Fonterra is building new factories to keep up with China’s new appetite for dairy foods, as Bill Bennett reports
Tea macchiato is a modern Chinese drink topped with a mixture of cream and cream cheese, so popular that there are often queues to buy it.
Fonterra’s food services business will soon pass $2 billion in annual revenue and reach $5 billion within the next six years.
“That’s not a forecast, it’s a commitment,” says Fonterra’s director of Global Foodservice, Grant Watson. “China will be a significant contributor to that growth.”
Foodservice sells dairy products to businesses that prepare food outside of the home – everything from restaurants to kiosks, including airline and prison meals.
Watson says the division is growing at three times the rate of the global foodservice industry.
Today the division operates in 75 Chinese cities, and the plan is to reach 160 cities. “China is very important to our business. We’re going as hard as we can and we have great momentum,” he says.
In the last financial year Fonterra grew its combined consumer and foodservice volumes in Greater China by 48 per cent, making the co-operative an industry leader.