Fonterra has taken a 10 per cent shareholding in Lithuania’s biggest dairy producer, AB Rokiskio Suris, securing a supply line of high-value whey ingredients while opening up product options across Europe and the Middle East, and giving the Co-op more opportunities to produce higher value products from New Zealand milk.
The $11.5 million NZD investment is closely aligned to Fonterra’s strategy to grow its global sources of milk in strategic locations, enabling the Co-operative to satisfy customer demand in market closer to those sources.
Chairman John Wilson said today that the investment would enable the Co-op to further optimise the use of New Zealand milk and milk products.
“Our New Zealand farmers will always remain our primary source of milk, but increasingly we are supporting our growth and their returns through strategic partnerships in Europe, Latin America, Australia and China. These partnerships enable us to produce products in demand closer to the market, while providing more opportunity for milk and milk products we make elsewhere.”
CEO Theo Spierings said the two companies had enjoyed a five year commercial relationship and had built a strong relationship.
“Through this investment we have increased our access to high-value whey protein ingredients at a time of rising demand for these products, especially in Eastern and Western European, Middle Eastern and North African markets. This is further progress with our strategy to develop a sustainable European-sourcing network, providing a reliable and efficient chain of supply that complements our New Zealand-sourced ingredients.”
Rokiskio Suris Chairman, Dalius Trumpa, said Fonterra’s investment has helped put Rokiskio on the map.
“Rokiskio’s focus on product quality and safety, as well as its environmental performance were important strengths brought to the partnership while Fonterra’s strong global reputation has lifted Rokiskio Suris to a new level, opening up export opportunities which will generate more value for both companies over the long-term.”
Rokiskio has three factories in Lithuania and makes cheese, butter, whey protein and milk powders. It is one of the largest and most well-known cheese producers in Central and Eastern Europe, producing more than 30 thousand tonnes of cheese each year. The company exports to both Eastern and Western markets, as well as producing a wide range of fresh dairy products for the Baltic region.
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Fonterra Co-operative Group Ltd today upgraded its earnings guidance to 50 – 70 cents per share from 45 - 60 cents per share and lowered and narrowed its forecast Farmgate Milk Price range of $8.50 - $10.00 per kgMS to $8.50 - $ 9.50 per kgMS, with a midpoint of $9.00 while holding its advance rate. It also reported a strong start to the 2023 financial year.
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Fonterra can today confirm that its new Flexible Shareholding capital structure is set to be implemented in late March 2023, subject to the Board being satisfied that the relevant preparations are completed before then.
November 25, 2022