NZ And International Investment Welcomed by Farmers

MEDIA RELEASE

27 August 2014

New Zealand And International Investment Welcomed by Farmers

Fonterra Shareholders’ Council Chairman, Ian Brown said today’s announced investments in New Zealand’s milk pools and a global partnership with China’s Beingmate were bold moves that would be welcomed by the Co-operative’s Farmers.

Mr Brown: “There is a direct link between the $555 million investment in the Lichfield and Edendale sites and the $615 million investment in the partnership with Beingmate in that both align with the Fonterra strategy of increasing the volume and value of our milk.

“The investment in New Zealand operations is a real positive and will optimise the Milk Price we receive by enabling our Co-op greater flexibility in deciding which products our milk goes into and when.

“The added employment opportunities in the construction phase and, long term, within our factories will also prove to be a welcome cash injection for the local communities.”

Mr Brown said the partnership with Beingmate was an important step to increasing access to the high value Chinese nutritional powders market and, in doing so, generating greater profit and returns for Fonterra Farmers.

“China is our number one market and demand for our products continues to grow there.

“Having recently visited the China market it’s difficult to overstate the importance of having a local presence and with Beingmate’s established networks and relationships this joint venture will enable us to move further towards consumer products that add margin over the value of milk.

“Today’s announcements provide our Co-op the opportunity to extract maximum value from every drop of milk we produce through the best use of our global assets.”

Fonterra also announced it was holding its 2014/15 forecast Farmgate Milk Price at $6.00 per kg/MS and estimated dividend range of 20-25 cents per share.

Mr Brown said Farmers would be relieved with the announcement but stressed the importance of continued prudent financial planning particularly with the volatility in the market at present.

ENDS

ABOUT THE FONTERRA SHAREHOLDERS’ COUNCIL

The Fonterra Shareholders’ Council represents the interests of Fonterra Farmers to the Board of the Co-operative and plays an active role in monitoring and assessing the governance and performance of Fonterra.

There are 37 Councillors who are all Shareholders elected by their fellow Farmers in wards across New Zealand.

© Scoop Media