Tuesday, 21 March 2023 09:55

Securing capital linked to emissions profile

Written by  Sudesh Kissun
Fonterra is making progress in work to transition its manufacturing sites out of coal by 2037. Fonterra is making progress in work to transition its manufacturing sites out of coal by 2037.

Fonterra says securing capital for future growth will depend on how its farmers manage emissions on-farm.

The co-operative plans to start discussions with farmer shareholders "about what a target will look like and how we'll get there".

Chief executive Miles Hurrell says having a target will help secure high value customers, enable the co-op and farmer owners to meet ongoing regulations as well as secure future finance.

Hurrell says there is "a strong pull" coming from customers, consumers and the capital market.

"Our access to the capital will be linked to how we are dealing with emissions on farm," he says.

Fonterra acknowledges making change on-farm is not easy.

Hurrell points out that the co-op currently has 18 methane-reduction projects underway and 30 active trials of potential solutions.

"These activities support us in building a stronger co-op for the future, and we'll be out talking about these topics over the coming months.

"As we've said earlier, we're well positioned to navigate the challenges we're currently seeing, while also looking out to the needs of our customers and consumers in the years ahead.

"This long-term view determines the steps we need to take today to ensure we continue to be a dairy provider of choice and strong co-op for generations to come."

The co-op is also investing in R&D and new technologies to help reduce emissions on-farm.

Projects underway include a new private-public partnership joint venture announced in November, through which Government and partners from across the food and fibre sectors will work together to reduce methane emissions.

Hurrell says the co-op is also making progress in work to transition its manufacturing sites out of coal by 2037.

"At our Waitoa site we're converting one of our boilers to wood biomass.

"Scheduled to be operating later this year, the new boiler will reduce the site's annual emissions by 48,000 tonnes of CO2e, the equivalent of taking 20,000 cars off New Zealand's roads."

More like this

Winston Peters questions Fonterra divestment plan

Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.

Editorial: A new era for two co-ops

OPINION: Farmer shareholders of two of New Zealand's largest co-operatives have an important decision to make this month and what they decide could change the landscape of the dairy and meat sectors in New Zealand.

Should co-op sell its consumer brands?

OPINION: As CEO of the Dairy Board in the 1980s I was fortunate to work with a team of experienced and capable executives who made most of the brand investments that created the international consumer business Fonterra inherited. Soprole in Chile was the largest, but there were more than 20 countries where consumer marketing companies were established and Anchor and other brands were successfully launched.

Featured

'One more push' to eliminate FE

Beef + Lamb New Zealand (B+LNZ) is calling on farmers from all regions to take part in the final season of the Sheep Poo Study aiming to build a clearer picture of how facial eczema (FE) affects farms across New Zealand.

Winston Peters questions Fonterra divestment plan

Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.

National

Machinery & Products

New McHale terra drive axle option

Well-known for its Fusion baler wrapper combination, Irish manufacturer McHale has launched an interesting option at the recent Irish Ploughing…

Amazone unveils flagship spreader

With the price of fertiliser still significantly higher than 2024, there is an increased onus on ensuring its spread accurately at…

» Latest Print Issues Online

Milking It

Tough times

OPINION: Dairy industry players are also falling by the wayside as the economic downturn bites around the country.

MSA triumph

OPINION: Methane Science Accord, a farmer-led organisation advocating for zero tax on ruminant methane, will be quietly celebrating its first…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter