm in North Otago.
The premium paid by Fonterra for winter milk along with better feed use by housed cows, less feed wastage and fewer staff, would soon have the shed paid off, he said.
The project was budgeted on a payout of $4.10 a kilo of milk solids (kg m/s).
Fonterra forecast a payout of $6kg m/s for this year, but has since warned it will be lower.
An announcement on the payout will be made on January 27.
Winter milk supplied from mid-May to mid-August received a $3.50kg m/s premium over the regular milk price, but South Island dairy farmers have been reluctant to supply it given the higher production costs.
Mr van Leeuwen was building a second shed at his Glenavy farm as he moved more production to winter milking.
A cow needed 16kg of dry matter of feed a day when outside in winter, but Mr van Leeuwen said that dropped to 8kg of dry matter a day when she was housed, and she produced milk.
Dairy housing was becoming popular, especially in South Otago and Southland, as farmers looked for ways to maintain or lift cow condition over winter, and to improve feed use.
Outdoors, up to 40% of a crop can be trampled uneaten into the mud.
Mr van Leeuwen's cows would calve in early April and go into the shed from early May to mid-October, he said.
They would go outside on fine days but stay inside at night and on cold days.
The manager of the Waianakarua farm, Kelly Campbell, said two people would manage the 1000-cow herd; one person taking just one hour to feed silage and one to milk the cows in the adjacent dairy shed.
Typically, three or four people would be needed to manage that size of herd if the animals were kept outside.
An automated effluent-scraping system, which did not use water, cleared the shed of effluent, which was stored in a sealed pond and used to fertilise paddocks during summer, potentially saving $50,000 in fertiliser costs.
Shed designer Bert Wierkx, of BES Engineering, said the design and technology was standard on North American and European dairy farms, but the concept of dairy housing was relatively new to New Zealand.
Mr van Leeuwen said the cows benefited from the system, and he was working with the weather rather than against it.
The farm traditionally dried out through summer, so rather than trying to grow grass then, he was working with the seasons.
