Fonterra is a global leader in dairy nutrition
We supply dairy ingredients to many of the world’s leading food companies, branded dairy products to consumers globally, and out-of-home foodservice to food professionals in bakeries and restaurants across eight key markets.
Fonterra is New Zealand’s biggest company and the world’s largest processor of dairy products. With total revenue of around $22 billion, 22,000 employees (including more than 10,000 outside New Zealand), and a sales network that reaches customers in more than 100 countries, the business is a clear leader in the international dairy market.
Fonterra is a co-operative, owned and supplied by around 10,700 farmer shareholders in New Zealand. The Co-operative collects around 18 billion litres of milk each season in New Zealand, 1.5 billion litres in Australia and 500 million litres in Chile. We also have access to 600 to 800 million litres in Europe and produce safe, secure and high-quality milk from our farms in China to capitalise on opportunities in this market.
Here are the most recent financial results.
Fonterra is an integrated dairy business organised around three complementary business segments:
- Ingredients is the core of the business, where milk supplied by our farmer shareholders is manufactured into export products. These products range from everyday nutrition powders such as Whole Milk Powder to advanced nutritional products used in infant formula, and include butter, cheese and specialty dairy ingredients, which are supplied to customers around the world.
- The consumer and foodservice business focuses on two areas: 1) branded consumer dairy products (such as powders, yoghurts, milk, butter, and cheese, which are sold in supermarkets globally), and 2) out-of-home foodservice, supplying food professionals with dairy solutions such as culinary creams, bakery butters, and a variety of cheeses including slice-on-slice, shredded and extra-stretch mozzarella.
- International farming represents our farming operations in China, supplying high-quality, local milk to the Chinese market.
The ingredients segment represents the ingredients businesses in New Zealand, Australia and Latin America. This segment also includes the Co-operative’s corporate activities and Farm Source™ (formerly RD1), a rural supplies retailer in New Zealand. NZMP™ is the core brand of our ingredients business.
Under the ingredients business, we collect milk from more than 10,700 farmers in New Zealand, using around 500 milk tankers, and process this milk through our 26 manufacturing sites across New Zealand. These range from small sites such as Hautapu, which produces lactoferrin, to the world’s largest dairy processing site at Edendale and the world’s largest dryer at Darfield. Around three million MT of dairy ingredients are produced annually through these sites.
Ingredients are also produced in Australia and Chile with locally sourced milk. In the Netherlands, Fonterra’s ingredients site takes whey from Dutch cheese producer A-ware’s cheese plant and produces specialty whey protein and lactose ingredients destined for high-value markets around the world.
The consumer and foodservice segment represents the brands and foodservice operations in New Zealand, Australia, Asia, Greater China and Latin America.
The consumer and foodservice business generally sources base products from the ingredients business and manufactures them into higher-value dairy products such as yogurt, milk, butter, specialty cheeses and a range of dairy products and solutions for the foodservice industry.
This business includes a focused portfolio of global brands – the Anchor™, Anlene™ and Anmum™ brands – supported by strong regional brands such as Mainland™, Soprole™, Fernleaf™ and Western Star™.
The consumer businesses are targeting number one or two segment positions in our eight key strategic markets of New Zealand, Australia, Malaysia, Indonesia Sri Lanka, China, Chile and Brazil. We already have leadership positions in key dairy categories in New Zealand, Malaysia, Sri Lanka and Chile.
The foodservice business provides a comprehensive range of products and solutions for the commercial kitchen, including bakery butter, cream cheese, specialty whipping and culinary creams, and mozzarella. The business specialises in a ‘chef to chef’ approach, working with customers to design and develop menus incorporating Anchor™ and other foodservice products. These include Asian bakery chains with more than 1,000 outlets, restaurants, hotels, caterers and quick-service restaurants.
This represents our international farming operations in China.
China continues to be an attractive opportunity for growth and we have a long-term plan to build an integrated business in China. We have sufficient scale with access to safe, secure and high-quality milk from our China farms to capture downstream value, such as supplying milk to a chain of leading foodservice outlets. These farms also contribute to the growth and development of the local Chinese dairy industry.