Article

Posted on 01 Nov 2019

Fonterra Consolidates its Specialty Cheese Making Facilities.

In September 2019, Fonterra announced the consolidation of its specialty cheese making facilities, which will result in the Te Roto factory closure. The company has two specialty cheese manufacturing sites, which are operated by Fonterra Brands New Zealand (FBNZ). While one site is located in Te Roto, the other is in Bridge Street, Eltham. The planned consolidation has resulted in the shutdown of Te Roto site with operations moving to Eltham.

Fonterra Co-operative Group Limited is a New Zealand based multinational dairy co-operative, which is owned by around 10,500 New Zealand farmers. It is a global dairy nutrition company, which is shaping the industry with quality and innovation. The company is responsible for nearly 30% of the world’s dairy exports, with revenue exceeding NZ$17.2 billion. The company was established in October 2001 following the merger of New Zealand Dairy Group and Kiwi Cooperative Dairies with the New Zealand Dairy Board, which were the country’s two largest dairy co-operatives.

With the specialty cheese manufacturing operations going on at two sites, the company has been losing money due to duplication of costs. This step has been taken to consolidate costs and enhance the business of the company, making it possible to grow further in the category.

Specialty cheese refers to the cheese produced in limited quantity, with particular attention towards natural flavours and texture profiles. It differs from artisanal and farmstead cheese. It can be made from all types of milk (cow, sheep, and goat) with added flavours such as herbs, spices, fruits, and nuts. Specialty cheeses enjoy solid sales throughout the year. Within the specialty cheese category, more than 70% of sales are attributed to the ten most popular varieties, which include Cheddar, Mozzarella, Swiss, Feta, Parmesan, Brie, Blue, Gouda, Hispanic, and other flavoured cheeses. With the growth of the food sector and as consumers continue to become more interested in experimenting with new flavours, the demand for the product as a whole will keep growing.

Currently, there are 65 employees working at Fonterra’s Te Roto site. The company is now working through what this announcement holds for the people working for the company and at Te Roto. The planned consolidation has resulted in the generation of 34 new jobs in Eltham, which will be followed by redeployment options to the same. The company will further support the staff to explore other opportunities at other Fonterra sites.

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