What Would Synlait Be Worth to Fonterra or a2 Milk?
Speculation of a possible joint move by Fonterra and a2 Milk to buy Synlait raises a much bigger strategic question, says agribusiness expert Dr Nic Lees.
Fonterra says the products are geared to market needs.
Anchor Fortified Milk Drink is being sold in Ethiopia. The drink is a milk powder specifically formulated to provide families in the emerging Ethiopian market with access to affordable high quality dairy nutrition.
Across the Tasman, the new range of Anchor creams in Australia – Anchor Pure Cream; Anchor Thickened Cream; Anchor Light Thickened Cream – are aimed more to the country’s foodie and culinary culture.
Fonterra’s global brands and nutrition managing director Rene Dedoncker says the ability to appeal in two very different markets shows the power of the cooperative’s everyday nutrition brand Anchor.
“Whether it’s a mature or emerging dairy market, Anchor has a place to play and our product innovations allow us to pick the market position where Anchor is most likely to succeed, get early momentum and make a difference in people’s lives.”
Leveraging Fonterra’s world-class dairy expertise to develop highly nutritious and top quality dairy products for new markets is a key part of the co-op’s growth strategy, says Dedoncker.
“The launch in Ethiopia is an exciting opportunity with our first real move from a consumer brand perspective into Africa and gives us an opportunity for a future regional play. Ethiopia is the second largest population in Africa with close to 100 million people and the fastest growing economy in the world.
“However, despite the staggering economic growth more than 40% of its population are malnourished and lack access to affordable nutrition.”
Fonterra worked with the Food and Nutrition Society of Ethiopia to ensure the drink provides children with the essential nutrients they may be missing from their daily diet.
One glass contains more than 30 nutrients that help a child’s growth and development, including protein, calcium, vitamins A and D, iron and zinc.
“In Australia the chilled cream category is worth over $300 million but in recent years there has been a decline in the number of shoppers purchasing fresh cream. We believe there is a big opportunity to get cream back on the weekly shopping list by motivating foodies to buy cream all year round and packaging it in cook-friendly formats.”
The new range of Anchor cream will be available exclusively in Woolworth’s supermarkets across Australia. This partnership, in conjunction with the 10 year contract to supply fresh white milk for Woolworths Select, helps to strengthen Fonterra’s partnership with the Australian retailer.
The range features bottles designed specifically for cooking. Bottles come in one-cup (250ml) and two-cup (500ml) sizes to help make following recipes easier. Markers have also been added to the side of the bottle to ensure precise pouring and easy measurement.
New Anchor products have also recently been launched in Sri Lanka, China and New Zealand where the brand already has a strong foothold.
In Sri Lanka consumers can buy Anchor in a liquid format. Anchor Liquid Milk is made with milk sourced from Sri Lankan dairy farmers and comes in a one litre UHT pack.
Fonterra’s China business has recently launched the upgraded Anchor Skim Milk, aiming to change the notion that skim milk does not taste as good as whole milk.
Fonterra says, in New Zealand the kids’ yoghurt Anchor Uno, which is now available in a pouch, is proving a hit with consumers. The three flavours that Anchor Uno is available in are outselling the main competitor in the pouch format which has nine flavours. Anchor Uno is growing market share in the kids’ yoghurt category and now sits at 66%.
