Fonterra, Bellamy's sign infant formula deal

2 Dec 2015

Fonterra Australia and Bellamy’s Australia have announced plans to enter into a five year, multi-million dollar strategic agreement to manufacture a range of new baby nutritional powders.

Fonterra, Bellamy's sign infant formula deal

Fonterra Australia and Bellamy’s Australia have announced plans to enter into a five year, multi-million dollar strategic agreement to manufacture a range of new baby nutritional powders.

Fonterra Managing Director Oceania Judith Swales said today’s announcement is part of Fonterra’s transformation of its Australian business.

“This is our strategy in action for Australia where we focus on the areas we can win in a highly competitive market to deliver the best returns,” said Swales. “We are actively growing our nutritionals business through strategic partnerships and agreements which will see the Darnum nutritionals plant move towards full capacity.”

“Our Australian business has particular ingredients strengths in cheese, whey and nutritionals, complemented by our strong consumer and foodservice businesses; and today’s announcement with Bellamy’s Australia - one of the fastest growing infant formula companies - reaffirms our strength in nutritionals.”

“The Darnum plant is a leading nutritionals plant in Fonterra’s global network. Leveraging our Fonterra Research and Development Centre in Palmerston North, the largest dairy innovation centre in the southern hemisphere, we will bring innovation to the Darnum plant and the nutritionals market to capture growing demand.”

Bellamy’s is said to be one of the fastest growing infant formula companies with strong brand recognition and expertise in the organic ingredient supply chain. The company has experienced continued growth over many years, and financial year 2014-15 saw it achieve revenue growth of 156 per cent from the year prior. Formula comprises 88 per cent of Bellamy’s sales.

“The proposed multi-million dollar strategic agreement will help support the growth of Bellamy’s Organic in Australia and abroad, and builds on our strong current relationship,” said Swales. “We are also nearing the finalisation of the Darnum joint venture with Beingmate Baby and Child Food Company Ltd following the recent formal approval by Beingmate’s Board and shareholders.”

Fonterra and Bellamy’s said they will work to finalise the proposed arrangements by the end of the year, with the agreement commencing in 2016.