News briefs: Fonterra, Montec and Danone

Fonterra added-value focus questioned A member of dairy cooperative Fonterra's governance training program claims that the company should steer away from consumer brands to focus instead on commodities and ingredients production, according to press reports.

Les Keeper, who also manages his own dairy in the country, told The Dominion Post newspaper that he believes Fonterra will fail to sufficiently compete with food giants such as Nestle and Danone in the value-added market.

"We should sell the consumer business and invest that money in the supply chain," he was quoted as saying by the publication.

"We have not achieved our targets in this area so we shouldn't keep spending money."

The focus would mean a major turnaround for Fonterra, which has increasingly invested in increasing value in its product by adding ingredients beneficial to health, in order to offset increased commodity costs.

Montec chases dairy demand amongst Chinese children Montec international has this week announced it is extending its portfolio to include production of yoghurt-based drinks for children to target consumer demand for health and wellness products in the Chinese market.

The company says it will manufacturer the yoghurts, which come in four different varieties including a fibre-enriched version, through an existing agreement with the Jinhua Jalo Dairy Company.

The product will be distributed under Montec's 'dairypure' label, which along with its monounsaturated milk product will target a number of cities in the country's Zhejiang Province.

Group managing director Peter Herd said that the launch was not likely to be the last extension of the company's portfolio.

"Montec's strategy has always been to leverage the 'dairypure' brand beyond plain and flavoured milk," he stated.

"In due course we expect to launch other premium products including ice cream."

Danone steps up Romanian investment Danone has set aside a further €1.5m to invest in its Romanian operations, according to local press sources.

Radu Baitos, the company's production manager in the country, told the Romanian national press agency that it had been forced to up its spending to ensure it could keep up with demand on the market for its products.