Fonterra to invest in two farms in China

Fonterra says it intends to invest in two dairy farms in China to continue to grow a high quality and secure the supply of milk on the ground. Fonterra China’s MD Philip Turner said the Chinese dairy industry is continuing to develop quickly but the current supply of high quality fresh milk cannot keep up with demand. “We are looking to help grow a safe, secure and sustainable milk supply in China in order to meet this demand and expand our customer base,” he said.

The company has identified several possible sites for the new farms in the Hebei province and will consider partnering on the investment. However, Turner said Fonterra would want to have full management of the farms. “It is important that we keep the next two farms in close proximity to Tangshan Fonterra Farm in order to achieve efficiencies in transport, milk supply and Fonterra management.” He said the company aims to complete the final long-term lease agreement by mid-2010.