Apparently not owning the problems...... Global Operating Officer resigns & Christina Zhu may apply or the job .....Christina is the current China president and responsible for the due diligence on the Beingmate investment...... how on earth does she still have a job with Fonterra .... Fon-Terror
The mind boggles.
Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.”
Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine
You look at the business and see what their strategic capabilities (inc the experience with the people they have). They are really good at manufacturing powder and selling it as commodities/ingredients and not very good at consumer products or value add..... They have little ability to generate the capital to become good at the value-add so will stick to the knitting...
time will tell , but going back to predominetly being a commodity producer dooms them to failure in the long run , the chinese factories being built and taken over will eat fonterra lunch over time due to there deeper pockets. fonterra biggest hinderance is there lack of capital and failure to address the issue is there biggest mistake which will lead to there demise over time due to the fact they do not have the capital to grow value add bussiness which is needed to subsidize the milk payout when the milk price drops.
failure by management and failure by govt in not protecting the dairy industry under national security grounds lol really i mean in the nations interest from overseas companies is leading to its demise.
The market appears to have taken heart from the recent announcement and new(?) strategic direction. Rather ironic though inasmuch as future returns from FSF units depends on profits from the value-added activities that Fonterra has either sold or plans to curtail in future.
You look at the business and see what their strategic capabilities (inc the experience with the people they have). They are really good at manufacturing powder and selling it as commodities/ingredients and not very good at consumer products or value add..... They have little ability to generate the capital to become good at the value-add so will stick to the knitting...
There goes the 'national champion'.....
Ingredients are value add of course, always have been. Most of the world's food industry is engaged in manufacturing ingredients of one sort or another. Specialisation. Long time solid earner for NZ dairy companies & we are good at it. Good to see renewed focus on this & food service.
Bega management will be keeping a close eye on the fate of the Lion dairy assets and on Fonterra’s future in Australia in the next few months.
The Kiwi dairy giant has already lost so much milk supply in Australia that it has closed the Dennington plant in Victoria and has others running below capacity
Ingredients are value add of course, always have been. Most of the world's food industry is engaged in manufacturing ingredients of one sort or another. Specialisation. Long time solid earner for NZ dairy companies & we are good at it. Good to see renewed focus on this & food service.
This is true, without commodity's there isn't value added products, these are the ingredients of the value added products (whole milk, whey protein, casein, lactoferrin etc).
Trying to chase/predict markets for value added products can be an expensive and lackluster venture.
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Originally Posted by Southern_Belle
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