The New Zealand dairy is planning to allow other dairy companies to sell their products on the globalDairyTrade trading platform.
Along with Arla Foods and FrieslandCampina, Fonterra has been working with other international dairy companies including Murray Goulburn from Australia and California Dairies and DairyAmerica from the US. It also enlisted the help of Boston-based consultancy CRA International.
No outside company has committed to using globalDairyTrade but a draft set of rules has been drawn up to enable multiple sellers to join.
Fonterra said it is seeking feedback from industry. Gary Romano, managing director of Fonterra Trade & Operations said: “globalDairyTrade is releasing the draft rules today so that industry participants and stakeholders have the opportunity to offer suggestions and feedback.
“All parties are keen to be open and transparent so that globalDairyTrade moves to the next phase of its development with continued wide support from the global industry.”
The draft rules are available at www.globaldairytrade.info.
Fonterra claims that expanding globalDairyTrade, adding more global volume, will lead to more reliable price discovery and give it the potential to attract more buyers. This is because the platform will offer products from different geographies, enabling better risk management.
Since its launch in 2008, globalDairyTrade has already developed into an important global trading platform with more than 300 registered bidders from 58 countries. Prices are typically used as a benchmark for dairy importers around the world.
Fonterra is planning to sell more of its own products on globalDairyTrade this year. The dairy processor will offer Milk Protein Concentrate (MPC) and Rennet Casein from the 17 May trading event.