NZ Farm Worker Pay Growth Slows After Post-Pandemic Boom
According to the latest Federated Farmers-Rabobank Farm Remuneration Report, released today, farm worker pay growth has levelled off after a post-Covid period of rapid growth.
That's according to Rabobank's latest Global Dairy Top 20 report.
The report found Lactalis' turnover rose to US$26.7 billion in 2021 - an increase of US$4.7b or 16.2% on the prior year.
Lactalis now sits well clear of second-placed Nestlé, from Switzerland, which recorded turnover of US$21.3b during the same period.
Fonterra retained the sixth spot for the third consecutive year.
Nestlé lost the top slot to Lactalis last 2020.
Rabobank senior agri analyst Emma Higgins says Lactalis' double-digit percentage sales growth was driven by big acquisitions - KraftHeinz's US natural cheese business and Groupe Bel's Royal Bel Leerdammer, Bel Italia, Bel Deutschlad and Bel Shostka Ukraine.
These purchases added a combined estimated annual turnover of about $2.1b to Lactalis' books.
"This acquisition spree has continued into 2022 with the recent purchases of Australian-based Jalna Dairy Foods and German-based Bayerische Milchindustrie's (BMI) Fresh Dairy Division," Higgins notes.
Lactalis is owned by the Besnier family. It was founded in 1933 by Andrei Besnier; his son Emmanuel Besnier is the current chief executive.
Danone, another French company, climbed to third place on the list (turnover of US$20.9b), swapping places with US-based Dairy Farmers of America (US$19.3b).
Chinese dairy giant Yili remained fifth despite its acquisition of Infant Milk Formula producer Ausnutria which helped increase its 2021 turnover to US$18.2b, up from US$13.8b the prior year.
Fonterra claimed sixth spot on the list for the third consecutive year with 2021 sales of US$14.8b, up by US$1.2b on a year ealier.
"During 2021 we saw Fonterra complete the sale of its two wholly-owned China farming hubs," says Higgins.
The company's disposal of DPA Brazil and Soprole - plus potential changes in the Australian-based business - is still pending.
"Despite the sale of its Chinese hubs, greater China remains an important market for Fonterra - particularly for foodservice sales - as do other countries in the broader Asia Pacific region," says Higgins.
Fonterra's annual results for the 2022 financial year will be announced later this month.
Turnover Records
The Rabobank report says the combined 2021 turnover of the Global Dairy Top 20 companies jumped by 9.2% in US dollar terms, following the prior year's modest decline of 0.1%.
"Supported by the recovery in foodservice channels after the initial Covid pandemic and continued strong retail channel sales, global dairy demand firmed during the course of 2021.
"And this, combined with lower-than-anticipated milk production exceptionally strong Chinese import demand, saw dairy product prices rally to elevated levels," says Higgins.
While 2021 sales were up, Higgins says that what is designated as dairy is becoming much more blurred.
"Numerous product launches, dairy alternatives from beverages, yogurts, frozen desserts, cheese and hybrid products have become more common in the product portfolio of Top 20 companies, making it more difficult to extract pure dairy revenues."
