Why Fonterra accepted defeat in the dairy aisle
OPINION: Fonterra's sale of its consumer dairy business to Lactalis is a clear sign of the co-operative’s failure to compete in the branded consumer market.
They are predicting more “ground-breaking scientific and technological advances” from dairy co-op Fonterra’s Food Structure programme that will benefit the economy and help grow the country’s “talent pool” in R&D.
The panel -- professors Allen Foegeding, from North Carolina State University; Erich Windhab, from ETH Switzerland; Jason Stokes at the University of Queensland; and Dérick Rousseau from Canada’s Ryerson University – meets every year to review the science and the progress of Fonterra’s food structure programme.
In a report released after their latest gathering, the scientists say the approach to the mozzarella cheese innovation had “produced an exceptional amount of success”.
The panel is encouraging the co-op to stretch the science further in the pursuit of new value-add products. It says the “scientific approach to mozzarella could be used as a model and directly transferred to other applications, including cream cheese and beverages, with expectations of equal success”.
The approach would include “attracting top international scientists to NZ academic institutions and Fonterra” and looking “outside the box” for innovation to “help ensure world leadership in dairy science”.
Much of the work in the food structure programme is supported by the Transforming the Dairy Value Chain (TDVC) Primary Growth Partnership programme, a seven-year, $170 million project led by commercial partners including DairyNZ and Fonterra and partnered by the Ministry for Primary Industries.
The programme aims to enable the creation of new dairy products, increase onfarm productivity, reduce environmental impacts, and improve agricultural education.
The panel praised Fonterra for its approach, saying it is “impressive to see a company of this magnitude believe in the synergistic relationship that couples sound, basic science and superb training of scientists with targeted economic outcomes”.
Food Structure design programme manager Christina Coker says the co-op’s material science approach in mozzarella was deliberately aimed at “developing a sound knowledge of the link between mozzarella structure, material and functional properties and the process used to make it”.
“Some good work by talented post-grad students, post-docs and Fonterra researchers has made advances that can be applied in future processes.”
Food Structure technical manager Steve Taylor says the co-op is heeding the panel’s advice and using the knowledge gained through the mozzarella work to further develop its creams, cream cheese and beverages.
“This approach has helped us build an integrated research programme that covers engineering and science aspects of making a product with desired performance, including figuring out what drives the performance.”
A strong relationship exists between overseas experts, the co-op’s external research partners and its own scientists.
“Rich discussions at the reviews have helped shape the work being done and the interpretation of results,” Taylor said. “This has been particularly important in areas where Fonterra has less internal expertise and has inspired our researchers.”
That would not have been possible without the TDVC programme, which has “enabled Fonterra to develop the science and innovation we would not otherwise have had the time and/or expertise to do. This gives us more confidence to invest further in mozzarella technology”.
