Fonterra Losing Market Share to Chinese Processors In New Zealand

DT_Grazing_Dairy_Cattle
DT_Grazing_Dairy_Cattle

New Zealand’s largest dairy cooperation, Fonterra, is losing market share to rivals. The catch is that it is happening in Fonterra’s backyard, and to Chinese processors.

While the exodus from New Zealand’s predominant dairy cooperative Fonterra isn’t massive, it is steady, reports New Zealand Public Radio. http://www.radionz.co.nz/news/rural/275738/farmers-leave-fonterra-for-rivals

And farmers are switching for just a few cents per pound of milk solids. Low payouts, low dividends and low share prices are all straining co-op loyalties.

In 2001, before New Zealand deregulated its dairy markets, Fonterra had a 96% market share. While Fonterra milk production has grown by more than 20% in the last five years, it’s total market share is 87%. 

 

 

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