How NZ became a milk giant

29 January 2014

OPINION: More than any other, one name has been synonymous with New Zealand’s major economic prosperity and geographic land use changes over the past decade: global dairy giant Fonterra.

In the wake of a staggering 48 per cent rise in global dairy prices over the past 12 months, many in the Australian milk industry are asking why a Fonterra can’t happen here. After the regulatory hurdles faced by Murray Goulburn’s attempted takeover of Warrnambool Cheese & Butter, local Australian dairy cooperatives can reasonably scratch their heads about why New Zealand’s regulatory set-up cannot be emulated in Australia.

But just how did Fonterra come to be?

In the 1960s New Zealand was home to more than 100 dairy cooperatives, which sold their milk through the government appointed and bureaucratic New Zealand Dairy Board. Consolidations and amalgamations meant that by the mid-1990s, only two major players remained: New Zealand Dairy Group and Kiwi Cooperative Dairies. The commerce commission denied their application to merge on competition grounds.

Read the full opinion article from Farm Online, How NZ became a milk giant, Jan 29