1 00:00:00,120 --> 00:00:02,679 Speaker 1: Now, Fonterra is set to invest one hundred and fifty 2 00:00:02,680 --> 00:00:05,040 Speaker 1: million bucks to build a new plant in Southland to 3 00:00:05,080 --> 00:00:09,240 Speaker 1: meet growing demand from Asia. The plant will produce uht cream, 4 00:00:09,320 --> 00:00:11,840 Speaker 1: with demand expected to rise more than four percent every 5 00:00:11,880 --> 00:00:15,000 Speaker 1: single year for the next decade. The chief executive, Miles Hurrell, 6 00:00:15,040 --> 00:00:17,159 Speaker 1: made the announcement in Malaysia today. He's traveling with the 7 00:00:17,160 --> 00:00:20,080 Speaker 1: Prime Minister's delegation as have A Jatam High Miles, Hi, 8 00:00:20,440 --> 00:00:22,759 Speaker 1: this is fantastic stuff. Why do they like the UHTA 9 00:00:22,760 --> 00:00:23,520 Speaker 1: cream so much? 10 00:00:24,600 --> 00:00:26,160 Speaker 2: Yeah, I mean it's been a growing market for us 11 00:00:26,160 --> 00:00:28,640 Speaker 2: for quite some time, mainly on the back of China 12 00:00:28,720 --> 00:00:30,400 Speaker 2: for the last a decade or so. But you know, 13 00:00:30,400 --> 00:00:32,400 Speaker 2: we're reaching to a point where our capacity and the 14 00:00:32,400 --> 00:00:35,000 Speaker 2: waycados are are filling up and so we need to 15 00:00:35,000 --> 00:00:35,479 Speaker 2: invest more. 16 00:00:35,520 --> 00:00:37,240 Speaker 3: So South it's the right thing for us. Yeah. 17 00:00:37,240 --> 00:00:38,960 Speaker 1: And so what's going on here? Because I heard that 18 00:00:39,000 --> 00:00:41,640 Speaker 1: apparently people in Southeast Asia are taking the coconut milk 19 00:00:41,640 --> 00:00:43,200 Speaker 1: out and putting dairyen. Is that what's up? 20 00:00:43,920 --> 00:00:47,040 Speaker 2: Yeah, there has been a move more from the Western 21 00:00:47,080 --> 00:00:49,680 Speaker 2: diet when we've been using our products in the Western 22 00:00:49,680 --> 00:00:52,640 Speaker 2: diet more to sort of in that call of fusion, 23 00:00:52,720 --> 00:00:55,560 Speaker 2: so you know, such as laxa and milk teas. We're 24 00:00:55,560 --> 00:00:58,480 Speaker 2: starting to see our products going to those categories now, 25 00:00:58,880 --> 00:01:01,320 Speaker 2: which is great because of course it's what the traditional 26 00:01:01,720 --> 00:01:04,720 Speaker 2: people in Malaysia and the like are eating, So it 27 00:01:04,760 --> 00:01:06,160 Speaker 2: opens up a new market for us. 28 00:01:06,280 --> 00:01:08,720 Speaker 1: Is there as much demand in places like that as 29 00:01:08,760 --> 00:01:09,559 Speaker 1: there is in China? 30 00:01:10,959 --> 00:01:12,360 Speaker 3: I mean it's off a lower base clearly. 31 00:01:12,400 --> 00:01:14,440 Speaker 2: I mean the China story has been going going as 32 00:01:14,440 --> 00:01:16,120 Speaker 2: a safe sort of five to ten years now, so 33 00:01:16,120 --> 00:01:17,120 Speaker 2: it is growing. 34 00:01:18,440 --> 00:01:20,679 Speaker 3: That's sort of double digit in some in some categories 35 00:01:20,680 --> 00:01:21,000 Speaker 3: for us. 36 00:01:21,319 --> 00:01:23,520 Speaker 2: So we are to see and being in Malaysia this week, 37 00:01:23,560 --> 00:01:24,959 Speaker 2: you know, to see at first ham and hear from 38 00:01:24,959 --> 00:01:26,160 Speaker 2: our customers and partners. 39 00:01:26,680 --> 00:01:28,160 Speaker 3: You know, it's a great market for us. 40 00:01:28,200 --> 00:01:30,559 Speaker 1: And is this a case of you guys hunting out 41 00:01:30,760 --> 00:01:33,600 Speaker 1: alternative markets in order to diversify away from China or 42 00:01:33,600 --> 00:01:34,560 Speaker 1: are they hunting you out? 43 00:01:35,640 --> 00:01:37,440 Speaker 2: Well, it's a combination of both. I mean we've always 44 00:01:37,480 --> 00:01:40,240 Speaker 2: been in the Southeast Asia market, you know, sort of 45 00:01:40,280 --> 00:01:45,119 Speaker 2: for fifty odd years in Malaysia, and you know, it's 46 00:01:45,200 --> 00:01:46,800 Speaker 2: it's just an opportunity for us to sort of grow 47 00:01:46,880 --> 00:01:47,960 Speaker 2: beyond the China's market. 48 00:01:48,080 --> 00:01:50,000 Speaker 3: So you know, it's an end story for us. 49 00:01:50,240 --> 00:01:53,520 Speaker 1: Yeah, it's good, a good move. Okay, So why Edendale. 50 00:01:54,280 --> 00:01:55,920 Speaker 2: Well, there's a blu of surplus cream in that in 51 00:01:55,920 --> 00:01:58,640 Speaker 2: that area. You know, most of our cream capacity in 52 00:01:58,640 --> 00:02:00,960 Speaker 2: the north is field that white. So this is an 53 00:02:01,000 --> 00:02:03,400 Speaker 2: opportunity to sort of turn what maybe you perceived as 54 00:02:03,400 --> 00:02:04,920 Speaker 2: a sort of a commodity end of the cycle for 55 00:02:04,920 --> 00:02:06,720 Speaker 2: some of the cream that we had down there and 56 00:02:06,760 --> 00:02:08,920 Speaker 2: put it into this area. And of course, you know, 57 00:02:08,960 --> 00:02:11,120 Speaker 2: opening up to seventy year old new jobs in the 58 00:02:11,160 --> 00:02:13,680 Speaker 2: area well received as well. I'm sure by that by 59 00:02:13,680 --> 00:02:14,360 Speaker 2: the region. 60 00:02:14,400 --> 00:02:16,880 Speaker 1: Oh, i'd imagine. So yeah, any concerns at all about 61 00:02:16,880 --> 00:02:18,720 Speaker 1: actually finding the workforce. 62 00:02:19,480 --> 00:02:20,200 Speaker 3: No, I don't think so. 63 00:02:20,240 --> 00:02:23,040 Speaker 2: I mean, we've got pretty strong relationships with the unions 64 00:02:23,040 --> 00:02:26,240 Speaker 2: and as a result it get you know, some pretty 65 00:02:26,240 --> 00:02:28,440 Speaker 2: good talent comes through through the pipeline, So I know 66 00:02:28,480 --> 00:02:29,480 Speaker 2: we're not concerned about that. 67 00:02:29,840 --> 00:02:31,919 Speaker 3: You know, we've got a strong pipeline of people coming 68 00:02:31,919 --> 00:02:32,680 Speaker 3: through right across the. 69 00:02:32,600 --> 00:02:36,240 Speaker 1: Country and miles. You know, you're doing this at a 70 00:02:36,280 --> 00:02:39,160 Speaker 1: time when we are talking about so many businesses just 71 00:02:39,200 --> 00:02:41,320 Speaker 1: being unable to cope with the power prices and it 72 00:02:41,360 --> 00:02:43,280 Speaker 1: being part of the reason why they're talking about shutting down. 73 00:02:43,880 --> 00:02:45,120 Speaker 1: Is that a concern for you at all. 74 00:02:46,320 --> 00:02:48,840 Speaker 2: Well, if anything, it sort of reinforces the need to 75 00:02:48,840 --> 00:02:50,680 Speaker 2: continue to add value because on one side, you know, 76 00:02:50,720 --> 00:02:52,880 Speaker 2: your costs continue to go up and you're under pressure, 77 00:02:52,880 --> 00:02:54,760 Speaker 2: so you've got to look for new markets and new 78 00:02:54,800 --> 00:02:58,000 Speaker 2: avenues to grow grow the top line. So you know, 79 00:02:58,000 --> 00:03:00,600 Speaker 2: if anything, it sort of pushes and to that space. 80 00:03:00,600 --> 00:03:02,640 Speaker 2: But we are conscious that you know, the New Zealand 81 00:03:02,639 --> 00:03:04,520 Speaker 2: and the world is not in a great space right now. 82 00:03:04,560 --> 00:03:07,480 Speaker 2: But you know there's confidence for us and in both 83 00:03:07,480 --> 00:03:10,600 Speaker 2: the New Zealand market and in globally. And you know, 84 00:03:10,880 --> 00:03:13,640 Speaker 2: couple this with our announcement last week and start them 85 00:03:14,000 --> 00:03:17,000 Speaker 2: around our ingredients business. You know, it shows that the 86 00:03:17,000 --> 00:03:19,480 Speaker 2: industry is in good shape. And and Fonterra it was 87 00:03:19,480 --> 00:03:20,519 Speaker 2: also a good joke. Yeah. 88 00:03:20,720 --> 00:03:22,840 Speaker 1: Do you think the Power thing is going to resolve itself? 89 00:03:24,960 --> 00:03:28,000 Speaker 2: I think so these things over time have habit of 90 00:03:28,080 --> 00:03:29,919 Speaker 2: is working themselves out. The markets will sort of, you know, 91 00:03:30,000 --> 00:03:31,760 Speaker 2: get back to an equilibrium. But but there's a bit of 92 00:03:31,760 --> 00:03:33,280 Speaker 2: pain on the way through, as we can all see. 93 00:03:33,280 --> 00:03:35,640 Speaker 2: And it's you know, at least it's it's front and 94 00:03:35,680 --> 00:03:38,440 Speaker 2: center now with those and Power and Wellington so hopefully 95 00:03:38,480 --> 00:03:40,680 Speaker 2: they can they can see some change coming through, but 96 00:03:41,320 --> 00:03:43,600 Speaker 2: but you know it's a stress for the industry. 97 00:03:43,400 --> 00:03:44,040 Speaker 3: No question. 98 00:03:44,440 --> 00:03:45,600 Speaker 1: Miles. How's the trip going? 99 00:03:46,840 --> 00:03:49,240 Speaker 2: You're going well, you know, the Prime Minister has been 100 00:03:49,240 --> 00:03:51,240 Speaker 2: out there sort of wave in the new New Zealand flag. 101 00:03:51,640 --> 00:03:54,080 Speaker 2: You know, we're here with with other food and beverage companies. 102 00:03:54,720 --> 00:03:57,600 Speaker 2: There's education, there's tourism, and he's doing a good job 103 00:03:57,640 --> 00:03:59,520 Speaker 2: on that front. But it's been pretty pretty busy. The 104 00:03:59,560 --> 00:04:02,600 Speaker 2: last couple off to South Korea later tonight, so looking 105 00:04:02,600 --> 00:04:03,000 Speaker 2: forward to that. 106 00:04:03,160 --> 00:04:06,040 Speaker 1: You've got to enjoy yourself. Miles really appreciated this. Miles Hurral, 107 00:04:06,560 --> 00:04:08,640 Speaker 1: chief executive of fond Eira, How good is that news 108 00:04:08,640 --> 00:04:12,280 Speaker 1: for Edendaligan. I love it. For more from Heather Duplessy 109 00:04:12,320 --> 00:04:15,160 Speaker 1: Allen Drive, listen live to news Talks the'd be from 110 00:04:15,240 --> 00:04:18,840 Speaker 1: four pm weekdays, or follow the podcast on iHeartRadio.