New Zealand dairy firm Fonterra has signed a joint venture partnership with one of India’s largest consumer companies to produce a range of consumer and foodservice dairy products. The deal with Future Consumer Ltd will help Fonterra meet the growing demand for high-quality nutrition in India.
Lukas Paravicini, Fonterra’s chief operating officer of Global Consumer and Foodservice, said the partnership – under the name Fonterra Future Dairy Partners – will enable Fonterra to establish a presence in India.
“It will allow us to prepare the groundwork and make the most of our expertise as we enter the world’s largest and fastest growing dairy industry. Consumer demand for dairy in India over the next seven years is set to increase by 82 billion litres – seven times the forecasted growth for China,” he said. “The partnership will be driven by growth through profitability. The initial stages of the partnership will focus on product development, and marketing with the right capital investment made during this period. The first consumer products will be launched by the middle of 2019, using both locally sourced milk and dairy products from New Zealand.”
Fonterra’s chief for Sri Lanka & Indian Subcontinent, Sunil Sethi, added: “India was also witnessing the emergence of new retail organisations like Future Consumer which has a deep understanding of the Indian consumer, the experience of working with international partners, and a nationwide supply chain and retail network. These dynamics have created an opportunity for this partnership, where we will focus on leveraging our global dairy innovation, manufacturing and nutrition expertise.”
Dairy growth in India is thought to stem from the country’s young population where 70 per cent of people are below 45 years old. Fonterra adds that they are digitally aware, live in urban areas, lead an active lifestyle, have more disposable income, and want to consume higher quality and higher nutritional dairy products.