Why Fonterra accepted defeat in the dairy aisle
OPINION: Fonterra's sale of its consumer dairy business to Lactalis is a clear sign of the co-operative’s failure to compete in the branded consumer market.
Federated Farmers Waikato president Andrew McGiven says it’s up to Fonterra’s leadership to reverse its awful financial result.
“It was certainly disappointing and the size of the loss was surprising,” McGiven told Dairy News.
“But the ball is now firmly in the directors’ and senior management’s court as to how they review/revise the strategy to reverse this result.
“The key to this will be an improved communication and PR strategy towards shareholders and suppliers to ensure there is improved confidence from the grassroots so that milk supply is guaranteed.”
McGiven says while the $196 million net loss was “exacerbated by the Danone payout and the Beingmate writedown,” it’s not a good look for the co-op.
At its results announcement, chairman John Monaghan said the co-op is being clear with farmers and unitholders on what it will take to achieve the forecast earnings guidance.
“For the first time we are sharing some business unit specific forecasts. Among others, these see the ingredients and consumer and foodservice businesses achieving an EBIT of between $850 million and $950 million, and between $540 million and $590 million, respectively.
Lifting the performance of the co-op is a key priority for FY19, Monaghan said.
“We are taking a close look at the cooperative’s current portfolio and direction to see where change is needed to do things faster, reduce costs and deliver higher returns on our capital investments.
“[We will assess] all investments, major assets and partnerships against our strategy and target return on capital,” Monaghan says.
The Ministry for the Environment is joining as a national award sponsor in the Ballance Farm Environment Awards (BFEA from next year).
Kiwis are wasting less of their food than they were two years ago, and this has been enough to push New Zealand’s total household food waste bill lower, the 2025 Rabobank KiwiHarvest Food Waste survey has found.
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'Common sense' cuts to government red tape will make it easier for New Zealand to deliver safe food to more markets.
Balclutha farmer Renae Martin remembers the moment she fell in love with cows.
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