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iFAB 2013 DAIRY REVIEW January 2014 v1.00
iFAB 2013
The Food and Beverage Information Project The Food & Beverage Information Project is the first comprehensive overview of the state of New Zealand’s Food & Beverage (F&B) industry. Part of the Government’s Business Growth Agenda (BGA), it is an integrated programme of work focusing on the six key inputs businesses need to succeed, grow and add jobs; export markets, capital markets, innovation, skilled and safe workplaces, natural resources and infrastructure. Essentially, the BGA Export Markets goal will require lifting the ratio of exports from today’s rate of 30% of GDP to 40% by 2025. This equates to doubling exports in real terms (or tripling exports in nominal non-inflation adjusted terms). This in turn equates to achieving a 7% per annum growth rate over the next twelve years. This five-year project analyses the main sectors in F&B, including dairy, meat, seafood, produce, processed foods, and beverages, as well as providing an overview of how the industry is fairing in our major markets. It also conducts in-depth sector reviews on a rotating basis. The information is updated annually and feedback from users shows the project is acting as a vital tool for companies looking to expand and grow exports. Why Food & Beverage? The Food & Beverage industry is vitally important to the New Zealand economy. Food & Beverage accounts for 56% of our merchandise trade exports and one in five jobs across the wider value chain. In addition, F&B acts as a vital ambassador for the country, being in most cases the first exposure global consumers get to “Brand New Zealand.” New Zealand’s F&B exports are growing strongly and the country’s export performance is strong and improving relative to peers. In the 15 years leading up to 2010, New Zealand's food and beverage exports grew at a compound annual rate of 7% per annum. So one way to look at the challenge is to ask – can we continue to grow our food & beverage exports at the same rate? To understand if this is possible we need to know what has been driving our success.
What is the purpose of the food and beverage information project? The project pulls together the available information on the food and beverage industry into one place, in a form which is familiar and useful to business. The reports contain analysis and interpretation of trends and opportunities to materially assist with business strategy and government policy. The information will be of vital use to businesses, investors, government, and research institutions as the industry expands and diversifies. This industry view will be very useful to government, enabling better dialogue and the opportunity to address issues collectively. What benefit will this bring to businesses? The Project will have many uses for businesses. These include:
– As a base of market intelligence to enable business to be much more targeted in their own market research
– Reviewing and informing offshore market development (including export and investment) strategies
– Assisting in identifying areas of innovation and R&D for the future
– Identifying strategic partners and collaborators – Enabling a company to benchmark performance with that
of its competitors – Monitoring industry activity – Gaining a better understanding of their own industry
sector – Identifying internal capability needs or external inputs
How will government use the reports? This information will provide much greater insight into the industry, which is useful for a range of policy development, from regulatory frameworks to investment in science and skills and facilitating access to international markets. In particular, a single source of factual information will enable government agencies to better coordinate their efforts across the system and be more responsive to addressing industry issues.
iFAB 2013
iFAB 2013 OTHER RELATED iFAB REPORTS
3
This analysis of the New Zealand dairy sector forms a part of the wider Food & Beverage Information Project
Other reports, including those from previous years, are available on the MBIE or Coriolis website…
http://www.med.govt.nz/sectors-industries/food-beverage/information-project/ www.foodandbeverage.govt.nz
http://www.coriolisresearch.com/reports/
iFAB 2013
DEFINED AS DAIRY DEFINED AS PROCESSED FOODS
WHAT: Products exclusively or predominantly made from milk; firms that predominantly make these products
WHAT: Products made from a mixture or combination of ingredients, rather a single ingredient; firms that predominantly make these products
EXAMPLES: Fluid milk, milk powder, infant formula base powder, cheese, butter, lactose, dairy casein
EXAMPLES: Chocolate, ice cream, retail-ready infant formula, frozen croissants, Milo & similar, Anlene and other similar dairy nutritionals
TRADE CODES: Primarily classified in the global Harmonised Standard trade codes as HS04
TRADE CODES: Primarily classified in the global Harmonised Standard trade codes as HS 16-21
EXAMPLE FIRMS:
EXAMPLE FIRMS:
NOTE ON DEFINITIONS The iFAB project splits the total New Zealand food & beverage industry into six separate sectors; to avoid double counting, products and firms are only defined and counted in one; some firms may be in another report
4
Ingredients: Dried milk
Ingredients: Nonfat Milk Powder, Lactose, High OleicSafflower Oil, Soy Oil, Coconut Oil, Whey Protein Concentrate. In addition, less than 2% of the following: Potassium Citrate, Calcium Carbonate, Ascorbic Acid, Potassium Chloride, Magnesium Chloride, Ferrous Sulfate, Choline Chloride, Choline Bitartrate, Ascorbyl Palmitate, Sodium Chloride, Taurine, m-Inositol, Zinc Sulfate, Mixed Tocopherols, Niacinamide, d-Alpha-Tocopheryl Acetate, Calcium Pantothenate, L-Carnitine, Cupric Sulfate, Vitamin A Palmitate, Thiamine Chloride Hydrochloride, Riboflavin, Pyridoxine Hydrochloride, Beta-Carotene, Folic Acid, Manganese Sulfate, Phylloquinone, Biotin, Sodium Selenate, Vitamin D3, Cyanocobalamin, Calcium Phosphate, Potassium Phosphate, Potassium Hydroxide, and Nucleotides (Adenosine 5’-Monophosphate, Cytidine 5’-Monophosphate, Disodium Guanosine 5’-Monophosphate, Disodium Uridine 5’-Monophosphate)
THIS REPORT SEE RELATED REPORT
iFAB 2013
iFAB 2013
ANNUAL CHANGE IN EXPORT VALUE BY TYPE US$m; 2012 vs. 2011
BENCHMARK – EXPORT GROWTH BY SECTOR In 2012 the value of New Zealand’s dairy exports shrunk slightly in US$ terms, a relatively poor performance compared to many other food & beverage sectors
6 Source: UN Comtrade database; Coriolis classification and analysis
PERCENT CHANGE IN EXPORT VALUE BY TYPE %; US$m; 2012 vs. 2011
$117
$66
$51
$35
$35
-$23
-$36
-$180
$30
$27
$16
$3
$3
-$2
-$7
Beverage
Processed Food
Seafood
Pet & Animal Foods
Other Foods
Dairy
Produce
Meat
Seed for sowing
Live Animals
Tobacco
Supplements
Fertilisers
HBC/Household
Pharmaceuticals
Net Core F&B +$67m
F&B RELATED CATEGORIES
CORE F&B CATEGORIES
23%
14%
10%
4%
4%
0%
-2%
-4%
57%
48%
33%
28%
15%
-1%
-3%
Other Foods
Pet & Animal Foods
Beverage
Seafood
Processed Food
Dairy
Produce
Meat
Fertilisers
Tobacco
Supplements
Seed for sowing
Live Animals
HBC/Household
PharmaceuticalsNet Related F&B +$70m
iFAB 2013 DAIRY – SITUATION
New Zealand
New Zealand is the 9th largest milk producing country in the world and accounts for 2.4% of global milk production. New Zealand produces a similar amount of milk as other temperate countries its size (e.g. Italy, the UK, France). However as it only has a small population (similar to Singapore), it exports the excess.
The success of New Zealand in dairy is built around a natural environment conducive to agriculture. New Zealand, surrounded by the Pacific Ocean, has the light of Spain with the climate of Bordeaux. This climate will also moderate the effects of global warming going forward (relative to large continents). However this relatively remote location means New Zealand exports transport friendly dairy ingredients (e.g. milk powder) rather than perishable products.
About 88% of New Zealand milk supply is controlled by Fonterra, a farmer-owned cooperative. Fonterra was formed in 2001 in a mega-merger of dairy cooperatives and the export dairy board (a government-mandated) monopsony.1
New Zealand continued to experience strong prices for its dairy products. Global dairy prices remain high by historical standards in US$ terms driven by growing demand in China, SE Asia and NA/ME/CA2.
Competitors
As regional dairy collection is a natural monopsony, dairy farmers in all developed countries control milk collection and primary processing through farmer-owned cooperatives. Dairy co-ops transform their farmers milk into bulk dairy ingredients or basic dairy products, sold under the co-ops own brand or retailer store brands.
New Zealand primarily competes with other dairy cooperatives from developed Western countries to supply bulk dairy ingredients. South America cooperatives are an emerging rival. While the BRIC3 countries are 4 of the top 5 milk producers in the world, they are not yet major exporters as they effectively consume all they produce and will do for the foreseeable future.
New Zealand does not directly compete with major corporate dairy players (e.g. Nestle, Kraft, Abbott), who are in most cases its major customers.
Consumers/Markets
Dairy consumption is flat in the developed world; developed temperate countries (e.g. Canada, Japan) typically produce all the milk they consume and use trade barriers to protect their dairy farmers; therefore New Zealand has limited access to these markets.
Dairy consumption is growing in the developing world faster than domestic production; in addition, dry and tropical countries are unable to efficiently produce all the milk they consume, therefore they import bulk dairy ingredients.
In most markets, developed or developing, corporate consumer-focused dairy manufacturers buy ingredient dairy and transform ingredients into defensible consumer dairy-based foods (e.g. yoghurt).
In Australasia (AU/NZ), Fonterra and Goodman Fielder/Meadow Fresh (but not other key NZ milk processor/exporters) sells significant amounts of branded consumer dairy products to consumers4.
7 1. A monopsony is a monopoly on buying not selling; 2. North Africa Middle East, Central Asia; 3. BRIC = Brazil, Russia, India and China; 4 Fonterra also sells about NZ$1b worth of Anmum outside Australasia
New Zealand competes with other dairy cooperatives to supply bulk dairy ingredients to corporate consumer-focused dairy manufacturers primarily in dry/tropical areas
iFAB 2013 DAIRY – SWOT ANALYSIS The global competitive environment will likely become more competitive going forward
8 Source: various company annual reports; various company websites; Interviews; Coriolis
STRENGTHS WEAKNESSES
- Low cost pasture-based dairy production system
- National champion Fonterra with resources to address global markets and opportunities
- High standards of food safety and animal welfare
- Regulatory credibility
- 130 years experience in exporting dairy
- Strong position in global dairy industry
- Growing market leadership position in Australasia/Oceania
- All our eggs in one basket (Fonterra); Fonterra is limited in its ability to add value due to the risks associated with competing with its own customers
- No rich dairy cultural heritage or tradition to draw from for new product development (vs. France or Italy)
- Small milk producer in an absolute sense
- Limited defensibility of commodity and ingredient position
- Significant trade barriers limiting New Zealand access to North America and Europe
- Farmgate price mixes returns on milk with returns on Fonterra ownership leading to dairy land price increases leading to decreased international competiveness
- Despite strong food safety systems & reputation, a number of recent high-profile issues (e.g. whey, nitrates)
OPPORTUNITIES ISSUES/THREATS/RISKS
- Intensification through additional supplementary feed smoothing seasonal peak increasing total milk production and improving return on assets
- Growing dairy product consumption in developing world; dry and tropical countries not able to produce all the milk they consume
- Chinese dairy consumption per capita growing rapidly drawing in significant imported dairy product (in the short to medium term)
- Asians more likely to be dairy intolerant, therefore different consumption patterns (e.g. yoghurt drinks; infant formula)
- Ongoing dairy industry consolidation, particularly in South America
- Changing global weather patterns (also a threat)
- Further investment in in-market production
- Removal of dairy subsidies into Europe (may also be a threat)
- Intensive feedlot dairy model (e.g. California) improving productivity faster than pasture system (e.g. NZ/AU)
- Southern South America rapidly adopting the AU/NZ pasture system (e.g. Argentina, Uruguay, Brazil)
- The boom/bust economic cycle expresses itself in China
- Experience of Japan & South Korea suggest Chinese growth has another 5-7 years to run; after this point, China will be either self sufficient or a major exporter
- Announced EU regulatory changes coming into effect, leading to increased production by some countries (e.g. Ireland) and decreased production by others
- Developing countries consumers, currently perceive dairy as healthy; science/attitudes/opinions could turn negative
- Adoption of genetically modified animals or feed by poor countries changing international competitive dynamics
- Non-dairy substitutes (e.g. soy) more suited to Asian tastes and physiology
iFAB 2013 DAIRY – POTENTIAL AREAS FOR INVESTMENT
Farmers currently control about 92% of New Zealand dairy industry limiting opportunities for external investment. Farmers own Fonterra, Westland, Tatua and Dairy Goat Coop. “[Globally, dairy cooperatives have] three main objectives: (1) maximise the milk price paid to farmer members, (2) to process and market the milk collected every day from member farms and (3) to maintain farmer control.”1 However the recent introduction of the Fonterra Shareholders’ Fund does make participation in the success of Fonterra possible. There are relatively low opportunities for new investment in ingredient dairy (particularly milk powder). Globally milk collection/disposal is dominated by farmer owned co-operatives (typically marginal cost sellers). Processing of raw dairy into simple ingredients is a relatively high capital, low return sector. New Zealand already fully capitalised with ingredient dairy processing plants and the existing co-ops continue to invest in new capacity to defend their position. As one example, Fonterra recently opened Phase II of it’s Darfield plant, a NZ$500m investment in the world’s largest milk dryer. The domestic New Zealand dairy market is small, saturated and low growth. New Zealand already has high levels of dairy consumption per capita and the market is dominated by two key players: Fonterra and Goodman Fielder/Meadow Fresh, each with fluid milk core. There is limited domestic product innovation and domestic innovations are typically copied from other markets (e.g. yoghurt). In addition, store brands are growing in most core dairy categories. This is not to discount the potential for further investment, particularly in export focused products. We believe there are three key opportunities for consideration:
1. Value-added dairy products There are strong opportunities for growth and investment in value-added dairy products, including infant formula and other dairy nutritionals (e.g. nutritional shakes). In the past three years more than NZ$700m in investment has been announced in infant formula, “growing up” milk (GUMP) and other dairy nutritionals. Fonterra, Westland, Synlait, Gardians/Sutton and New Image all now manufacture infant formula and related dairy nutritionals. In addition, three of the four largest dairy companies in China – Yili, Mengniu, and Bright - have invested in value-added plants in New Zealand, as have a wide range of other global dairy firms, including Friesland (Netherlands), Vinamilk (Vietnam) and Kirin (Japan) as detailed on page 46 of this report. 2. Export-oriented niche dairy There are opportunities for growth in smaller segments of export oriented specialty, niche dairy products that “fly under the radar”. Examples of successful segments in this space include shredded cheese (e.g. Grate Kiwi), single serve butter (e.g. Canary), and premium specialty cheese (e.g. Whitestone). 3. Dairy-based processed foods & beverages There are very strong opportunities for investment in processed foods and beverages that contain significant dairy ingredients. Examples of products with strong potential for further investment include chocolate, frozen bakery (e.g. croissants) and dairy-derived nutraceuticals. Further discussion of these opportunities occurs in the related “Processed Foods” report in this series.
9 1. F.A. Christiansen, Executive Director, MD Foods (now Arla), 1994; Source: Interviews; Coriolis
Potential areas for new and/or external investment primarily transforming ingredients rather than producing more ingredients
iFAB 2013
SIMPLIFIED MODEL OF NEW ZEALAND DAIRY SUPPLY CHAIN1
Model; ANZSIC codes as available; 2013
DAIRY – SUPPLY CHAIN New Zealand dairy products have a somewhat complex supply chain driven by the multiple-stage process of turning raw milk into final products for consumers around the world
10 1. Non-dairy supply chain is covered in the processed foods section; 2. There may be one or more layers of wholesaling, depending on product or market; some wholesale functions may be captive inside retailers or foodservice operators; Source: Coriolis
Milk & cream processing (C113-100)
Dairy produce wholesale (F360-300)
Seafreight Airfreight
Supermarkets & other retail
Foodservice
Dairy wholesale2 (in-market)
Supermarkets & other retail
Foodservice
International markets
Domestic market
Dairy cattle farming (A016)
Distributor wholesaler
Ice cream manufacturing (C113-200)
Cheese & other dairy processing (C113-300)
Infant formula manufacturing
Other food manufacturing
Ice cream manufacturing
Cheese & other dairy processing
Infant formula manufacturing
Other food manufacturing
For example, Fonterra requirement to on-sell
milk to other processors
Processed Foods
Processed Foods
Processed Foods
Processed Foods
iFAB 2013
iFAB 2013 GLOBAL MILK PRODUCTION BY SPECIES Global milk production 740m tons of milk (83% cow milk, 13% water buffalo, 4% all other); total global production has doubled in last fifty years; per capita consumption has been growing for the last decade
GLOBAL MILK PRODUCTION BY SPECIES Tonnes; million; 2011
50 YEAR GLOBAL MILK PRODUCTION BY SPECIES Tonnes; million; 1961-2011
12 * CAGR = Compound Annual Growth Rate; Note: 2011 is latest data available for all countries globally in FAO AgStat as of October 2013; Source: UN FAO AgStat database; Coriolis analysis
Cow 615 83%
Water buffalo 96 13%
Goat 17 2% Sheep 10 2% Camel
2 0%
Total = 739m tonnes
-
100
200
300
400
500
600
700
196
119
63
196
519
67
196
919
7119
7319
7519
7719
7919
81
198
319
85
198
719
89
199
119
93
199
519
97
199
920
01
200
320
05
200
720
09
2011
Cow
Buffalo Goat Sheep Camel
1%
3% 2% 1% 2%
50y CAGR*
50y CAGR
2%
50 YEAR GLOBAL MILK CONSUMPTION PER CAPITA Kilograms/person; 1961-2011
80
85
90
95
100
105
110
11519
61
196
319
65
196
719
69
1971
1973
1975
1977
1979
198
119
83
198
519
87
198
919
91
199
319
95
199
719
99
200
120
03
200
520
07
200
920
11
50y CAGR -0.1%
10y CAGR 1.1%
iFAB 2013
GLOBAL MILK PRODUCTION BY KEY COUNTRIES & REGION Tonnes; million; 2011
GLOBAL MILK PRODUCTION BY REGION New Zealand produces 2% of global milk; global production growth being driven by wider Asian region
13 Note: 2011 is latest data available for all countries globally in FAO AgStat as of October 2013; Source: UN FAO AgStat database; Coriolis analysis
Europe 231 31%
North America 97 13%
Australasia 27 4%
C/S America 82 11%
E Asia 52 7%
SE Asia 4 1%
S Asia 169 23%
NA/ME/CA 52 7%
SS Africa 25 3%
Germany 4% France
3% UK 2%
Poland 2%
Netherlands 2%
Italy 2%
Spain 1% Ireland 1%
Other Europe 7%
Ukraine 1%
Russia 4%
Turkey 2%
USA 12%
Canada 1%
New Zealand 2%
Australia 1%
Brazil 4%
Argentina 2%
Other S America 3%
Mexico 1%
Other C America 1%
China 6%
Japan 1%
Other E Asia 0%
India 17%
Pakistan 5%
Other S Asia 1%
Other 0%
Total = 739m tonnes
139 153 184 178 194 199
63 83
89 101 33 32
65
62
68 75
83 97 11
13
12 14
24 27
19
26
36 43
61
82
4
7
11
18 26
52
0
0
1
1 2
4
28
32
46
72 113
169
7
9
13
16
36
52
7
9
11
13
18
25
0
0
0
0
0
0
344
395
470
533
589
739
1961 1971 1981 1991 2001 2011
Europe
USSR/Russia
N America
Australasia
C/S America
E Asia
SE Asia
S Asia
NA/ME/CA
SS Africa Other
50 YEAR MILK PRODUCTION BY REGION Tonnes; million; 1961-2011
1%
-1%
1%
2%
3%
5%
5%
4%
4%
2%
50y CAGR
50y CAGR
2%
iFAB 2013 TOP 30 MILK PRODUCING COUNTRIES New Zealand is the ninth largest milk producing country in the world; it is the only major developed country producer significantly increasing production
TOP 30 PRODUCERS OF MILK FROM ALL SPECIES Tonnes; million; 2011
10 YEAR PRODUCTION GROWTH RATE CAGR %; tonnes; 2001-2011
14 Source: UN FAO AgStat database; Coriolis analysis
127 89
41 37
32 32
30 25
18 15 14
12 12 11 11 11 11
9 8 8 7 7 7 7 6 6 6 6 5 5
IndiaUSA
ChinaPakistan
BrazilRussia
GermanyFrance
New ZealandTurkey
UKPoland
NetherlandsArgentina
ItalyUkraineMexico
AustraliaCanada
SpainJapan
IranUzbekistan
BelarusEcuador
ColombiaEgypt
IrelandKazakhstan
Romania
4.3% 1.7%
11.4% 3.4%
4.2% -0.4%
0.7% -0.1%
3.2% 4.7%
-0.6% 0.5% 0.7%
1.4% -1.0%
-1.9% 1.3%
-1.5% 0.4% 0.4%
-1.0% 2.0%
6.4% 3.0%
10.1% 0.0%
3.9% 0.3%
2.9% 0.8%
IndiaUSA
ChinaPakistan
BrazilRussia
GermanyFrance
New ZealandTurkey
UKPoland
NetherlandsArgentina
ItalyUkraineMexico
AustraliaCanada
SpainJapan
IranUzbekistan
BelarusEcuador
ColombiaEgypt
IrelandKazakhstan
Romania
iFAB 2013
iFAB 2013 KEY PRODUCTION METRICS New Zealand is increasing milk production long term through (1) more cows on (2) more hectares (3) producing more milk per cow; 6% of the country is currently farmed as dairy
TOTAL EFFECTIVE HECTARES IN DAIRY VS. % OF NZ AREA Ha; 81/82-10/11
TOTAL DAIRY COWS Head; million; 81/82-10/11
16 Note: 2010/11 data latest available as of October 2013; 1. Uses CY data from UN FAO as DairyNZ data does not include town milk supply prior to 1998/99 season; Source: DairyNZ New Zealand Dairy Statistics 2010-11; UN FAO AgStat database; MAF/MPI; Coriolis analysis
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
-
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
1981/82
1982/83
1983/84
1984
/85
1985/8
6
1986
/87
1987/88
1988
/89
1989
/90
1990
/91
1991/92
1992/93
1993/9
4
1994
/95
1995/9
6
1996/97
1997/98
1998
/99
1999/0
0
200
0/0
1
200
1/02
200
2/03
200
3/04
200
4/0
5
200
5/06
200
6/0
7
200
7/08
200
8/0
9
200
9/10
2010
/11
29y CAGR 1.7%
TOTAL MILK PRODUCTION1
Tonnes; million; 1982-2011 AVERAGE KG MILKFAT PER COW Kilograms/cow; 81/82-10/11
Hectare m
% of NZ area
-
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
1981/82
1982/83
1983/84
1984
/85
1985/8
6
1986
/87
1987/88
1988
/89
1989
/90
1990
/91
1991/92
1992/93
1993/9
4
1994
/95
1995/9
6
1996/97
1997/98
1998
/99
1999/0
0
200
0/0
1
200
1/02
200
2/03
200
3/04
200
4/0
5
200
5/06
200
6/0
7
200
7/08
200
8/0
9
200
9/10
2010
/11
29y CAGR 2.8%
0
20
40
60
80
100
120
140
160
180
200
1981/82
1982/83
1983/84
1984
/85
1985/8
6
1986
/87
1987/88
1988
/89
1989
/90
1990
/91
1991/92
1992/93
1993/9
4
1994
/95
1995/9
6
1996/97
1997/98
1998
/99
1999/0
0
200
0/0
1
200
1/02
200
2/03
200
3/04
200
4/0
5
200
5/06
200
6/0
7
200
7/08
200
8/0
9
200
9/10
2010
/11
29y CAGR 1.0%
-
2
4
6
8
10
12
14
16
18
2019
82
198
319
84
198
519
86
198
719
88
198
919
90
199
119
92
199
319
94
199
519
96
199
719
98
199
920
00
200
120
02
200
320
04
200
520
06
200
720
08
200
920
1020
11
29y CAGR 3.4%
iFAB 2013
R² = 0.9452
-
20
40
60
80
100
120
140
160
180
200
1917
1921
1925
1929
1933
1937
194
119
45
194
919
5319
5719
61
196
519
69
1973
1977
198
119
85
198
919
93
199
720
01
200
520
09
RATE OF IMPROVEMENT The efficiency of the New Zealand pastoral dairy system is improving, as are competing systems
93 YEARS GROWTH IN NEW ZEALAND BUTTERFAT PER COW (kg/cow; 1917-2011)
MILK PER COW: NZ VS. SELECT PEERS (t/cow; 1961-2011)
17 Source: UN FAO AgStat; Statistics NZ; Department of Statistics; DairyNZ; Coriolis analysis
USA
Denmark
Australia
Ireland Argentina
New Zealand
China
Brazil
CAGR (17-11) 0.9%
2.2%
1.7%
2.1%
1.9% 2.0%
0.6%
1.8%
1.3%
CAGR (61-11)
-
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
196
119
64
196
719
7019
7319
7619
7919
82
198
519
88
199
119
94
199
720
00
200
320
06
200
9
Chile 0.7%
Obviously milk per cow is only one variable in total system competitiveness
iFAB 2013 PRICES The price of milksolids per kilogram has been growing at 4.6% over the past two decades while the price of dairy farms per hectare has been growing at 9%
AVERAGE DAIRY COOP PAYOUT PER KG. MILKSOLIDS NZ$; actual and inflation-adjusted; 91/92-10/11
AVERAGE DAIRY LAND SALE VALUE PER HECTARE NZ$; 1991-2012
18 Source: DairyNZ; Quotable Value; Coriolis analysis
$-
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
199
1/92
199
2/93
199
3/94
199
4/9
5
199
5/96
199
6/9
7
199
7/98
199
8/9
9
199
9/0
0
200
0/0
1
200
1/02
200
2/03
200
3/04
200
4/0
5
200
5/06
200
6/0
7
200
7/08
200
8/0
9
200
9/10
2010
/11
Nominal Inflation adjusted
19y CAGR 2.2%
19y CAGR 4.6%
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
199
119
92
199
319
94
199
519
96
199
719
98
199
920
00
200
120
02
200
320
04
200
520
06
200
720
08
200
920
1020
1120
12
21y CAGR
9%
N/A
iFAB 2013
iFAB 2013 NUMBER OF FIRMS The number of dairy processing firms has grown, particularly since the melamine crisis in China in 2008
NUMBER OF DAIRY PROCESSING ENTERPRISES1
Enterprises; 2002-2012
20 Note: 2012 data latest available as of October 2013; 1. Defined as C113-100 Milk & Cream processing and C113-300 Other dairy processing; Source: Statistics NZ business demographics database; Coriolis analysis
53 52
57 58 58 59 58
73
80
85 89
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
5.3%
8.6%
4.7%
CAGR 10y
CAGR 5y
CAGR 1y
CHANGE IN NUMBER OF DAIRY PROCESSING ENTERPRISES CAGR; absolute change; periods as given
36
30
4
ABS 10y
ABS 5y
ABS 1y
iFAB 2013
ANNUAL TURNOVER BY TOP 10 DAIRY FIRMS NZ$m; FY2012
iFAB TOP TEN DAIRY FIRM TURNOVER FY12 Fonterra continues as the largest dairy firm in New Zealand by turnover in FY12
21 Source: various company annual reports; NZCO; Coriolis estimates and analysis
$641
$546
$534
$377
$228
$125
$118*
$62
$28
Fonterra
Open Country
Meadow Fresh
Westland
Synlait
Tatua
Miraka
Dairy Goat
A2
Lion Dairy
$19,769 1
2
3
4
5
6
7
8
9
10
iFAB 2013
CHANGE IN ANNUAL TURNOVER BY TOP 10 DAIRY FIRMS NZ$m; FY2012 vs. FY2011
iFAB TOP TEN DAIRY TURNOVER GROWTH FY12 In FY12 Miraka, Synlait & Dairy Goat led in absolute growth and Miraka, A2 & Dairy Goat led in rate of growth
22 Source: various company annual reports; NZCO; Coriolis estimates and analysis
$125
$78
$30
$28
$20
$19
$0
-$21
-$38
-$102
Miraka
Synlait
Dairy Goat
Tatua
A2
Westland
Lion Dairy
Meadow Fresh
Open Country
Fonterra
48%
34%
26%
14%
4%
1%
-1%
-4%
-6%
Miraka
A2
Dairy Goat
Synlait
Tatua
Westland
Lion Dairy
Fonterra
Meadow Fresh
Open Country
ANNUAL TURNOVER % GROWTH BY TOP 10 DAIRY FIRMS NZ$m; FY2012 vs. FY 2011
∞% 1
2
3
4
5
6
7
1
2
3
4
5
6
7
iFAB 2013
5 YEARS ANNUAL TURNOVER BY TOP 10 DAIRY FIRMS NZ$m; FY2007-FY2012
TOP TEN DAIRY FIRM TURNOVER Five year growth highlights robust growth of new market entrants, Westland & Dairy Goat Cooperative
23 N/C = not calculable from data available; Source: various company annual reports; NZCO; Coriolis estimates and analysis
$13,882
$19,512
$16,035 $16,726
$19,871 $19,769
$84
$143
$289
$497
$679 $641
$439
$604
$569
$565
$567 $546
$295
$501
$364
$422
$515 $534
$-
$-
$112
$233
$299 $377
$145
$184
$204
$166
$200 $228
2007 2008 2009 2010 2011 2012
Fonterra
Open Country
Meadow Fresh
Westland Synlait Tatua
Lion Dairy A2 Dairy Goat Miraka
7%
50%
4%
N/C 9%
13%
-9% N/C 16% N/C
5y CAGR (07-12)
iFAB 2013 KEY PRODUCTION METRICS The dairy processing industry has not grown employment, suggesting productivity improvements
TOTAL EMPLOYMENT BY DAIRY PROCESSING ENTERPRISES Headcount; as of Feb; 2002-2012
24 Note: 2012 data latest available as of October 2013; 1. Defined as C113-100 Milk & Cream processing and c113-300 Other dairy processing; Source: Statistics NZ business demographics database; Coriolis analysis
9,910
10,950
11,640 11,960
12,620
10,870
9,950 10,440
10,810 10,890 10,750
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
CHANGE IN DAIRY PROCESSING EMPLOYMENT CAGR; Absolute change; periods as given
1%
0%
-1%
CAGR 10y
CAGR 5y
CAGR 1y
840
-120
-140
ABS 10y
ABS 5y
ABS 1y
iFAB 2013 EMPLOYMENT BY REGION Dairy processing employment growing in Waikato and Canterbury over last five years; flat to down elsewhere
DAIRY PROCESSING EMPLOYMENT BY REGION Headcount; as of Feb; 2007-2012
5 YEAR CHANGE IN EMPLOYMENT BY REGION CAGR; Absolute change; 2007-2012
25 1. Data is geographic level; classified elsewhere would include non-dairy processing activities (e.g. wholesaling); Source: Statistics New Zealand, Coriolis analysis
1,080 740
1,142 1,025 820 845
950 910
980 1,070 1,180 1,300
240
230
230 240 240 260 116
96
90 95 106 104
1,060
1,080
1,190 1,040 800
830
1,870
1,850 1,180 1,570
1,913 1,823
75
95 60 50 55 39
410 503 510
510 610 420
2,510 2,610 2,565
2,830 3,030 3,045
890 670 920
920 765 815
715
480 480
490 560 520
954
686 1,093
970 811 749
10,870
9,950
10,440 10,810 10,890 10,750
2007 2008 2009 2010 2011 2012
Otago/Southland
Canterbury
West Coast Nelson/Tas/Marl
Taranaki
Hawkes Bay/Gisborne Bay of Plenty
Waikato
Auckland
Northland
Classified elsewhere1
Wellington/ Manawatu
-235
350
20
-12
-230
-47
-36
10
535
-75
-195
-205
Otago/Southland
Canterbury
West Coast
M/N/T
W/M
Taranaki
HB/Gisb
Bay of Plenty
Waikato
Auckland
Northland
Classified elsewhere
5y ABS -120
iFAB 2013
DAIRY PROCESSING EMPLOYMENT BY KEY FIRM
Headcount; 2013
EMPLOYMENT BY FIRM Fonterra accounts for ~85% of industry employment; all other dairy firms account for 15%
26 * Includes dairy, meat, plant and allocated staff from HO, freight, supply chain, sales and merchandising staff; Source: SNZ business demographics; Kompass; various firm websites; published articles; Coriolis interviews & analysis
Fonterra, 9,000
Meadow Fresh*, 930
Westland, 400
Tatua, 280
Open Country, 200 Synlait, 171
Dairy Goat, 170 Lion Dairy, 100
Miraka, 78
iFAB 2013
Rank Announced Investment Firm Facility Location Opened/planned
1 2010 $500 Fonterra World's largest 30 tonne an hour dryer Opened in two phases
Darfield Phase 1 : August 2012 Phase 2: Sept 2013
2 Apr 2013 $250m Fonterra Evaluating extending plant and building another spray dryer
Pahiatua -
3 Dec 2012 $214m Yili Infant formula plant (47,000t, 100 people)
Glenavy, Canterbury June 2014
4 Feb 2013
$212m Yashili Processing plant (52,000t, 120 people) Pokeno Feb 2015
5 Jan 2013 $126m Fonterra New UHT plant (Milk and cream for FS), 90 new staff
Waitoa, Waikato March 2014
6 2013 $103m + $17m
Synlait Dryer 3 (WMP, SMP, formulated) + new dry store (22,500m2)
Dunsandel, Canterbury Aug 2015 March 2014
7 June 2011 $100m Synlait New plant (Dryer 2, for IF and Nutritionals)
Dunsandel, Canterbury Sept 2011
8 Sept 2012 $100m Westland Three dryer powder plant, - consents granted Feb 2012
Rolleston -
9 July 2010
$90m Miraka Milk powder plant (35,000 WMP) Mokai, Taupo August 2011
10 April 2013
$67m Dairy Goat Second dryer (4x capacity), + canning Hamilton August 2014
IDENTIFIED MAJOR INVESTMENTS IN NEW PLANT/EQUIPMENT As of October 2013
iFAB TOP TEN NEW DAIRY INVESTMENT The top ten dairy investments that have emerged over the past few years total almost $2b
27 Source: Coriolis from various published articles and annual reports
iFAB 2013
Announced Investment Firm Facility Location Opened/planned
April 2013 $65m Tatua New specialty products drier planned Matamata 2015/2016 season
Sept 2012 - Westland Nutritional Products plant (wet mix) Hokitika April 2013
April 2013 - Paterson/Gardian New IF plant, (20,000.tpa, 11,500 cows) Balclutha, Otago Sept 2012
2011/2013 $53m Fonterra Further upgrades to dry distribution centre Whareroa, Taranaki 2012/August 2014
Oct 2012 $30m Fonterra Extension of Cream cheese mnfg. Te Rapa August 2013
May 2013 $27m Synlait Blending and consumer packaging 17,500MTpa Dunsandel, Canterbury June 2014
April 2013 $27m Miraka New UHT plant Mokai, Taupo Feb 2014
Nov 2012 $20m Open Country Plant upgrade (SMP, + Milk fats) Waharoa, Waikato June 2013
July 2010 - NZ Dairy Processing New UHT and dairy plant Tauranga
Jan 2011 $20m Westland Reverse osmosis plant Rolleston September 2011
2010 $20m Tatua New foods plant, specialty powders Matamata 2010/11 season
May 2013 $15m Synlait Upgrade to special drier, to produce lactoferrin in spray dry form ; 23 MTpa
Dunsandel, Canterbury January 2014
May 2013 $15m Synlait Ammix butter plant 25MTpa Dunsandel, Canterbury May 2015
June 2012 $11m Innovation Waikato Spray drier – pilot plant Hamilton June 2012
2011 $10m Tatua New permeate & hydrolstate plant Matamata August 2012
2013 - Kaimai Assets sold and company to convert to UHT milk Waharoa 2014
IDENTIFIED MAJOR INVESTMENTS IN NEW PLANT/EQUIPMENT As of October 2013
OTHER NEW DAIRY INVESTMENT A wide range of other dairy industry investments have been identified
28 Source: Coriolis from various published articles and annual reports
iFAB 2013
Rank Acquirer Target Price Date Details
1 Bright Dairy (China) Synlait $82m July 2010 51% of Synlait
2 Southern Pastures Limited Partnership (Forsta AP-fonden, Sweden)
CHH HBU & Rank Group Property (Graeme Hart’s dairy farms)
~$40-60m (TBC)
Aug 2013 Swedish Company investment includes 8 forestry converted dairy farms in the Waikato 3,205ha Operated by Southern Pastures Management – supplying Fonterra
3 Fonterra 6% of Bega Cheese Australia A$46m Nov 2013 Acquired 6% of Australian cheese firm; “longstanding partnership”
4 Fonterra New Zealand Dairies Nutritek Russia (in receivership)
$48.5m Sept 2012 Milk processing factory Studholme ,Waimate (former assets owned by Nutritek), purchased out of receivership
5 Olam International NZ Farming Systems Uruguay $40m (TBC)
Nov 2012 Increased ownership from 78% acquired in 2010 to 90% allowing Olam to compulsorily acquire the rest (valued at $178m)
6 FrieslandCampina 7.5% of Synlait $24.15m July 2013 Netherlands coop invests in NZ dairy industry taking 7.5% of Synlait
7 Yili Oceania Dairy Ltd US$2.5m (TBC)
Dec 2012 Land use consent for the construction of a whole milk processing plant/IF ($214m, 100 jobs, 47,000 tpa), environmental consents and purchasing rights on a 38 hectare site.
8 Synlait Milk Oceania Dairy Ltd - Feb 2011 Purchased supply contracts increasing farms from 105 to 135 in Waimate, South Canterbury (agreement to acquire all assets based on land and consents for plant failed).
9 Mengniu Yashili HK$12.5b (NZ$2b)
June 2013 #2 Chinese dairy producer acquired #3 Chinese–owned infant formula firm; including planned plant in Pokeno, Waikato
10 Pureland Dairy/ Yoomoo dairy
Kaimai assets - Sept 2013 Purchased by Pureland plans to export UHT milk
IDENTIFIED MAJOR ACQUISITIONS INVOLVING NEW ZEALAND DAIRY FIRMS As of October 2013
iFAB TOP TEN DAIRY ACQUISITIONS All recent major acquisitions in the New Zealand dairy industry have involved foreign buyers or sellers
29 Source: Coriolis from various published articles and annual reports
iFAB 2013
Date Investor Origin Investment Investor description
Oct 2013 SFL Holdings (Shanghai Pengxin 74%, Maclean,Penno)
China Offer to buyout remaining shareholders in Synlait Farms (awaiting OIO clearance)
Private: Chinese diversified conglomerate
July 2013 FrieslandCampina Netherlands 7.5% of Synlait Milk Coop; #1 EU Coop; #5 dairy firm globally
June 2013 Mengniu China Yashili (including Pokeno IF plant plans) Listed; #2 dairy in China; #15 dairy firm globally; COFCO SOE 19%
Dec 2012 Yili China Building ~$214m IF plant in New Zealand Listed; #1 dairy in China; #12 dairy firm globally
Nov 2012 Olam Singapore 90% NZ Farming Systems Uruguay (18% to 78% in Aug 2010)
Listed; agribusiness and food ingredients conglomerate
Sept 2010 Vinamilk Vietnam 19% of Miraka Listed; largest dairy company in Vietnam
July 2010 Bright China 39% of Synlait; diluted down from original 51%
Listed subsidiary of State Owned Enterprise
May 2010 Freedom Foods Australia 18% of A2 Corp Listed; 82% Arrowvest; free-from & organic foods;
July 2008 Olam International Singapore 25% of Open Country Cheese Company (via. Dairy Trust)
Listed; agribusiness and food ingredients conglomerate
Nov 2007 Kirin Japan Lion Dairy (Yoplait factory in NZ) Listed; member Mitsubishi keiretsu; #2 Japanese brewer
June 2007 Mitsui & Co Japan 14% of Synlait; raised to 22%; now 8.4% Listed; trading company; member of Mitsui Group
Sept 2005 Goodman Fielder Australia NZDF; later traded for Mainland Listed; Australian baked goods & other foods company
FOREIGN INVESTMENT IN MAJOR NEW ZEALAND DAIRY FIRMS As of October 2013
FOREIGN INVESTORS New Zealand dairy companies have attracted significant foreign investment
30 Source: Coriolis from various published articles and annual reports
iFAB 2013
iFAB 2013
FONTERRA CO-OPERATIVE GP Theo Spierings Chief Executive
OPEN COUNTRY Steven Koekemoer Chief Executive
GOODMAN FIELDER NZ MEADOW FRESH DIV. Peter Reidie Managing Director GFNZ
WESTLAND Rod Quin Chief Executive
DESCRIPTION: Fourth largest dairy company in the world by turnover; first by milk intake
DESCRIPTION: A dairy ingredient manufacturer, 3 plants; capacity 900m l/year; 500 suppliers, exports to 45 countries
DESCRIPTION: Dairy division of major Australasian food group (also includes meats businesses), milk and cultured foods plants in Palmerston North and Christchurch, and a speciality cheese plant in Puhoi Valley.
DESCRIPTION: Regional dairy cooperative based in West Coast region; expanding into Canterbury, 4% milk supply
KEY PRODUCTS: Milk powder, butter, cheese, yoghurt, formulas and other dairy products
KEY PRODUCTS: Full range of Milk Powders (Standard and UHT), Milk Proteins, Milk Fats and Cheese
KEY PRODUCTS: Milk, fresh and UHT, Cheese, Yoghurt, and other dairy products
KEY PRODUCTS: Milk powders, milk proteins, growing up milk powder, butter, base IF, bioactives, ‘own made’ yoghurt “Easiyo”, other dairy products
OWNERSHIP: New Zealand; cooperative (10,578 farmer shareholders)
OWNERSHIP: Private; AFFCO/Talley’s Group 54%; Olam (Singapore) 25%; others
OWNERSHIP: Australia; listed on ASX/NZX; wholly owned subsidiary of Goodman Fielder Ltd
OWNERSHIP: New Zealand; cooperative (380+ farmers)
COMPANY NUMBER: 1166320 COMPANY NUMBER: 1911063 COMPANY NUMBER: 1715832 COMPANY NUMBER: 153032
ADDRESS: 9 Princes Street, Auckland Central, Auckland 1010
ADDRESS: Unit L Building 4, 195 Main Highway, Ellerslie, Auckland 1051
ADDRESS: 2/8 Nelson Street, Auckland, 1010 PO Box 90450, Victoria Street West, Auckland 1142
ADDRESS: 56 Livingstone Street, Hokitika, 7810 , New Zealand
PHONE: +64 9 374 9000 PHONE: +64 9 589 1372 PHONE: +64 9 301 6000 PHONE: +64 3 756 9800
WEBSITE: www.fonterra.com WEBSITE: www.opencountry.co.nz WEBSITE: www.goodmanfielder.co.nz www.meadowfresh.co.nz
WEBSITE: www.westland.co.nz www.easiyo.com
YEAR FORMED: 2001 YEAR FORMED: 2004/2007 YEAR FORMED: 1909/1968/1986/2005 YEAR FORMED: 1937
STAFF EMPLOYED: 17,000 (Global) STAFF EMPLOYED: 200 STAFF EMPLOYED: Dairy & Meat Division 930* (GF total NZ = 2,190)
STAFF EMPLOYED: 400
REVENUE: $19,769m (FY12), $18,643m (FY13) REVENUE: $641m (FY12) REVENUE: Dairy NZ$546m (FY12) [ex-Intercompany] NZ Total NZ$1,088m (FY12)
REVENUE: $534m (FY12) $535 (FY13)
COMPANY HIGHLIGHTS: Drought; precautionary recall; plant expansions in NZ, New plants in Asia, Investment of ~$1b in dairy farms in China
COMPANY HIGHLIGHTS: Company has increased number of suppliers to 600 and will process 947m litres of their own milk for 2013/2014 season. Focused on high quality ingredients is providing steady growth and profitability.
COMPANY HIGHLIGHTS: Meadow Fresh formed as part of a brand swap in 2005 (ex Mainland Products). Export expansion plans from CHCH in UHT could significantly increase production
COMPANY HIGHLIGHTS: Commissioned a Nutritional wet products plant in Hokitika during 2013 and gained resource consents for new Rolleston plant
32 *Includes plant and allocated including HO staff, freight, supply chain, sales and merchandising staff; Source: Coriolis from various published articles and annual reports
TOP 10 DAIRY FIRM PROFILES 1 2 3 4
iFAB 2013
SYNLAIT MILK LIMITED John Penno Managing Director
TATUA CO-OPERATIVE DAIRY Paul McGilvary Chief Executive
MIRAKA Richard Wyeth Chief Executive
DAIRY GOAT CO-OPERATIVE Dave Stanley Chief Executive
DESCRIPTION: Synlait Milk is a Canterbury based dairy manufacturer focussed on supplying higher value dairy products to leading milk-based health and nutrition companies
DESCRIPTION: Specialist dairy ingredients and food products manufacturer, 190ML of milkpa exports 94% of its products, exports to 60 countries
DESCRIPTION: New Zealand dairy processing plant processing 240m litres of milk pa from 96 suppliers, manufacturing products for export to China and Vietnam
DESCRIPTION: Manufacturer of goat milk infant formula and other dairy goat milk based nutritionals
KEY PRODUCTS: Infant and adult nutritional formulations, Milk powders (WMP, SMP) functional food ingredients, and specialised products
KEY PRODUCTS: specialist ingredients (Caseinate, whey proteins, AMF), nutritionals, whipped cream, specialty cheeses
KEY PRODUCTS: WMP, SMP, Standard and UHT KEY PRODUCTS: Infant formula
OWNERSHIP: New Zealand; listed on NZX; Bright (China) 39% ; Mitsui (Japan) 8%; Friesland (Netherlands) 7.5%
OWNERSHIP: New Zealand; cooperative (108 farmers)
OWNERSHIP: Wairarapa Moana Incorp 27%; Tuaropaki Kaitiaki 27%; Vinamilk Vietnam Dairy Products 19%
OWNERSHIP: New Zealand; cooperative (65 farmers)
COMPANY NUMBER: 1600872 COMPANY NUMBER: 173822 COMPANY NUMBER: 2244299 COMPANY NUMBER: 421398
ADDRESS: 1028 Heslerton Road, Rakaia, Rd 13 , New Zealand
ADDRESS: State Highway 26, Tatuanui, Waikato ADDRESS: 108 Tuwharetoa Street, Taupo, 3330 , New Zealand
ADDRESS: 18 Gallagher Drive Hamilton
PHONE: +64 3 373 3000 PHONE: +64 7 889 3999 PHONE: +64 7 376 0075 PHONE: + 64 7 839 2919
WEBSITE: www.synlait.com WEBSITE: www.tatua.com WEBSITE: www.miraka.co.nz WEBSITE: www.dgc.co.nz
YEAR FORMED: 2000/2005 YEAR FORMED: 1914 YEAR FORMED: 2009 YEAR FORMED: 1984 (Inc. 1989)
STAFF EMPLOYED: 130 (FY12), 171 (FY13) STAFF EMPLOYED: 280 STAFF EMPLOYED: 78 STAFF EMPLOYED: 170
REVENUE: $377 (FY12) $420 (FY13) REVENUE: $228m (FY12) REVENUE: $125m (‘FY12) $164m (FY13) REVENUE: $118m (FY12), $130m* (FY13)
COMPANY HIGHLIGHTS: Went public in July 2013 $120m capital raising it restructure debt and reinvest; upgraded plant to produce spray dry lactoferrin
COMPANY HIGHLIGHTS: Plans for a new speciality products drier worth $65m
COMPANY HIGHLIGHTS: New dairy plant operating in Taupo with 36,000t WMP; New UHT plant to be built to process Shanghai Pengxin farms
COMPANY HIGHLIGHTS: Revenue exceeded $100m for first time in FY12; building second dryer with 4x capacity for $67m; 14 new suppliers for 13/14 season; CEO stepping down March 2014 after 20 years; being replaced by Tony Giles
33 * Estimate; Source: Coriolis from various published articles and annual reports
TOP 10 DAIRY FIRM PROFILES 5 6 7 8
iFAB 2013
A2 CORPORATION Geoff Babidge Managing Director
LION DAIRY & DRINKS NZ Peter Kean MD - Lion Dairy & Drinks
DESCRIPTION: Genetic testing for A2 gene, related IP and retailing of A2 brand dairy products
DESCRIPTION: New Zealand operations of licensed manufacturer of Yoplait brand in Australasia, NZ is regional division of large dairy, beverages company.
KEY PRODUCTS: Milk, infant formula, other dairy KEY PRODUCTS: Yoghurt
OWNERSHIP: New Zealand; listed on NZX; 17% Freedom Foods (Australia)
OWNERSHIP: Japan; Kirin Holdings; listed on TYO:2503 (via. National Foods Au )
COMPANY NUMBER: 1014105 COMPANY NUMBER: 1035697
ADDRESS: PO Box 109 349, Newmarket 1149, Auckland
ADDRESS: 27 Napier Street, Freemans Bay, Auckland 1011
PHONE: +61 2 9697 7000 PHONE: +64-6-355 1155
WEBSITE: a2corporation.com WEBSITE: www.yoplait.co.nz/ www.lionco.com/brands/dairy-and-drinks/
YEAR FORMED: 2000 YEAR FORMED: 2000
STAFF EMPLOYED: 70 (worldwide) STAFF EMPLOYED: 50 (plant), 49 (HO) = 99
REVENUE: NZ$62m (FY12), NZ$94.3m (FY13) REVENUE: $28m (FY12)
COMPANY HIGHLIGHTS: UK JV launched Robert Wiseman; launched A2 Platinum into Chinese market; $20m capital raising; moved to NZX ; contracted Synlait to manufacture a2 IF; new milk processing plant in Sydney, AU (2012)
COMPANY HIGHLIGHTS: Since 2011 known as Lion
34 Source: Coriolis from various published articles and annual reports
TOP 10 DAIRY FIRM PROFILES 9 10
iFAB 2013
Company
MD/CEO
Business description
Ownership Company #
Formed
Revenue
Staff
Address
Website
CANARY ENTERPRISES Derek Bartosh Director
Portion controlled butter Private 1116438
2001 $15-20m*
30 33 Kaimiro Street PO Box 20241, Te Rapa Hamilton
www.canarybutter.co.nz
BALLANTYNE FOODS NZ BUTTER CANNERS
Andrew Ballantyne Director
Canned butter factory in Morrinsville factory (NZ Butter Canners) is 50% owned by Fonterra
Private 2367708
1936 (AU) 1980 (NZ)
BF $6m (FY12) $31 (07)
n/a
Allen Street Morrinsville
www.ballantyne.com.au
KLONDYKE FRESH Nigel Gormack Director
Fluid milk manufacturing plant in Christchurch
Private 1409139
2003 $8-12m*
35 19 Klondyke Drive, Hornby, Christchurch
www.klondykefresh.co.nz
THE GRATE KIWI CHEESE CO. GKC 2013
Michael Laird Director
Processor & repacker of bulk cheese into large catering packs of cheese; store brand cheese
Private 1790551 (DIFL 30%)
1990/ 2006
TBD
40 67-69 Druces Rd Manukau Auckland
www.kiwicheese.co.nz;
MILLIGANS FOOD GROUP
Bruce Paton Managing Director
Milk Powders, Cheese, Cheese Sauce, Butter, AMF, WPC, WPI, Ice Cream, Syrups, Flour, Bakery Products, Mayonnaise
Private 565193
1896/ 1993
$20-25 (CE)
21-50 1 Chelmer Street, Oamaru, 9400
www.milligans.co.nz
BLUE RIVER DAIRY Keith Neylon Director
Sheep: Cheese, milk powder, ice cream (canning plant), starting sheep IF
Private 4583083
2013 $10-15m*
25 111 Nith Street, Invercargill, 9810
www.blueriverdairy.co.nz
EPICUREAN DAIRY Angus Allan Director
Gourmet soft cheeses, smoothies, yoghurt and haloumi
Private 3734658
2009/2012
$7-10m*
n/a
119 Lansford Crescent, Avondale, Auckland 1026
www.epicdairy.com www.thecollectivedairy.com
GREEN VALLEY DAIRIES
Bruce Pulman Director
Organic milk & cream, yoghurt & butter
Private (HEB Contstruction) 1280111
2003 $2-5m n/a
206 Bell Road Mangatawhiri, North Waikato 2471
www.gvd.co.nz www.marphona.co.nz/
WHITESTONE CHEESE Bob Berry Managing Director Simon Berry CEO
Specialty cheeses (blue, brie, feta, camembert, hard) butter
Private 147247
1966/ 1987
$5-10m 60 3 Torridge St, Oamaru 9400
www.whitestonecheese.co.nz
OTHER DAIRY FIRM PROFILES
35 * Estimate based on number of employees and type of business activity; Source: Coriolis from various published articles and annual reports
iFAB 2013
Company
MD/CEO
Business description
Ownership Company #
Formed
Revenue
Staff
Address
Website
KAIMAI CHEESE CO Jiahui Miao CEO
Soft and hard cheese manufacturer, inc. brie, blue, camembert
Private (Singapore) Pureland Dairy
2005 $2-5* 15 Hawes Street, Waharoa, Waikato
www.kaimai.co.nz acquired Te Mata in 2009 Oct 2013 sold assets for cheese and converting to UHT
BIOFARM Catherine Tait-Jamieson Director
Organic yoghurt, butter and milk products
Private 577954
1993 $2-5* n/a
118 Te Matai Road, Palmerston North
www.biofarm.com
YASHILI NZ DAIRY
William Zhao GM New Zealand
In progress dairy/infant formula plant in Pokeno; parent recently acquired by Mengniu
Public (China) 3922659
2012 $0 n/a 666 Great South Road,, Level 2, Building 10, Ellerslie, Auckland, 1051
www.yashili.hk www.mengniuir.com
Inner Mongolia YILI Industrial Group Co.
n/a
Purchased land to build a IF plant in Morven
Public (China) 90%, Hohhot Invest (10%)
n/a $0 n/a Morven, South Canterbury
OTHER DAIRY FIRM PROFILES
36 * Estimate based on number of employees and type of business activity; Source: Coriolis from various published articles and annual reports
iFAB 2013
iFAB 2013
10 YEAR NEW ZEALAND DAIRY EXPORT VALUE BY SUPER-REGION US$m; 2002-2012
DAIRY EXPORTS BY REGION Over the past decade New Zealand dairy exports have achieved strong growth driven primarily by the developing world; however they are down in the last year
38 Source: UN Comtrade database; Coriolis analysis
Europe 1% +$25m
N. America 6% +$358m
Australia/ Pacific Is. 11% +$289m
NA/ME/CA 19% +$1,609m
Indian Sub 17% +$293m
SE Asia 12% +$1,223m
E Asia 20% +$2,653m
TOTAL 13% +$7,085m
C/S America 8% +$467m
SS Africa 26% +$342m
CAGR Absolute
10 Year
10y CAGR 13%
$413 $471 $452 $453 $490 $504 $502 $416 $467 $545 $438
$447 $477 $545 $645 $611 $720 $826 $598 $541
$720 $805 $156 $163 $224 $234 $254 $334 $434 $311 $465
$520 $445 $396 $422 $441 $485 $514
$927 $1,005
$586 $784
$963 $862
$38 $67 $90 $95 $151
$201 $259
$212 $307
$403 $380
$336 $381
$492 $627
$779
$1,019
$1,315
$1,025
$1,309
$1,915 $1,945
$80 $92
$112 $140
$169
$229
$270
$226
$397
$481 $372
$581 $695
$772 $787
$896
$1,431
$1,634
$1,119
$1,592
$1,888 $1,805
$521 $572
$747 $772
$773
$980
$1,201
$1,241
$2,135
$2,813 $3,174
$2,966 $3,341
$3,875 $4,239
$4,639
$6,345
$7,445
$5,735
$7,995
$10,249 $10,226
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
iFAB 2013
TOP 25 DAIRY MARKETS BY EXPORT VALUE US$m; 2012
EXPORT DOLLARS China continues to be the number one dairy export market
39 *Hong Kong Special Administrative Region (SAR); Source: UN Comtrade database; Coriolis analysis
$2,142 $686
$395 $385 $375 $371 $367 $364 $355
$329 $326
$287 $252
$235 $209 $204 $203
$177 $171
$159 $139 $138
$113 $105 $96
ChinaUSA
JapanSaudi Arabia
United Arab EmiratesMalaysia
VenezuelaPhilippines
IndonesiaAlgeria
AustraliaEgypt
SingaporeThailandSri Lanka
Viet NamTaiwan
IranMexico
Rep. of KoreaNigeria
*Hong Kong SARGermany
BangladeshPeru
iFAB 2013
TOP 25 DAIRY MARKETS BY CHANGE IN EXPORT VALUE US$m
EXPORT DOLLAR GROWTH China & Middle East driving dollar value growth
40 Source: UN Comtrade database; Coriolis analysis
$1,839 $299
$172 $162
$106 $100 $99 $99 $98 $98 $97 $93 $87 $78 $76 $72 $64 $56 $49 $48 $47 $40 $40 $38 $36
ChinaUnited Arab Emirates
EgyptAlgeria
VenezuelaMalaysia
Hong Kong SARSingapore
IranUSA
IndonesiaSaudi Arabia
BangladeshPeru
NigeriaAustralia
Rep. of KoreaTaiwan
JapanLibya
Viet NamSri LankaThailand
SudanGermany
$365 $56 $54 $54 $50 $49
$42 $37 $32 $30 $27
$18 $17 $12 $12 $10 $8 $7 $5 $5 $5 $3 $3 $3 $3
ChinaHong Kong SAR
United Arab EmiratesEgyptUSAPeru
IndonesiaLibya
GermanyNigeria
Viet NamIran
BelgiumPakistan
ChileOman
South AfricaAzerbaijan
MalaysiaGuyana
Papua New GuineaSenegal
JordanCanadaUkraine
5 YEAR CHANGE; 07-12 1 YEAR CHANGE; 11-12
iFAB 2013
BOTTOM 25 DAIRY MARKETS BY CHANGE IN EXPORT VALUE US$m
EXPORT DOLLAR DECLINE Mexico, Denmark & Thailand leading declining markets by value
41 Source: UN Comtrade database; Coriolis analysis
-$1 -$1 -$2 -$2 -$2 -$2 -$3 -$3 -$3 -$4 -$6 -$8 -$9
-$10 -$11
-$16 -$18
-$27 -$38
-$50 -$63
-$67 -$70
-$179
Neth. AntillesSeychellesTajikistanPolandGhanaJamaicaKuwaitArgentinaPakistanBrazilEl SalvadorOmanUnited KingdomGuatemalaPanamaDominican Rep.PhilippinesSyriaItalyCanadaBelgiumCubaDenmarkMexico
-$6 -$8 -$9 -$9
-$12 -$13
-$19 -$19
-$20 -$21
-$22 -$26 -$26
-$35 -$37
-$41 -$45
-$49 -$54
-$58 -$64
-$67 -$79
-$95 -$110
MauritiusDominican Rep.BahrainBangladeshItalyVenezuelaSudanKuwaitMoroccoRep. of KoreaJapanGhanaSingaporeRussian FederationSyriaCubaTaiwanPhilippinesSri LankaIndiaAlgeriaAustraliaThailandMexicoDenmark
Net -$81m
5 YEAR CHANGE; 07-12 1 YEAR CHANGE; 11-12
iFAB 2013
TOP 25 DAIRY MARKETS BY CAGR PERCENT CHANGE IN EXPORT VALUE US$m; %
PERCENT GROWTH Strong growth rates coming out of Uruguay, Iraq & Africa
42 Source: UN Comtrade database; Coriolis analysis
162% 161%
146% 137%
78% 77% 76%
68% 63%
57% 49% 48% 46%
42% 40% 40% 39% 38% 38%
33% 33% 33% 32% 30% 29%
MongoliaIraq
UkraineCôte d'IvoireSierra LeoneMacao SAR
MozambiqueLibya
UruguayRomania
SurinameChina
TurkeyBangladesh
PeruSenegal
MadagascarMyanmar
United Arab…India
DjiboutiHaitiChile
BahrainHong Kong SAR
900% 387%
369% 245% 240%
221% 201%
167% 152% 145%
122% 108% 106% 104% 101%
84% 83%
68% 64% 62% 56% 51% 42% 41% 40%
UruguayIraq
TanzaniaLibya
Sierra LeoneSuriname
MozambiqueKazakhstanMacao SAR
KiribatiChile
TunisiaNiue
DominicaPeru
NepalDjibouti
Hong Kong SARSpain
SeychellesPakistan
GuineaEl Salvador
GuyanaGermany
5 YEAR CAGR; 07-12 1 YEAR CHANGE; 11-12
iFAB 2013
TOP 25 DAIRY MARKETS BY CAGR PERCENT CHANGE IN EXPORT VALUE US$m
PERCENT DECLINE Argentina & Eastern Europe stand out in declining markets
43 Source: UN Comtrade database; Coriolis analysis
-20% -22%
-25% -26% -26%
-28% -29% -29% -31%
-34% -38%
-100% -100% -100% -100% -100% -100% -100% -100% -100% -100% -100% -100% -100% -100%
CongoDominican Rep.SeychellesUnited Rep. of TanzaniaItalyCubaBoliviaGabonSwitzerlandTajikistanDenmarkEcuadorUgandaGibraltarBelarusCayman IsdsCroatiaMaltaCyprusAlbaniaBulgariaComorosNeth. AntillesZambiaArgentina
-53% -53% -53% -54% -54% -55%
-68% -70% -70%
-72% -72%
-81% -82% -83%
-89% -90% -92% -94% -95%
-97% -100% -100% -100% -100% -100%
ItalyCambodiaTuvaluSyriaBoliviaDominican Rep.BeninMarshall IsdsSwitzerlandIndiaCubaGabonLiberiaCongoHondurasGambiaPalauDenmarkTajikistanMauritaniaSloveniaChadLithuaniaZambiaArgentina
5 YEAR CAGR; 07-12 1 YEAR CHANGE; 11-12
iFAB 2013
TOTAL DAIRY EXPORT VALUE IN 2012: NZ VS. COMPETITORS US$m; 2012; 2012 vs. 2011
BENCHMARK – EXPORT GROWTH VS. COMPETITORS New Zealand’s dairy export performance in a difficult year globally was good relative to key competitors other than the United States (discussed next page)
44 Source: UN Comtrade database; Coriolis analysis
EXPORT VALUE 2012 1 YEAR $ CHANGE IN VALUE 1 YEAR % CHANGE IN VALUE
$10,509
$10,226
$8,001
$7,815
$4,991
$2,685
$2,470
$2,440
$1,390
$215
$39
Germany
New Zealand
France
Netherlands
USA
Denmark
Ireland
Australia
Argentina
Canada
Japan
$269
$9
$5
-$11
-$23
-$162
-$188
-$403
-$421
-$666
-$865
USA
Australia
Canada
Japan
New Zealand
Denmark
Argentina
France
Ireland
Germany
Netherlands
6%
2%
0%
0%
-5%
-6%
-6%
-10%
-12%
-15%
-22%
USA
Canada
Australia
New Zealand
France
Denmark
Germany
Netherlands
Argentina
Ireland
Japan
iFAB 2013
-$400 -$200 $- $200 $400 $600
Mexico
China
New Zealand
Philippines
Canada
Algeria
Brazil
Peru
Chile
Australia
Iran
Morocco
Singapore
Colombia
Saudi Arabia
NET Other
NZ
USA
$10,249
$4,722
$10,226
$4,991
New Zealand USA
DAIRY EXPORT VALUE: NZ VS. USA US$m; 2011-2012
FOCUS – NZ VS. USA The United States is growing dairy exports in a range of traditional New Zealand markets as New Zealand reorients to China
45 Source: UN Comtrade database; Coriolis analysis
2011 2012 2011 2012
-$23
+$269
TOP 15 US DAIRY EXPORT MARKETS BY 1Y VALUE GROWTH VS. NZ US$m; 2012 vs. 2011
Lactose primarily for infant formula
iFAB 2013
iFAB 2013
10 YEAR NEW ZEALAND DAIRY EXPORT BY CATEGORY/SUPER-CATEGORY (HS4/6 LEVEL) US$m; 2002-2012
DAIRY – EXPORTS BY TYPE New Zealand dairy exports have achieved strong overall growth in the past decade
47 Source: UN Comtrade database; Coriolis analysis
Fluid milk & cream 15% +$126m
Skim Milk Powder (SMP)
11% +$808m
Whole Milk Powder (WMP)
20% +$3,543m
Whey & natural milk cons.
45% +$586m
Butter & fats 13% +$1,118m
All cheeses 8% +$626m
All lactose 11% +$32m Caseins 4% +$244m
Other 6% +$177m
TOTAL 13% +$7,259m
CAGR Absolute
10 Year
10y CAGR 13%
$40 $39 $55 $55 $53 $72 $104 $89 $127 $167 $165 $445 $462 $472 $477 $657 $949 $880 $829 $1,023 $1,274 $1,253 $700 $931 $1,120 $1,277
$1,395
$2,041 $2,513
$1,859
$3,066
$4,222 $4,243
$15 $20
$119 $299
$322
$455
$507
$353
$419
$557 $601
$487 $550
$636 $661
$699
$880
$1,213
$950
$1,545
$1,968 $1,606
$545 $561
$688 $758
$803
$963
$1,135
$856
$1,023
$1,078 $1,171
$18 $17
$22
$35 $34
$70
$53
$40
$33
$40 $50
$473 $483
$467
$463 $484
$621
$696
$528
$476
$613 $717
$243 $278
$296 $213
$192
$295
$345
$233
$282
$330 $420
$2,966 $3,341
$3,875 $4,239
$4,639
$6,345
$7,445
$5,735
$7,995
$10,249 $10,226
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
iFAB 2013
EXPORT VALUE OF TOP 22 DAIRY PRODUCTS (HS6 LEVEL) EXPORTS IN 2012 US$m; 2012
EXPORT DOLLARS Whole and skim milk powder continue to be New Zealand’s two largest dairy exports; however there is a strong group of other emerging dairy products
48 Source: UN Comtrade database; Coriolis analysis
$4,243 $1,253
$916 $799
$680 $513
$407 $310
$185 $129
$97 $88 $87 $86 $74 $50 $30 $9 $8 $5 $4 $2
Whole Milk PowderSkim Milk Powder
ButterCheese, cheddar, etc.
Other milk fats and oilsNatural milk constituent nes
CaseinCaseinates/other derivatives
Fresh cheeseButtermilk powder, other fermented
Grated or powdered cheeseProcessed cheese
Whey & modified wheyUHT milk, other whole fluid
High fat fluid milkLactose 99%
Sweetened WMPDairy spreads
YogurtLow fat fluid milk
Sweetened condensedBlue-veined cheese
iFAB 2013
ANNUAL CHANGE IN EXPORT VALUE OF TOP 22 DAIRY EXPORTS US$m; 2012 vs. 2011
EXPORT DOLLAR GROWTH In 2012, casein and cheese grew export value, while butter and other fats were down
49 Source: UN Comtrade database; Coriolis analysis
$97 $94
$26 $24
$20 $20 $19
$10 $7 $5 $4 $3 $2 $2 $0
-$5 -$6
-$8 -$18
-$20 -$141
-$216
CaseinCheese, cheddar, etc.
Fresh cheeseNatural milk constituent nes
Bulk Infant Formula; other sweet WMPWMP
Whey & modified wheyLactose 99%
Caseinates/other derivativesYogurt
Sweetened condensedButtermilk powder, other fermented
UHT milk, other whole fluidLow fat fluid milk
Blue-veined cheeseDairy spreads
High fat fluid milkProcessed cheese
Grated or powdered cheeseSMP
Other milk fats and oilsButter
Net -$81m
iFAB 2013
ANNUAL PERCENT GROWTH IN TOP 22 DAIRY EXPORTS US$m; 2012 vs. 2011
PERCENT GROWTH In 2012, sweetened condensed milk, bulk infant formula and yogurt grew at the fastest rate
50 Source: UN Comtrade database; Coriolis analysis
209% 201%
52% 31%
28% 25%
16% 13%
9% 5% 3% 2% 2% 0%
-2% -7% -8%
-16% -17% -19%
-34%
Sweetened condensedBulk IF; other sweet WMP
YogurtLow fat fluid milk
CaseinWhey & modified whey
Lactose 99%Fresh cheese
Cheese, cheddar, etc.Blue-veined cheese
Natural milk constituent nesUHT milk, other whole fluid
Buttermilk powder, other fermentedCaseinates/other derivatives
WMPSMP
High fat fluid milkProcessed cheese
Grated or powdered cheeseOther milk fats and oils
ButterDairy spreads
3,344%
iFAB 2013
VALUE PER KILOGRAM OF TOP 22 DAIRY EXPORTS US$m; 2012
$/KG In 2012 blue vein cheese, bulk/base infant formula, sweetened condensed milk and caseins lead in terms of export dollars per kilo
51 Source: UN Comtrade database; Coriolis analysis
$13.82 $10.60
$10.29 $9.73
$8.03 $6.00
$5.73 $4.80
$4.04 $3.85
$3.68 $3.61
$3.32 $3.31 $3.23 $3.17 $3.09
$3.00 $2.41
$2.27 $1.28
$0.89
Blue-veined cheeseBulk IF; other sweet WMP
Sweetened condensedCaseinates/other derivatives
CaseinWhey & modified whey
Natural milk constituent nesYogurt
Processed cheeseGrated or powdered cheese
Fresh cheeseCheese, cheddar, etc.
ButterWMP
Other milk fats and oilsSMP
Dairy spreadsButtermilk powder, other fermented
Lactose 99%High fat fluid milkLow fat fluid milk
UHT milk, other whole fluid
Wt. Average $3.47
iFAB 2013
ANNUAL CHANGE IN VALUE PER KILOGRAM OF TOP 22 DAIRY EXPORTS US$m; 2012 vs. 2011
$/KG CHANGE In 2012 sweetened condensed milk and bulk/base infant formula achieved good price increases, while fats and casein were down strongly
52 Source: UN Comtrade database; Coriolis analysis
837% 375%
111% 44% 43% 40%
13% 7% 2%
-9% -21%
-27% -29% -34%
-42% -43% -47% -48%
-88% -96% -98%
-165%
Sweetened condensedBulk IF; other sweet WMP
YogurtLactose 99%
Caseinates/other derivativesWhey & modified whey
Blue-veined cheeseLow fat fluid milk
UHT milk, other whole fluidGrated or powdered cheese
Fresh cheeseHigh fat fluid milk
SMPProcessed cheese
WMPButtermilk powder, other fermented
Natural milk constituent nesCheese, cheddar, etc.
Dairy spreadsButter
CaseinOther milk fats and oils
iFAB 2013
iFAB 2013
Representing
Funding
Website/notes
DairyNZ
Farmers
- Levy and other funding - Govt co-funded research program (e.g.
Primary Growth Partnership $170m)
www.dairynz.co.nz Merger of Dairy InSight and Dexcel
Processors & exporters
- Membership Fees
www.dcanz.com
Farmers & sharemilkers
- Membership Fees www.fedfarm.org.nz/industry/dairy
NZ Large Herd Association
Large farmers
- Conference fees www.largeherds.co.nz
KEY DAIRY INDUSTRY ORGANISATIONS 2013
DAIRY – INDUSTRY ORGANISATIONS As a major dairy producer, New Zealand has a strong range of dairy industry organisations
54 Source: Coriolis analysis
iFAB 2013
Focus & activities
Riddett Institute
- www.riddet.massey.ac.nz - Hosted by Massey University in partnership with University of Otago, The University of Auckland, Plant and Food
Research, AgResearch - National Centre of Research Excellence (CORE) - Research in food industry in particular the dairy industry
- www.fonterraresearch.com - Fonterra Research Centre - Dairy centre and pilot plant in Palmerton North
AgResearch - Foods & Bio-based Products; food composition and function, The role of foods in human health and wellbeing
- Industry good activity - Research farms, feed, farm systems, animal sciences
KEY DAIRY RESEARCH BODIES IN NEW ZEALAND 2013
DAIRY – INDUSTRY SCIENTIFIC RESEARCH New Zealand has strength in dairy research across a range of research institutes
55 Source: Coriolis analysis
iFAB 2013 METHODOLOGY & DATA SOURCES
This report uses a range of information sources, both qualitative and quantitative.
The numbers in this report come from multiple sources. While we believe the data are directionally correct, we recognise the limitations in what information is available. In many cases different data sources disagree (e.g. Statistics New Zealand vs. FAO vs. UN Comtrade). Many data sources themselves incorporate estimates of industry experts (e.g. FAO AgStat). As one example, in many cases, the value and/or volume recorded as exported by one country does not match the amount recorded as being received as imports by the counterparty [for understood reasons]. In addition, in some places, we have made our own clearly noted estimates.
All trade data analysed in all sections of the F&B Information project are calculated and displayed in US$. This is done for a range of reasons:
1. It is the currency most used in international trade
2. It allows for cross country comparisons (e.g. vs. Denmark)
3. It removes the impact of NZD exchange rate variability
4. It is more comprehensible to non-NZ audiences (e.g. foreign investors)
5. It is the currency in which the United Nations collects and tabulates global trade data
The opinions expressed in this report represent those of the industry participants interviewed and the authors. These do not necessarily represent those of Coriolis Limited or the New Zealand Government.
Coriolis has not been asked to independently verify or audit the information or material provided to it by or on behalf of the Client or any of the data sources used in the project. The information contained in the report and any commentary has been compiled from information and material supplied by third party sources and publicly available information which may (in part) be inaccurate or incomplete. Coriolis makes no representation, warranty or guarantee, whether express or implied, as to the quality, accuracy, reliability, currency or completeness of the information provided in the report.
If you have any questions about the methodology, sources or accuracy of any part of this report, please contact project lead Tim Morris at Coriolis, on +64 9 623 1848
56
Data was from a variety of sources, and has a number of identified limitations
iFAB 2013
GLOBAL HARMONISED SYSTEM (HS) TRADE CODES DEFINED AS DAIRY HS2002
TRADE CODES Project defines the following trade codes as dairy
57 Source: United Nations codes; Coriolis definitions in conjunction with project steering group
HS Code Short Description Longer official description
040110 Low fat fluid milk Milk not concentrated nor sweetened < 1% fat
040120 UHT milk, other whole fluid Milk not concentrated nor sweetened 1-6% fat
040130 High fat fluid milk Milk and cream not concentrated nor sweetened < 6% fat
040210 SMP (skim milk powder) Milk in powder/granules/other solid form, fat content by wt. not >1.5%
040221 WMP (whole milk powder) Milk in powder/granules/other solid form, unsweetened, fat content by wt. >1.5%
040229 Bulk IF (infant formula); other sweet WMP Milk in powder/granules/other solid form, sweetened, fat content by wt. >1.5%
040291 Unsweetened condensed Milk & cream, concentrated (excl. in powder), unsweetened
040299 Sweetened condensed Milk & cream, concentrated (excl. in powder), sweetened
040310 Yogurt Yogurt
040390 Buttermilk powder, other fermented Buttermilk/curdled milk & cream/kephir & other ferm./acidified milk & cream, whether or not concentrated/sweetened/flavoured/cont. fruit/nuts/cocoa
040410 Whey & modified whey Whey & modified whey, whether or not concentrated/sweetened
040490 Natural milk constituent nes Milk prods. of nat. milk constituents, whether or not sweetened, n.e.s.
040510 Butter Butter
040520 Dairy spreads Dairy spreads
040590 Other milk fats and oils Fats & oils derived from milk, other than butter & dairy spreads
040610 Fresh cheese Fresh (unripened/uncured) cheese, incl. whey cheese, & curd
040620 Grated or powdered cheese Grated/powdered cheese, of all kinds
040630 Processed cheese Processed cheese, not grated/powdered
040640 Blue-veined cheese Blue-veined cheese
040690 Cheese, cheddar, etc. Cheese (excl. of 0406.10-0406.40)
170211 Lactose 99% Lactose & lactose syrup, cont. by wt. 99%/more lactose, expressed as anhydrous lactose, calc. on the dry matter
170219 Lactose, other Lactose & lactose syrup, cont. by wt. >95% but <99% lactose, expressed as anhydrous lactose, calc. on the dry matter
350110 Casein Casein
350190 Caseinates /other derivatives Caseinates & other casein derivatives.; casein glues
iFAB 2013 GLOSSARY OF TERMS
58
This report uses the following acronyms and abbreviations
A$/AUD Australian dollar N/C Not calculable
ABS Absolute change N.H Northern Hemisphere
ANZSIC AU/NZ Standard Industry Classification NZ New Zealand
AU Australia NZ$/NZD New Zealand dollar
Australasia Australia and New Zealand R&D Research and Development
b Billion S Asia South Asia (Indian Subcontinent)
CAGR Compound Annual Growth Rate SE Asia South East Asia
C/S America Central & South America (Latin America) S.H Southern Hemisphere
CRI Crown Research Institute SS Africa Sub-Saharan Africa
CY Calendar year (ending Dec 21) T/O Turnover
E Asia East Asia US/USA United States of America
EBITDA Earnings before interest, tax, depreciation and amortization
US$/USD United States dollar
FAO Food and Agriculture Organisation of the UN UK United Kingdom
FY Financial year (of firm in question) US United States of America
£/GBP British pounds YE Year ending
JV Joint venture YTD Year to date
m Million Sources
n/a Not available/not applicable AR Annual report
NA/ME/CA North Africa / Middle East / Central Asia Ce Coriolis estimate
N. America North America (USA, Canada) Ci Coriolis interview
Nec/nes Not elsewhere classified/not elsewhere specified
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