It was already the world’s largest milk processor and dairy exporter and now it wanted to be a globally relevant co-operative, Spierings said.
Growth in demand was forecast to exceed dairy product supply growth by 3% each year in the massive markets of China and India from now until 2020, he said.
India’s forecast compound annual growth rate was 10% and China’s 7%, whereas their supply growth rates were 7% and 4% respectively.
Spierings and chief financial officer Lukas Paravicini have been presenting what they modestly call a Fonterra update to groups of stakeholders, including farmers, investors and analysts.
It is a comprehensive report on strategy, capital investment, product optimisation, market and brand prioritisation, and the progress with milk production hubs in China, Australia, Chile, the European Union, and the United States.
Among other highlights are plans for plant reconfiguration towards ultra-high temperature processing, mozzarella, nutritionals, and cream cheese and away from cheese and casein.
Production of high-volume commodities milk powder, butter, and anhydrous milk fat would be allowed to grow with the market, Spierings said.
Fonterra also wants to focus on five global brands with consistent propositions worldwide. They are Fonterra, New Zealand Milk Products, Anchor, Anlene, and Anmum.
Spierings has reorganised the senior leadership positions to reflect the new multi-hub approach. He has introduced global operations, headed by Robert Spurway, global ingredients, headed by Kelvin Wickham, and international farming, headed temporarily by Henk Bles.
China’s sales dominance for Fonterra would continue to grow, he said.
Spierings forecast that market would take 8b litre-equivalents of Fonterra milk annually by 2020.
Some would come from outside NZ and the mix would include larger proportions of food service and branded products.
This year it is expected to use 4b litre-equivalents, more than three-quarters of which are ingredient sales of NZ origin.
Total worldwide milk intake would be 22b-plus litre-equivalents this year, he said.
The China farms strategy would produce 1b litres of the 8b litres of sales by 2020.
