Battle for milk
OPINION: Fonterra may be on the verge of selling its consumer business in New Zealand, but the co-operative is not keen on giving any ground to its competitors in the country.
During the last week of November, Casey Thomas, vice president of New Zealand Milk Products (NZMP) Greater China, led representatives of 16 authorised resellers around a dairy farm, manufacturing site and Fonterra's headquarters in Auckland, showcasing what makes New Zealand milk special.
"We really wanted to bring them to New Zealand and show them the journey from the farm to the factory, spend some time at head office and for them to see where the magic starts that enables their businesses in China,” says Thomas who looks after the co-operative’s ingredients business in China.
Fonterra has built solid relationships over the years with the resellers, one of whom had purchased whole milk powder at all but one GDT event since the platform was established in 2008.
“This particular reseller had attended 343 out of 344 GDT events,” Thomas remarked.
Some of the biggest resellers have been working with Fonterra for more than 20 years. They play a key role in developing new sales channels and pipelines to create value for the co-op and bring some stability to the volatile dairy commodities market.
“Our authorised resellers are our critical partners.
“They work alongside our sales team to provide high quality services to our customers, support market insights and compliance, and expand our customer base,” says Thomas.
Fonterra’s main ingredients sold in China are whole milk powder, skim milk powder, cheese, probiotics and protein.
The ingredients are used to create in various products in China including drinking milk, infant formula, cheese powder and medical nutrition products.
“There are also some interesting applications like cheese powder, cheese lollipops and Chinese pastries like pork floss roll,” Thomas says.
China has long been a key market for Fonterra and the favourable margins in the ingredients channel, especially the cheese and protein portfolios, contributed to the co-op’s strong 2023 financial result.
