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.
The launch supports the co-operative’s strategy to deliver endto- end value for farmer owners and builds on Fonterra’s broader portfolio of high-quality dairy solutions, giving customers flexibility to choose what works best for their specific applications.
New Product Targets Growing Bakery Demand
The new product, Anchor Essence Cream, was developed to meet fast‑growing demand in the region and expands Fonterra’s offering with a new option for professional bakers.
Fonterra’s president of global foodservice, Teh‑han Chow, says the launch reflects how quickly customer needs are evolving in the market.
“The launch of Anchor Essence Cream is an example of how we’re delivering on our strategy – bringing high‑performing solutions to market that meet customer needs and support higher‑value demand for New Zealand milk,” he says.
Designed specifically for professional use, the cream delivers a light, smooth texture and reliable performance. It is well suited to cake fillings and soft bakery products, while also supporting whipping, piping and detailed decoration.
Grass-Fed Provenance Provides Competitive Advantage
Anchor Essence Cream carries the FernMark Grass-Fed logo, highlighting its New Zealand origin – making it the first dairy product in market to do so.
The FernMark Grass-Fed is a trusted, government‑backed logo that signals authentic New Zealand origin and reinforces the product’s premium provenance and pasture-based farming.
The New Zealand Grass-Fed Standard, which was announced by the New Zealand Government’s Ministry of Primary Industries in June 2025, states dairy animals must on average have a diet of at least 90% of qualifying grass-fed feed types and must on average graze pasture or forage crops for at least 340 days per year for at least 8 hours per day.
“New Zealand provenance and grass‑fed production really matter in this market,” says Chow.
“Trusted origin and consistent performance help our customers create higher‑quality products that meet changing consumer expectations.”
Premium Dairy Demand Continues to Grow
This demand comes alongside broader growth in cream consumption across the region.
Demand for cream in China has accelerated, with usage expanding well beyond traditional birthday cakes.
Cream is now used across a much wider range of occasions, including beverages, dining and bakery.
Growth is also being driven by shifts in consumer preferences, with a move away from plant‑based fats and alternatives, towards dairy cream, increasingly seen as a premium and natural ingredient. Rapid expansion in foodservice outlets across bakery and beverage is further supporting demand, with dairy cream usage in China’s bakery sector growing from around 10% in 2013 to approximately 40% today.
Together, these trends are driving demand for Fonterra’s high‑quality dairy across China’s bakery and foodservice sectors.
