UPDATE: Fonterra offloads its Australian yoghurt business to Parmalat

Fonterra has announced it will sell its Australian yoghurt and dairy dessert business to Parmalat Australia.

The sale, which is conditional on regulatory and other approvals, is expected to be completed in the first half the of the 2016 calendar year.

The divestment of its Australian yoghurt and dairy desserts business, which includes manufacturing sites at Tamar Valley and Echuca as well as its Australian yoghurt and dairy dessert brands, is part of a comprehensive plan to return the Australian business to strong and sustainable profitability. 

Chief Executive Theo Spierings said these changes were the result of driving a clear strategic plan to transform the Australian business to deliver stronger returns to farmer shareholders and unit holders.

“We are focusing on areas where we can win in a highly competitive market, and that means optimising our product mix and streamlining operations to match, and investing in higher value add products that will deliver the best returns for our farmer shareholders and unit holders.”

“As a key part of our multi-hub strategy, we are matching these strengths with the opportunities across our 100 markets,” said Spierings.

Fonterra Managing Director Oceania Judith Swales said Fonterra is “totally committed to the Australian dairy industry”

“We will continue investing in programs and innovation that supports our market-leading brands in key retail categories, including Western Star butter and Perfect Italiano, Mainland and Bega cheeses, Anchor cream, and fresh milk.”

“Divesting the yoghurt and dairy desserts business will allow us to focus on what we do best, so we can continue delivering a competitive milk price to our suppliers, benefits to our customers, innovative dairy foods to our consumers, and improved returns to our farmer shareholders and unit holders,” concluded Ms Swales.

According to a Fonterra spokesperson, the decision to sell our Australian yoghurt and dairy dessert business is part of a comprehensive plan to return Fonterra’s Australian business to strong and sustainable profitability.

"The sale will allow us to focus on what we do best, and lock in our competitive position in the Australian market – we will focus on investing in the growth of our other market-leading brands, including Western Star, Perfect Italiano, Bega, and Mainland, and our recently launched Anchor brand."

"It’s no secret our yoghurt and dairy desserts business has been challenged in recent years," the spokesperson said."

"Our people have worked hard to improve the returns from our yoghurt and dairy dessert business, and their efforts have resulted in good performance from Tamar Valley and agreements achieved with key customers to drive volume and category growth. It is a sign of respect for their hard work that all employees at our Echuca and Tamar Valley plants have received offers of employment from Parmalat."

"This sale will have no impact to our Anchor or Riverina Fresh yoghurt, which we produce in foodservice format at our Wagga Wagga facility, nor will it impact our New Zealand yoghurt business."

Australians being urged to buy local ham this Xmas

Australia’s most awarded butcher, Adam Stratton, is urging people to “buy local” this Christmas when it comes to selecting their festive hams.

Adam Stratton is a master butcher and runs the successful Tender Gourmet Butchery chain in Sydney. 

“Around 22 million kilograms of ham is sold in Australia at Christmas, but unfortunately, not all of that is sourced locally,” said Stratton.

“I think customers should know if the ham they serve for Christmas lunch might have spent three months on a boat being shipped in from overseas. Who knows what refrigeration has been used to get the produce here.”

“Pork products are flooding the local market from places such as Scandinavia, Asia and North America. When it comes to Christmas hams, there is no substitute for local produce. Australian produce is a clear winner for appearance, taste and value.”

“Customers need to look for the hot pink Australian PorkMark logo – this is a guarantee that the ham is made with 100 per cent Australian home-grown pork.

“In fact, research shows that around 90 per cent of Australians prefer to buy Australian produce because they believe Australian pork is fresher, of a higher quality and tastes better,” he said.

Latest figures show that nearly $10 million worth ($9.4m) of imported pork arrives in Australia every week destined to be made into ham and bacon.

Dodgy prawn packaging costs Kailis almost $11,000

According to the West Australian newspaper, seafood company Kailis Bros has been hit with a $10,800 fine after the Australian Competition and Consumer (ACCC) found shoppers could be mislead by the labeling on its “Just Caught Prawn Meat” product.

The ACCC said the packaging showed a prominent image of the Australian flag on its front and back.

A map in the bottom right hand corner included the words “Australian caught raw prawns” printed in a circle around the map, and the packaging also contained the words “Australian Caught-Raw-Deveined-Tail Off-Prawn Meat” noted the West Australian story.

ACCC chairman Rod Sims said the company had been issued an infringement notice because the ACCC had “reasonable grounds” to believe the company had engaged in conduct likely to mislead the public.

“The ACCC believed that the images and statements on this product gave the misleading impression that it was packed and processed in Australia,” he said.

"Businesses cannot rely on fine print disclaimers to correct or qualify a prominent country of origin representation that is false or misleading,” Sims said.

Kailis chief executive Nicholas Kailis said the prawns were caught by Australian fishermen on Australian boats in Australian fishing zones and were sent to Thailand for peeling and processing for cost reasons.

There was no intent to deceive the public, noted Kailis.

Rosella now back on the table with renewed market share

Two years after nearly dropping to less than two per cent of the sauce market, Australia’s oldest sauce brand is on track to increase market share.

2015 marks the 120th anniversary since two men founded the business in a backyard in Carlton, using glass jars to preserve fruits and vegetables throughout its history.

In its 120th year, executive chairman Dan Presser says that Australian families trust and love the brand to ensure that everything is made with the very best quality and the most wholesome ingredients.

Speaking to Food Magazine, Presser said “Australia in the past 40 years has become a far more multicultural country with food and taste influences brought over and integrated into our diets through each wave of new Australians. This has certainly been a large influencer on our tastes.”

Reflecting on the challenges faced as an Australian and family-owned company, Presser believed that Australian consumers had become more discerning in relation to where they spent their money as the range of choices broadens.

Rosella Tomato Sauce or Tomato Soup is essentially timeless: the ingredients put into the products have stayed the same, but the method in which the product is delivered is always set to change –predominantly through supermarkets, petrol stations and convenience stores.’

Returning the brand to its founding mission of using quality local ingredients was one of the first commitments Presser followed through on when family owned company Sabrands purchased Rosella in 2013.

Sabrands is no newcomer to marketing against bigger brands as it already produced Sunraysia and Devondale juice brands before its latest purchase.

Rosella was founded in the late 1800s, with a mission to only use the best of ingredients. It’s about going back to basics, Presser says.

By addressing the key challenge of competing with large multinational companies that have larger financing capabilities with their parent companies in the US, Rosella will attempt to keep up with the current hyper competitive retail environment. 

Australian exports benefiting from Indonesian wheat demands

A significant growth in Indonesia’s demand for the import of meat and produce is set to benefit Australian exporters.

Demand for meat, dairy products and fruit and vegetables have quickly grown as Indonesia’s affluent urban population becomes more integrated within the market.

According to Abares, the Ministry of Agriculture’s commodity forecaster, the market will be worth US$150bn assuming that there are no significant changes to agricultural productivity growths.

“In the case of Indonesia, the current consumption level per person is relatively low. But with income growth, for the future we expect that demand will increase quite significantly over the period to 2050,” the report said.

Indonesia is Australia’s largest export market for wheat, with more than half of Indonesia’s imported wheat (representing 20 per cent of Australia’s total wheat exports) coming from Australia in 2014.

Wheat is the major winter crop grown in Australia with sowing starting in autumn and harvesting, depending on seasonal conditions, occurring in spring and summer. The main producing states are Western Australia, New South Wales, South Australia, Victoria and Queensland.

The majority of Australian wheat is sold overseas with Western Australia the largest exporting state. The major export markets are in the Asian and Middle East regions and include Indonesia, Japan, South Korea, Malaysia, Vietnam and Sudan.

Wheat grown for domestic consumption and feedstock is predominately produced on the east coast.

CHOICE spits the dummy over infant formula shortages

Consumer advocacy group CHOICE has provided a list of suggestions that the Federal Government could use to ensure Australian mums have access to infant formula for children under the age of one.

In addition to encouraging parents to report shortages at retailers or supermarkets across the country, CHOICE has called on the government to enforce rules that limit the number of tins that can be brought at one time.

CHOICE media spokesperson’s Kate Browne says the popularity of formula feeding in China has meant that health and quality problems become more commonplace as the middle class has continued to rise.

“Babies under one often need formula for nutrition and for some it’s their only reliable food source. Consumers need protections so they can ensure their babies receive enough nutrients.”

“It’s now time for the Federal Government to act to ensure access to a reliable baby formula supply to protect some of the nation’s youngest and most vulnerable consumers,” Browne said.

In discussing the food shortage with Food Magazine, Browne looked to solutions put forward in Hong Kong and New Zealand that addressed the problem with a range of options –including stockpiling formula in a similar fashion to normal medications. 

Australian Botanical Spirit released with home-grown ingredients

An Australian first has been launched this week with Vantage Australia’s first botanical premium spirit range.

Australia had yet to put out a signature spirit on the map, encouraging Vantage Australia to release a spirit that was reflective of the Aussie outback and drew inspiration from its native flora.

Vantage Australia adds a twist of natural bushfoods to create a blend that blurs the lines between sweet and dry tastes whilst also giving life to old classics.

Both the 700ml bottle and the one litre bottle have Australian inspired artwork, with the latter capturing the iconic Sydney Harbour Bridge and renowned city landscape.

A 1 litre icon series has been created to foster travel retail/duty free sales whilst creating a unique point of interest to drive domestic market sales.

Vantage Australia: The spirit of a Nation is in keeping with consumer sentiment that appreciates spirits of higher quality in the luxury/super-premium categories, offering an exclusively Australian indulgent experience and a growth category for the trade and will be well supported.

Consumers still confused by inadequate organic labelling

New research from the University of Adelaide suggests that food labelling has still been found to be inadequate by consumers trying to make ethical food choices.

According to the National Association for Sustainable Agriculture Australia (NASAA), many products claiming to be ‘organic’ can only be 100 per cent certified if a label is issued by an approved certifier.

NASAA General Manager Ben Copeman said the difference between products labelled ‘certified organic’ and ‘organic’ had confused Australian consumers when buying high quality organic produce.

“Certified organic products carry a certification logo and certification number. This is the customer’s assurance that there is a third party verification of the integrity of every step of the production process, from paddock to plate”

“On the other hand, products that are merely labelled ‘organic’ may not be free of chemical residue or may be fully imported and packaged in Australia, with the ingredients unlikely to be certified to an internationally recognised standard such as the Australian Standard,” Copeman said.

The National Association for Sustainable Agriculture, Australia (NASAA) was formed in 1986 and supports the education of industry and consumers on organic, biodynamic and sustainable agricultural practices, and was Australia’s first organic certifier.

Today, its certification arm, NASAA Certified Organic (NCO), provides certification and inspection services to assist Certified Organic operators access every organic market in the World. 

NCO is the largest certifier of agricultural land in the world. NCO certifies more than 1,000 operations in 13 countries, certifying some 12m ha of agricultural land worldwide.

Fonterra eyes Chinese expansion with appointment of independent director

A new Independent Director, Clinton Dines is set to take up a board position at Fonterra Co-operative Group Limited starting on the 25th November.

In seeking a director with a broad range of talent and depth of business experience, Chairman John Wilson believed Dines’ experience as a senior executive for BHP Billiton in China would assist in managing the complexities of the large business.

“China is one of BHP’s biggest markets. Taking up the role with BHP in 1988, Mr Dines inherited a small trading business of A$20 million. During his tenure the company experienced a sustained period of very strong growth as China’s demand for commodities accelerated dramatically,” Wilson said.

During his time at BHP in China, Dines managed the impacts of global commodity price fluctuations when prices were low and while they were in a boom market within the last seven years.

The company experienced a sustained period of very strong growth as China’s demand for commodities accelerated dramatically.

Dines was also closely involved in one of the earliest joint ventures established in China in 1980, and was then continuously involved in a range of business ventures across a variety fo Chinese industries.

The ability to set up and run investments for a company like Fonterra that is undertaking significant change will be highly welcome as the business aims to further develop its brand in both Chinese and Australian markets, the company said. 

Stella introduces new-look bottle

Stella Artois has announced new packaging for the iconic beer brand.

Australia will be the first on the market to release the new look bottle and packaging, rolling out from the 1st of November, with the new look rolling out around the globe in 2016.

The new bottle design will feature a new shape with higher shoulders an embossed Stella Artois horn.

The white neck label has been refined with the addition of perforation to ensure a cleaner “rip” of the paper.

Drinkers are given two options; “pry off’ for those opening the bottle and pouring the beer into a glass, and ‘tear off’ for those drinking directly from the bottle. Both insuring the paper will not interfere with the drinkers lips.

The six pack and carton packaging will also feature a new photographic style which results in a high-end finish.

Stella Artois say will the packaging might have changed, but the premium larger will remain the same, with its full flavour and clean crisp taste.

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