June 3, 2008

Fonterra closes US$235-million dairy deal with China

Fonterra announced that it has closed a US$235-million deal with a Chinese dairy firm, right after the Free Trade Agreement was signed.

Through the deal, Fonterra will supply a multi-national customer with nutritional milk powders in China.

Philip Turner, the company's manager of trade for Asia, said that the deal was commercially very valuable and came just weeks after the signing of New Zealand's Free Trade Agreement with China in April.

Fonterra said the move would generate some NZD300 million (US$235 million) by the end of 2012.

The company also said that the value-added dairy products will be manufactured in New Zealand factories, using New Zealand milk, capital, labour and technology.

China is New Zealand's fourth largest dairy export market.