Reasons For Changing The Global Dairy Industry Essay

1295 Words6 Pages
New Zealand has always been known worldwide as the home of top-class dairy. Touted as being the largest processor of milk in New Zealand; Fonterra is a dairy co-operative that processes more than 85% of their dairy products that are exported globally
According to Woodford (2008), “in 2001 Fonterra had a market share in excess of 95 percent of all NZ-produced milk, this will have declined by the 2008/09 season to about 90 percent, with further declines likely”. Milk forms the base of dairy products and dairy products was the most substantial contributor to New Zealand’s Gross Domestic Product up until the last 18 months. During this time, the prices of dairy products continued to decrease significantly and also caused declined in the Global Dairy Trade (GDT) auction. The culmination of these changes has caused vast challenges for New Zealand’s economy. This paper will seek to research and discuss general aspects surrounding the reasons for on-going changes in the global dairy industry; specifically as it relates to the in New Zealand operations of Fonterra. It will seek to examine the effects of these changes from different angles on the subject, such as, universal and financial aspects.
Keywords: Fonterra, New Zealand, dairy industry, milk According to a September 1, 2015 article in the NZ Scoop, “Fonterra’s forecast farmgate milk price, which is the price setter in the New Zealand dairy industry, is $3.85/kgMS for the current season, the lowest in a decade”
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