Climate

Thanks to our grass-fed¹, pasture-based farming practices (as well as other factors like New Zealand's temperate climate), New Zealand farmers are already amongst the world’s most emissions-efficient dairy producers². Our ambition is to be net zero by 2050, and we we believe that we must take action on climate.

¹ Grass-fed means cows mainly grazing on grass and crops in paddocks where they roam. Some farmers may include supplementary feed to help support cows’ nutrition. Visit Fonterra.com/grass-fed for more information.
² Mazzetto, A.M., Falconser, S. & Ledgard, S. (2022). Mapping the carbon footprint of milk production from cattle: A systematic review. Journal of Dairy Science, 105(12), 9713-9725

Given our pasture-based farming system, reducing methane from cows is essential to achieving a meaningful reduction in our overall emissions footprint. So, we are innovating and testing technologies and investing in industry-wide partnerships.

As a Co-op, we are also working to reduce our manufacturing and transport footprint.

Targets and ambitions

Fonterra's Climate Roadmap details Fonterra's near-term targets. Our near-term targets are aligned to the Science Based Target initiative (SBTi), which means they’re aligned to limiting global warming to 1.5˚C.

2025 Milestones

100% of Fonterra’s New Zealand-supplying farms have Farm Environment Plans.
We introduced new funding initiatives to build a stronger Co-op and enhance shareholder value by supporting farmers in reducing on-farm emissions.
We eliminated coal use across all our North Island manufacturing sites, switching off the final coal boiler at Waitoa, and announced further investment plans to enable our shift toward renewable energy solutions.
Our manufacturing sites came close to our FY30 target of a 15% reduction in water take. Commissioning of Hautapu’s new $120 million wastewater treatment plant began in mid-2025 and by working with local stakeholders, our Longburn site was able remove the need for river discharge of wastewater.
Invested in a two year EcoPond Pilot, an innovative effluent pond mobile dosing service.

Near-term Targets³

50.4% absolution reduction in Scope 1 & 2 GHG emissions from a FY18 base year by FY30.⁴
30% intensity reduction in Scope 1 and Scope 3 FLAG GHG emissions from dairy, per tonne of fat-and-protein-correct milk from a FY18 base year by FY30.
78.2% of our suppliers and customers by emissions, covering purchased goods and services, capital goods, upstream and downstream transportation and distribution, business travel and processing of sold products will have science-based targets by FY28.
No deforestation across our primary deforestation-linked commodities, with a target date of no later than 31 December 2025.⁵

Net Zero Ambition

Our net zero 2050 ambition will be supported by:

Continued investment in technology and partnerships to develop solutions.
Elimination of remaining use of coal as an energy source in our operations by 2037.
Understanding the role of offsetting any remaining emissions that are unable to be reduced through best practice approaches.

Climate Roadmap

³ In August 2025, we announced that we have agreed to sell our Consumer and associated businesses to Lactalis, subject to certain conditions including approval by farmer shareholders. Subject to satisfaction of all conditions, the transaction is expected to complete in the first half of the 2026 calendar year. If completed, the scale of the divestment would require us to re-assess our near-term emissions reduction targets.
⁴ The target boundary includes land-related emissions and removals from bioenergy feedstocks.
⁵ We are over 90% of the way towards achieving this target an are committed to making progress, but we are unlikely to achieve it in full by 31 December 2025

Our near-term emissions reduction targets have been set on the basis of what we currently know and reasonably expect to become possible with technological developments, government policy support and on-farm practices. Please refer to our Climate Roadmap for key assumptions and uncertainties. We anticipate that our 2050 net zero ambition will be supported by the actions described in our Climate Roadmap and ambition guiding our work and investment today. Further detail on achievability of our 2050 ambition will be presented as further information and technology becomes available.

Our emissions profile

Starting at 29.3 Mt CO2e total reported emissions globally in 2018.*

Scope 1

4.5% (direct emissions from operations through the use of fuel for energy generation. Addressing emissions from our manufacturing sites, transport and Fonterra owned farms).

Scope 2

1.5% (indirect emissions from the use of purchased energy. Addressing emissions from purchased energy such as electricity and co-generation steam used at our manufacturing sites and offices).

Scope 3

94% (indirect emissions that fall within Fonterra's wider value chain (not already accounted for in Scope 1 or 2), primarily from farming activities. Working with farmers, suppliers, customers, industry, and partners to address emissions).

*Our methodologies and data sources are reviewed annually to determine whether adjustments are necessary, either because of new data availability or to improve our measurement of GHG emissions. A summary of our restatement policy and adjustments to previous years, as well as a full breakdown of emissions by activity, is available in our most recent Annual Report.

On Farm Plans

The first step to reduce emissions is to understand where they come from. Fonterra farmers receive a bespoke Farm Insights Report based on data that they submit to Fonterra, which provides emissions data so farmers can understand how they are trending, how they compare with other farms, and areas for improvement. Farm Insights Reports also highlight unique opportunities for farmers to improve efficiency across milk, animals and environment.

All farms have Farm Environment Plans in place, helping Fonterra farmer owners to support soil health, water quality, biodiversity and reduce emissions.

Insights provided to farmers support them to:

Optimise efficient use of fertiliser
Minimise nitrogen loss
Improve milking efficiency
Improve animal health
Adapt to a changing climate

Other ways we're aiming to reduce emissions along our value chain.

Switching to renewables on our sites.

In 2020, we achieved our target of 20% improvement in energy intensity from a 2003 baseline. As part of our commitment to stop using coal as a fuel source by 2037, we’re now using wood pellets and wood biomass at our Te Awamutu, Stirling, Waitoa and Hautapu sites. We have also installed a 20-megawatt electrode boiler at our Edendale site in Southland.

Decarbonising our fleet

In 2022, we trialled Milk-E, New Zealand’s first electric milk tanker. In FY24 we completed the transition of one third of our New Zealand light transport fleet with low emissions electric vehicles.

Partnering for change.

Fonterra is a major partner in AgriZeroNZ a world-first investment fund established between Government and major agribusiness companies to make sure New Zealand pasture-based farmers have equitable access to affordable and effective tools and technology to reduce their agricultural emissions, while maintaining efficiency, production and profitability.

Sustainability

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Water

World Water Day: How we are protecting and conserving water across the Co-op

22 March 2023
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