Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Fonterra Looks To Strengthen Its Organics Business

15 April 2013

Fonterra Looks To Strengthen Its Organics Business

Fonterra is renewing contracts for some of its organic dairy farmers in the middle and lower North Island, following a turnaround in its niche organics business.

Managing Director Fonterra Nutrition, Sarah Kennedy, said the Co-operative has worked hard over the past 18 months to return its organics business to profitability.

“18 months ago we were losing money so we restructured the business to focus on markets in Asia, while also reducing our costs to ensure ongoing profitability.

“We reduced transport costs by concentrating organic milk supply in the central and lower North Island.

“Our focus on Asia has also paid off with higher premiums for organic ingredients and increasing demand, mostly out of China.

“Based on this turnaround, we are now able to renew contracts for farmers in the middle and lower North Island who have contracts expiring this year. The remainder of our organic suppliers in these regions have between 1-2 years left in their existing contracts with us.

“We want to ensure we build a business that is sustainable. With that in mind, we are conducting a thorough review to ensure we have the right business model to cope with volatile markets and will come back to our farmers early next year.

“We know our farmers are looking for certainty but it’s critical we get this right for the long-term benefit of the whole Co-operative,” said Ms Kennedy.

The organics plans outlined to farmers today mean:

• Farmers currently supplying organic milk in Manawatu, Taranaki and Wairarapa, who have contracts expiring in FY13, will have them renewed for a further two year term.
• Farmers currently supplying organic milk in the Waikato and Bay of Plenty, who have contracts expiring in FY13, will have them renewed for a further three year term.
• Fonterra will continue to concentrate organic milk supply in the middle and lower North Island, meaning Northland suppliers will not have their contracts renewed.
• Fonterra will update farmers who have contracts expiring in FY14 and FY15 by early next year.

Fonterra is meeting with farmers in Northland, Waikato, Manawatu and Taranaki over the next two days to provide a full update on its organics operations.

- ENDS -

© Scoop Media

Business Headlines | Sci-Tech Headlines


Department Of Conservation: Beech Mast On The Cards After Warm Summer

Climate modelling shows this year’s hot March has increased the chance of beech forest seeding next summer in parts of New Zealand, which could be bad news for native wildlife. The Department of Conservation (DOC) uses data from NIWA’s virtual climate ... More>>

Government: Delivering Lower Card Fees To Business

Commerce and Consumer Affairs Minister David Clark has today announced the Government’s next steps to reduce merchant service fees, that banks charge businesses when customers use a credit or debit card to pay, which is estimated to save New Zealand businesses ... More>>

SEEK NZ Employment Report: April 2021

OVERVIEW OF APRIL 2021: STATE OF THE NATION: April, for the second consecutive month, saw the highest number of jobs ever advertised on Applications per job ad fell 9% month-on-month (m/m). SEEK job ads were up by 12% m/m. SEEK job ads were ... More>>

Geo40: Global Plans To Recover Low-Carbon Lithium At Scale Accelerated By Investment Of Up To $7.5m By Pacific Channel

New Zealand’s leading sustainable, mineral-recovery company, Geo40 Limited has secured up to $7.5m in equity investment from New Zealand deep-tech specialist Venture Capital firm Pacific Channel to fast-track plans to develop its nascent lithium-from-geothermal-fluid ... More>>

Stats: Lower Job Security Linked To Lower Life Satisfaction

People who feel their employment is insecure are more likely than other employed people to rate their overall life satisfaction poorly, Stats NZ said today. New survey data from the March 2021 quarter shows that 26 percent of employed people who thought ... More>>

The Conversation: The Outlook For Coral Reefs Remains Grim Unless We Cut Emissions Fast — New Research

A study of 183 coral reefs worldwide quantified the impacts of ocean warming and acidification on reef growth rates. Even under the lowest emissions scenarios, the future of reefs is not bright. More>>