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Fonterra and Bega Cheese Agree to Collaborate in Dairy Industry

Fonterra, a New Zealand-based dairy company, and Bega Cheese, an Australian dairy company, have signed a long-term agreement to strengthen their partnership in the dairy industry. The agreement, announced in February 2021, aims to optimize the use of the existing milk supply chain between the two companies and create new value-added products for customers in both countries and beyond. The collaboration will focus on three main areas: ingredient innovation, international growth, and sustainability.

Ingredient Innovation

One of the key benefits of the Fonterra-Bega agreement is the access to each other`s expertise and technology in dairy processing and product development. For Fonterra, this means leveraging Bega`s experience in making natural cheese and infant formula, as well as its state-of-the-art canning and packaging facility in Victoria. For Bega, this means tapping into Fonterra`s global network of research and development centers, as well as its patented ingredients such as ActiVedge, a natural milk protein concentrate that enhances the texture and nutrition of various food applications, from beverages to bakery products. By combining their strengths, Fonterra and Bega aim to create new products that meet the changing consumer demand for healthy, sustainable, and convenient food options.

International Growth

Another advantage of the Fonterra-Bega partnership is the potential to expand their reach in global markets. Fonterra, as the world`s largest exporter of dairy products, can help Bega access new customers and geographies, especially in Asia and the Middle East, where demand for dairy products is growing rapidly. Bega, on the other hand, can provide Fonterra with a local presence in Australia, where it already owns iconic brands such as Vegemite, Peanut Butter, and Bega Cheese. Moreover, the two companies can explore joint ventures and acquisitions that align with their strategic goals and values, such as reducing carbon emissions, improving animal welfare, and supporting local communities.


Lastly, the Fonterra-Bega agreement highlights the shared commitment of both companies to sustainability, both in terms of environmental stewardship and social responsibility. Fonterra and Bega have set ambitious targets to reduce greenhouse gas emissions, water usage, and waste generation across their operations, as well as to promote biodiversity and regenerative agriculture. They also aim to improve the livelihoods of the farmers who supply them with milk, by providing training, technology, and fair prices. By working together, Fonterra and Bega can accelerate their progress towards a more sustainable and resilient dairy industry, which benefits not only themselves but also the planet and the people.

In conclusion, the Fonterra-Bega agreement represents a positive step towards collaboration and innovation in the dairy industry, amidst the challenges and opportunities of the post-pandemic era. By sharing their resources, knowledge, and values, Fonterra and Bega can create value for their customers, employees, and stakeholders, while contributing to a more sustainable and prosperous future. As consumers seek healthier, tastier, and more ethical food choices, the Fonterra-Bega partnership offers a compelling proposition for the dairy market and beyond.