Global Dairy Update January 2020

• Fonterra to streamline Chilean operations.
• Fonterra appoints interim CEO Greater China.
1
Global Dairy
UPDATE
• Monthly production in New Zealand, EU
and US relatively flat on last year. Australia
continues to decline.
• Exports from New Zealand and the EU show
strong growth and increase in monthly
US exports. Australia monthly exports
continue to decline.
• Imports into China continue to grow. Asia,
Latin America and Middle East & Africa
monthly imports down.
• Fonterra’s season-to-date milk collection
across New Zealand reached 909.3 million
kgMS, down 0.5% on last season. Australia
season-to-date milk collection decreased
16.4% to 60.5 million kgMS.
• Fonterra announces MyMilk expansion.
• Working towards a sustainable dairy industry.
Key Dates
29 February 2020
Final Date for Applications to
Supply Fonterra
18 March 2020
FY20 Interim Results
Announcement
20 April 2020
Share Standard Compliance
2019/20 Season
May 2020
FY20 Q3 Business Update
JANUARY 2020

%
%
%%
%
%
%%
Change for December 2019
compared to December 2018
Change for December 2019
compared to December 2018
Change for November 2019
compared to November 2018
Change for November 2019
compared to November 2018
Change for the 12 months
to December 2019
Change for the 12 months
to December 2019
Change for the 12 months
to November 2019
Change for the 12 months
to November 2019
0.73.40.5
6.70.30.3
0.5
0.7
2
OUR MARKETS
Global Production
Monthly production in
New Zealand, EU and
US relatively flat on last
year. Australia continues
to decline
New Zealand milk
production¹ was down
0.5% on a litre basis (up 0.2%
on a milk solids basis) in
December compared to the
same period in the prior year.
Dry and warmer than usual
weather in Waikato and Bay
of Plenty and favourable
rainfall in the South Island
had an impact on December
production figures.
New Zealand milk
production for the 12
months to December was
0.7% lower than the prior
comparable period.
Fonterra collections are
reported for December, see
page 5 for details.
Australia milk
production decreased
3.4% in November compared
to the same period in the
prior year.
Production for the 12 months
to November was down 6.7%
on the previous 12 months.
Challenging farm conditions
continue to impact milk
production this season with
further reductions in the
national herd predicted.
Fonterra collections in
Australia are reported
for December, see page 5
for details.
EU milk production
increased by 0.5% in
November compared to the
same period in the prior year.
Production growth can
be seen from key milk
producing countries such
as Germany (0.4%), France
(1.7%), the Netherlands
(2.8%) and Poland (2.1%).
Winter weather has
been mild so far and is
resulting in continued
production growth.
EU milk production for the
12 months to November was
up 0.3% compared to the
prior period.
US milk production
increased by 0.7% in
December compared to the
same period in the prior year.
December US milk
production continued the
strong growth of September
and October but at a slower
pace. The increase in herd
size and in milk per cow seen
in prior months stalled in
November and December.
Milk production for the 12
months to December was
0.3% higher compared to the
prior period.
NEW ZEALANDAUSTRALIAEUROPEAN UNIONUSA
To view a chart that
illustrates year-on-year
changes in production –
1 New Zealand production is measured in litres.

To view a chart that
illustrates year-on-year
changes in exports –
3
OUR MARKETS
Global Exports
Exports from New Zealand
and the EU show strong
growth and increase in
monthly US exports.
Australia monthly exports
continue to decline
Total New Zealand
dairy exports increased
by 7.8%, or 27,546 MT, in
November compared to
November 2018. This was
primarily driven by WMP
and butter, up a combined
38,052 MT, and partly offset
by a decline in SMP and
AMF, down a combined
10,152  MT.
Exports for the 12 months
to November were up 9.4%,
or 305,409 MT, on the
previous comparable period.
This was primarily driven by
WMP, fluid milk products,
infant formula and SMP, up a
combined 298,597  MT.
EU dairy exports
increased by 8.1%, or
39,086 MT, in October
compared to October 2018.
This was driven by increases
across most products but
primarily butter, cheese, SMP
and whey, up 29,949  MT.
The increase was driven by
butter exports to Morocco
and Indonesia, and cheese
exports to Korea and Japan.
Exports for the 12 months
to October were up 8.3%, or
442,487 MT, on the previous
comparable period. SMP
fluid milk products, butter,
cheese and lactose were the
main drivers of this growth,
up a combined 457,297 MT
US dairy exports
increased 14.5%, or
25,310 MT, in November
compared to the
November 2018 – a six-
month high. The increase
was driven primarily by SMP,
up 21,083 MT. Whey exports
continued to decline as a
result of African Swine fever
and trade tensions.
Exports for the 12 months to
November 2019 were down
7.7%, or 188,293 MT on the
previous comparable period.
The decrease was driven
by whey, SMP, WPC and
lactose, down a combined
188,403  MT.
Exports to China remain
below the prior year for the
17th consecutive month
although the pace of the
decline is slowing.
Australia dairy
exports decreased by
11. 5%, or 8,743 MT, in
November compared to
November 2018. This was
primarily driven by SMP
and infant formula, down a
combined 7,665  MT.
Exports for the 12 months to
November were down 1.0%,
or 7,512MT, on the previous
comparable period.
Declines were recorded
across a broad range of
products with SMP, WMP,
cheese and whey down
55,857 MT but largely offset
by sustained increases in
fluid milk products and infant
formula, up a combined
52,095  MT.
NEW ZEALANDAUSTRALIAEUROPEAN UNIONUSA
%
%
%%
%
%
%%
Change for November 2019
compared to November 2018
Change for November 2019
compared to November 2018
Change for November 2019
compared to November 2018
Change for October 2019
compared to October 2018
Change for the 12 months
to November 2019
Change for the 12 months
to November 2019
Change for the 12 months
to November 2019
Change for the 12 months
to October 2019
14.511.57.8
1.08.37.7
8.1
9.4

To view a chart that
illustrates year-on-year
changes in imports –
4
OUR MARKETS
Global Imports
Imports into China continue
to grow. Asia, Latin America
and Middle East & Africa
monthly imports down
Latin America dairy
import volumes¹
decreased 1.4%, or 2,448  MT,
in October compared to
October 2018. Decreases
in WMP and whey, down a
combined 10,012 MT, were
largely offset by increases
in cheese and WPC, up a
combined 7,956 MT. Brazil
and Mexico were the main
drivers behind WMP and
whey declines.
Imports for the 12 months
to October 2019 were up
39,849 MT compared to the
previous comparable period.
Increases in SMP and fluid
milk products, up a combined
50,176 MT, were partly offset
by decreases in whey and
infant formula, down a
combined 32,396  MT.
Asia (excluding China)
dairy import volumes¹
decreased 7.9% or 32,819  MT,
in October compared to
October 2018. Decreases
were recorded across a broad
range of products with fluid
products, lactose, WMP and
SMP down 27,550  MT.
Imports for the 12 months
to October were up 2.5%, or
121,007 MT, compared to the
previous comparable period.
Growth continued across
a broad range of products
with SMP, fluid milk products
and cheese up a combined
125,569  MT.
Middle East and Africa
dairy import volumes¹
decreased 0.7% or 2,221 MT
in October compared to
October 2018. Decreases
were recorded principally in
fluid milk products and WMP,
down a combined 17,115  MT,
driven mainly by Qatar and
Algeria respectively. This was
partially offset by an increase
in infant formula and SMP to
Nigeria, up 16,864  MT.
Imports for the 12 months to
October were down 2.8%, or
115,047 MT, compared to the
previous comparable period.
Cheese, WMP, butter and
other powders were down a
combined 195,931 MT, partly
offset by a large increase in
infant formula of 122,442  MT.
China dairy import
volumes continued to
increase, up 31,556 MT in
November compared to
November 2018. This is driven
primarily by increases in WMP
from New Zealand, and fluid
milk products, up a combined
29,210  MT.
Imports for the 12 months
to November were up 11.4%,
or 319,070 MT compared to
the previous comparable
period. Strong demand out
of China continued across
all key categories. Fluid milk
products, WMP, SMP and
infant formula were up a
combined 469,153 MT. This
was partially offset by a
continuing decline in whey
imports, down 105,554  MT.
LATIN AMERICAASIAMIDDLE EAST & AFRICACHINA
1 Estimates are included for those countries that have not reported data.
%
%
%%%
%%%
Change for October 2019
compared to October 2018
Change for November 2019
compared to November 2018
Change for October 2019
compared to October 2018
Change for October 2019
compared to October 2018
Change for the 12 months
to October 2019
Change for the 12 months
to November 2019
Change for the 12 months
to October 2019
Change for the 12 months
to October 2019
12.47.91.4
2.52.811.4
0.7
2.1

To view a table that shows our
detailed milk collection in New
Zealand and Australia compared
to the previous season –
%
%
%%
%%%
Season to date
1 July to 31 December
Season to date
1 June to 31 December
Season to date
1 June to 31 December
Season to date
1 June to 31 December
Change for December 2019
compared to December 2018
Change for December 2019
compared to December 2018
Change for December 2019
compared to December 2018
Change for December 2019
compared to December 2018
13.02.22.50.6
16.40.60.40.5
VOLUME M LITRESDAY
JUNJULAUGSEPOCTNOVDECJANFEBMARAPRMAY









5
OUR MARKETS
Fonterra Milk Collection 2019/20 Season
NEW ZEALANDNORTH ISLANDSOUTH ISLANDAUSTRALIA
New Zealand Milk Collection
Fonterra's Australia
collections in December
were 11. 3 million kgMS,
down 13% on December
last season.
Fonterra collections across
Australia for the six months
to 31 December reached
60.5 million kgMS, down
16.4% on the same period
last season.
Fonterra milk collections
continue to be impacted
by challenging seasonal
conditions, high on-farm
input costs, decreased
cow numbers and intense
competition for milk.
North Island milk
collection in December was
106.4 million kgMS, down
2.5% on last December.
Season to date collection
was 564.3 million kgMS,
down 0.4% on last season.
December weather had
some impact on pasture
quality in some northern
regions, however grazing
crops are doing well, and
cow condition remain
very good.
South Island milk
collection in December was
77.6 million kgMS, up 2.2%
on last December.
Season to date collection
was 345 million kgMS, down
0.6% on last season.
Favorable weather conditions
across Canterbury continued,
allowing for excellent pasture
growth rates.
Fonterra's New Zealand
collection for December,
was 184 million kgMS, down
0.6% on the same month
last season.
Season to date collection
was 909.3 million kgMS,
down 0.5% on last season.
Weather throughout
December was varied, with
warm and dry conditions
in the North Island, and
excellent conditions in the
South Island. Season to date
collections are marginally
down on last season.
%

%
%
%
%
%
%
To view more information,
including a snapshot of the
rolling year-to-date results –
%
6
GDT PRICE INDEXNZDUSD SPOT RATE
JAN AUG JAN APR JUN AUG NOV JAN MAR JUN NOV 


,
, 
, 
.
.
.
.
.
PRICE INDEX
NZD  USD
OUR MARKETS
Fonterra Global Dairy Trade Results
Fonterra GDT sales
by destination:
Dairy commodity
prices and New
Zealand dollar trend
Risks to the global economy
reduced through December
as the direction and timing of
Brexit was finally resolved and
a de-escalation in the US-China
trade dispute achieved. This
more positive outlook assisted
the NZD to strengthen to
above USD0.67 by year end.
Fonterra GDT results at
last trading event
21 January 2020:
The next trading event will be held on 4 February 2020. Visit www.globaldairytrade.info for more information.
Change in Fonterra’s
weighted average product
price from previous event
1.9
Fonterra’s weighted
average product price

(USD/MT)
3,468
USD
Fonterra product quantity
sold on GDT
000’ MT
31.8
NORTH ASIA (INCLUDING CHINA)
SOUTH EAST ASIA
MIDDLE EAST AND AFRICA
LATIN AMERICA
OTHER
USD 4,821/MT
2.2
AMF
USD 9,375/MT
4.5
RENNET CASEIN
USD 4,048/MT
0.8
CHEDDAR
USD 3,233/MT
2.6
WMP
USD 3,051/MT
0.0
SMP
USD 4,250/MT
5.5
BUTTER
31,821
MT
LATEST AUCTION
425,279
MT
FINANCIAL
YEAR‑TO‑DATE

Fonterra to streamline
Chilean operations
Fonterra has purchased the
minority interest in Prolesur,
held by Fundación Isabel
Aninat (the Fundación),
as the Co-op looks to
streamline its operations
in Chile.
The Fundación has sold
its 13.6% shareholding
for $29.3 million, which
takes Fonterra’s ownership
of Prolesur from 86.2%
to 99.9%.
Prolesur is a milk processor
in southern Chile which sells
most of its production to
Soprole. Soprole is a leading
consumer branded dairy
company in Chile and is
99.9% owned by Fonterra.
Fonterra CEO AMENA
Kelvin Wickham says this
move will allow Fonterra
to simplify the interface
between Prolesur and
Soprole and take steps
to better integrate the
two businesses.
“Prolesur and Soprole are
both strong businesses
but their recent
performance has been
impacted by challenging
market conditions.
“Having the two more closely
integrated will generate
operating efficiencies across
the supply chain from milk
collection, to processing
and administration.
“It also allows us greater
flexibility as we focus on
realising the best value
for the Co-op from our
businesses in Chile in line
with our new strategy,” says
Mr Wickham.
The remaining 0.1% of
Prolesur’s shares are held
by minority shareholders,
which Fonterra will offer
to purchase at the same
price per share being
paid to the Fundación for
its shareholding.
Fonterra appoints
interim CEO
Greater China
Fonterra is pleased to
appoint Teh-Han Chow as its
interim CEO Greater China .
Fonterra CEO Miles Hurrell
said the creation of this
new role on the Fonterra
Management Team reflects
the importance of the China
market to the Co-op and it
will sit alongside the other
regional CEO roles for
AMENA, Kelvin Wickham,
and APAC, Judith Swales.
“Teh-Han, who is currently
our President NZMP for
Greater China and South
East Asia, has agreed to
take on this responsibility
in an interim capacity
while we work through
the recruitment process
for a permanent CEO
Greater China.
“Teh-Han is a proven food
sector executive, with
extensive experience leading
large organisations across
Consumer and Ingredients
businesses. During his
time at Fonterra he’s
demonstrated his ability to
grow a business by putting
customers front and centre,
which is exactly what our
new operating model
is about.”
Before joining Fonterra in
2015, Teh-Han was the CEO
of Louis Dreyfus in China,
a leading merchant and
processor of agricultural
goods. He was also
Managing Director Greater
China for Simplot, a food and
agribusiness company
Teh-Han Chow, interim Chief
Executive Officer, Greater China
7
Our Performance
1 NZD1.00 = CLP496.887.

Fonterra announces
MyMilk expansion
Fonterra plans to make it
easier for more dairy farmers
to get into their own farms,
and to grow with the Co-op,
by extending its MyMilk
initiative to the North Island.
“Fonterra’s been looking at
ways to make it easier for
farmers to join and grow
in the Co-op, ensuring
our Co-op is strong for
generations to come,”
says Group Director of
Farm Source, Richard Allen.
“One way has been through
MyMilk, a Fonterra-
backed company that’s
helping farmers establish
a foothold in the industry
and ultimately take a stake
in Fonterra.
“After five successful years
in the South Island, we’re
extending MyMilk across the
North Island to allow more
farmers to join the Co-op.
We’re also extending the
initiative to help existing
Fonterra farmers looking to
grow through purchasing
another Fonterra farm.”
MyMilk provides farmers
with a pathway into the
Co-op, by allowing them to
supply MyMilk for up to five
years without buying shares.
It’s great for farmers who
aren’t currently Fonterra
suppliers, but want to be
a part of the New Zealand
co-operative story.
For Southland farmers Don
and Jess Moore, MyMilk has
opened up an opportunity
once beyond their reach.
“We’ve always wanted to
be Fonterra suppliers. It’s
been awesome to have the
opportunity that MyMilk
gives us by providing a
pathway through stepping
from share-milking to farm
ownership. MyMilk is an
opportunity to keep growing
and stay with the Co-op, and
we’re delighted more farming
families will be given that
chance,” says Don Moore.
First launched in 2014 in the
South Island, MyMilk has
quickly gained traction, with
more than 145 dairy farmers
involved over that time
across Southland, Otago
and Canterbury.
Based on a strong belief that
the co-operative model is
the best fit for New Zealand
farmers, MyMilk offers
farmers the ability to supply
milk for up to five seasons
without a requirement to
purchase shares in Fonterra.
MyMilk farmers are required
to meet the same supply
terms and conditions as
Fonterra shareholders with
regards to milk quality,
safety and sustainability,
and have access to many of
the tools and services the
Co-operative offers.
“We know farmers have
choices when they decide
who they supply, and we
want Fonterra to be the
best choice with a strong
sustainable Farmgate Milk
Price, targeted on-farm
support to help farmers
meet new environmental
and climate expectations,
and flexible financial tools
and ways to share-up,” says
Mr Allen.
MyMilk will be available
in the North Island for
supply commencing from
1 June 2020. Eligibility
conditions apply and
MyMilk volumes are limited
to 5% of Fonterra’s total
milk collections.
To discover more about
MyMilk –
Our Co-op
8

Working towards
a sustainable
dairy industry
Whether it's tackling climate
change, cleaning up our
waterways or reducing the
use of plastic packaging,
the New Zealand dairy
industry, and food producers
in general, are grappling
with huge challenges
around sustainability.
Globally, food production
systems are facing a
transformational challenge.
New Zealand dairy farmers
feed around 40 million
people globally today. But
as the world grows, food
producers around the world
will need to find new ways
to feed 10 billion people
by 2050. And we need to
meet these demands while
protecting and restoring
the environment.
This is being driven by
consumers becoming
increasingly discerning when
it comes to the products they
buy and the food they eat.
Recent market research has
found that 75% of millennials
– those aged 20-35 – are
altering their buying habits
with the environment in
mind and 34% of baby
boomers are willing to
change what they buy if it
means purchasing more
sustainable products.
These present unique
challenges for New Zealand
food producers and Fonterra
is no different.
There’s no easy or quick fix.
As a Co-operative,
we’re deeply invested in
New Zealand’s success and
take a long-term view. We’re
a business built from farms
passed down from one
generation to the next, and
that means ensuring the land
and natural bounty of our
country are preserved for
generations to come.
Agriculture depends upon
a stable global climate and
is particularly impacted by
environmental effects. Our
farmers are close to the
land and will feel climate
change hard.
That’s why we’ve put
sustainability at the heart of
our Co-op’s new strategy.
This means doing what’s
right and doing what’s
expected of us for the
long-term.
It means producing dairy
nutrition in a way that cares
for people, animals and the
land, and brings value to
our communities.
This is not only the right
thing to do but has become
increasingly important as
more consumers choose
environmentally-friendly
products.
As a country, New Zealand
has got a head start.
We are already one of the
best and most sustainable
places in the world to
produce milk. Our farmers
can make a litre of milk for
60% fewer emissions than
the global average.
We are known world
over for producing some
of the best food in the
world, and balancing this
production with our green,
clean reputation.
We’ve got innovative people
working to reduce our
environmental impacts, from
cutting water use through
to researching world-leading
science to reduce
greenhouse gas emissions.
But no one can do this alone.
Tackling complex issues like
climate change, improving
biodiversity and freshwater,
and addressing plastic
waste will take a collective
effort by government,
local and regional councils,
the business community,
scientists, iwi, community
groups and consumers.
But by working together
and focusing on ambitious
common goals, the power
of collaboration can
find solutions.
With New Zealand’s
natural environment and
some of the world’s most
efficient farmers, we’re well
positioned to lead change.
We must find ways
to achieve food and
agriculture sustainability
for New Zealand and our
export markets.
Fonterra doesn’t pretend
to have all the answers and
we’ve got a long way to go
on our own sustainability
journey but believe we can
make positive change.
We’ve committed to doing
our bit.
Carolyn Mortland, Fonterra
Director of Sustainability
Our Co-op
9

PRODUCTION
AUSTRALIAAVERAGE
UNITED STATES
NEW ZEALANDEU
DEC JUL JUN MAY MAR FEB JAN SEP NOV OCT AUG APR 
LIQUID MILK M LITRES














EXPORTS
AUSTRALIA
UNITED STATES
NEW ZEALANDEU
AUG JUL JUN APR MAR FEB JAN DEC NOV OCT SEP MAY 
MT s








AVERAGE
IMPORTS
MIDDLE EAST & AFRICALATIN AMERICA
ASIACHINA
JUL JUN APR MAR DEC JAN FEB SEP NOV OCT MAY AUG 
MT s






AVERAGE
10

Supplementary Information
Global Dairy Market
The charts on the right
illustrate the year-on-year
changes in imports, exports
and production for a range of
countries that are important
players in global dairy trade.
The absolute size of
the bars represents the
change in imports, exports
or production, relative
to the same period the
previous year.
Averages are shown where
data is complete for the
regions presented.
NOTE: Data for EU and Australia November; New Zealand and US to December.
NOTE: Data for EU to October; New Zealand, Australia and US to November.
NOTE: Data for Latin America, Asia, Middle East & Africa to October; China to November.
SOURCE: Government milk production statistics/GTIS trade data/Fonterra analysis.

WEIGHTED AVERAGE PRICEQUANTITY SOLD
APR 
MAR 
JAN OCT 
FEB 
JUL 
AUG 
MAY 
SEP 
NOV 
DEC 
JUN 

,
,

,
,

,
,
,
,
,
,

,

,
WEIGHTED AVERAGE PRICE USDMT
QUANTITY SOLD  MT
11

Supplementary Information
Fonterra milk
production
The table on the right
shows Fonterra milk solids
collected in New Zealand
and Australia compared
to the previous season.
MILK COLLECTION
(MILLION KGMS)
DECEMBER
2019
DECEMBER

2018
MONTHLY
CHANGE
SEASON-
TO-DATE
2019/20
SEASON-
TO-DATE
2018/19
SEASON-
TO-DATE
CHANGE
Total Fonterra
New Zealand
184.0185.1(0.6%)909.3913.6(0.5%)
North Island106.4109.2(2.5%)564.3566.6(0.4%)
South Island77.675.92.2%345.0347.0(0.6%)
Fonterra Australia11. 313.0(13.0%)60.572.4(16.4%)
Fonterra GDT results
This table provides more
information on the latest
results, including a snapshot
of the year-to-date results.
LAST TRADING EVENT
(21 JANUARY 2020)
YEAR-TO-DATE

(FROM 1 AUGUST 2019)
Quantity Sold on GDT
(Winning MT)
31,821425,279
Change in Quantity Sold on GDT
over same period last year
18. 1%(1.8%)
Weighted Average Product Price
(USD/MT)
3,4683,380
Change in Weighted Average
Product Price over same period
last year
12. 1%14.7%
Change in Weighted Average
Product Price from previous event
1.9%–
Fonterra GDT results
This chart shows Fonterra
GDT prices and volumes over
the past 12 months.

12
AMF
Anhydrous Milk Fat.
BMP
Butter Milk Powder.
DIRA
Dairy Industry Restructuring
Act 2001 (New Zealand).
Farmgate Milk Price
The price for milk supplied in
New Zealand to Fonterra by
farmer shareholders.
Fluid Products
The Fonterra grouping
of fluid milk products
(skim milk, whole milk
and cream – pasteurised
or UHT processed),
concentrated milk products
(evaporated milk and
sweetened condensed milk)
and yoghurt.
GDT
Global Dairy Trade, the
online provider of the twice
monthly global auctions of
dairy ingredients.
kgMS
Kilogram of milk solids, the
measure of the amount of
fat and protein in the milk
supplied to Fonterra.
MPC
Milk Protein Concentrate.
Non-Reference Products
All dairy products, except
for Reference Products,
produced by the NZ
Ingredients business.
Reference Products
The dairy products used
in the calculation of the
Farmgate Milk Price, which
are currently WMP, SMP,
BMP, butter and AMF.
Glossary
Season
New Zealand: A period
of 12 months to 31 May
in each year.
Australia: A period of
12 months to 30 June
in each year.
SMP
Skim Milk Powder.
WMP
Whole Milk Powder.
WPC
Whey Protein Concentrate