Global Dairy Update January 2021

•Darfield site adds new shift to meet cream cheese demand.
1
Global Dairy
UPDATE
•December production in New Zealand flat
on last year. Australia monthly production
flat. US and EU monthly
production
increased relative to last year.
• New Zealand and Australia exports
increased in November. EU and US
monthly exports down.
•China imports continue to increas
e and
Latin America monthly imports also up.
Decline in Middle East and Africa and
Asia imports.
• Fonterra’s season-to-date New Zealand milk
collection reached 902.8 million kgMS at the
end of December
, down 0.7% on last season.
• Fonterra's Australia milk collection for
December increased 1.3% to 11.4 million kgMS,
but was down 2.2% for the season to date
relative to last season.
•Promising plantain trial looking g
ood for the planet.
Key Dates
28 February 2021
Final Date for Application to
Supply Fonterra
17 March 2021
FY21 Interim Results
Announcement
20 April 2021
Share Standard Compliance
Date for 2020/21 Season
May 2021
FY21 Q3 Business Update
JANUARY 2021

%
%
%%
%
%
%%
Change for December 2020
compared to December 2019
Change for December 2020
compared to December 2019
Change for November 2020
compared to November 2019
Change for November 2020
compared to November 2019
Change for the 12 months
to December 2020
Change for the 12 months
to December 2020
Change for the 12 months
to November 2020
Change for the 12 months
to November 2020
3.10.00.7
3.00.82.1
1.1
0.4
2
OUR MARKETS
Global Production
December production in
New Zealand flat on last
year
. Australia monthly
production flat. US and EU
monthly production
increased relative to last year
New Zealand milk
production¹ was relatively
flat in December compared
to December last year
increasing 0.7% on a litres
b
asis (up 1.0% on a milk
soli
ds basis).
Following a 2.5% drop year-
o
n-year in November driven
by challenging weather
conditions, milk production
g
rowth has improved in
December as milder and
drier weather settled in.
New
Zealand milk
p
roduction for the 12 months
to December was also
relatively flat on last year at
0.4%
higher.
Fonterra collections are
reported for December, see
p
age 5 for details.
Australia milk
production was flat in

November compared to
N
ov ember 2019. Warm and
wet weather co ntinued to
i
mprove pasture growth
through spring though smaller
herds, a drop in fa rm numbers
an
d labour chall enges
impacted milk production
growth. Dairy Australia
expects milk pro duction to
track towards the lower end
of the current 2020/21 growth
range of 1-3%.
Australia milk production for
the 12 months to November
wa
s 3.0% higher than
last year. Fonterra collections
in Australia are reported
for December, see page 5
for details.
EU (including UK) milk
production increased by
1.1 % in November compared
to the same period last year.
The increase in production
was observed across key
producing countries such
as Ireland (up 8.6%), Italy
(2.0%), UK (1.9%) and
Poland (1.5%). This increase
was partially offset by a
continuing decline in France
and Germany.
EU milk production for the
12 months to November was
up by 0.8% compared to the
same period last year.
US milk production
increased by 3.1% in
December compared to the
same period last year.
December saw continued
strong production volumes
as farmers drive higher milk
per cow yields and herd
sizes. There is some concern
that this sustained growth
rate will lead to pressure on
processing capacity during
spring peak.
Milk production for the
12 months to December was
2.1 % higher compared to the
same period last year.
NEW ZEALANDAUSTRALIAEUROPEAN UNION/UKUSA
To view a chart that
illustrates year-on-year
changes in production –
1 New Zealand production is measured in litres.
Note: 2020 production numbers include one extra day of production in February as 2020 was a leap year.

To view a chart that
illustrates year-on-year
changes in exports –
3
OUR MARKETS
Global Exports
New Zealand and Australia
exports increase in
November. EU and US
monthly exports down
Total New Zealand dairy
exports increased by 8.7%,
or 32,823 MT, in November
compared to the same
period last year.
Record volumes of WMP to
China and South East Asia of
31,421 MT led this increase.
This was offset by decreases
in butter and fluid milk
products, down a combined
6,852  MT.
Exports for the 12 months
to November were down by
2.3%, or 81,486 MT, on the
previous comparable period.
This was primarily driven by
butter, infant formula, SMP,
and cheese.
EU (including UK) dairy
exports decreased by 9.5%,
or 49,277 MT, in October
compared to the same
period last year.
This was driven by decreases
in SMP to Saudi Arabia,
infant formula to Hong Kong
and Russia and butter to
the United Arab Emirates
and Morocco.
Exports for the 12 months
to October were up 2.7%, or
152,175 MT, on the previous
comparable period. Fluid
milk products, cheese, butter,
whey and WMP were the
main drivers of this growth,
up a combined 299,504  MT.
It was partially offset by a
large decline in SMP down
163,387  MT.
US dairy exports
decreased 3.1%, or 6,189 MT, in
November compared to the
same period last year.
Exports volumes decreased
for the first time in over a year.
This was led by lower demand
for SMP from South East Asia
and for cheese by Mexico.
Demand for whey from
China continued to increase,
attributable to recovering
hog herds.
Exports for the 12 months
to November 2020 were
up 11. 7%, or 262,870 MT, on
the previous comparable
period driven by SMP, whey
and WPC, up a combined
248,998  MT.
Australia dairy exports
increased by 6.9%, or
4,415 MT, in November
compared to the same
period last year.
This was primarily driven by
increased demand for fluid
milk products and WMP, up
a combined 6,329 MT, and
partially offset by decreases
in infant formula, down
2,306  MT.
Exports for the 12 months
to November were down
2.2%, or 16,430 MT, on the
previous comparable period.
Declines were recorded
across a broad range of
products with infant formula,
cheese, WMP, SMP, down
a combined 35,353  MT,
partially offset by fluid milk
products, up 11,099  MT.
NEW ZEALANDAUSTRALIAEUROPEAN UNION/UKUSA
%
%
%%
%
%
%%
Change for November 2020
compared to November 2019
Change for November 2020
compared to November 2019
Change for November 2020
compared to November 2019
Change for October 2020
compared to October 2019
Change for the 12 months
to November 2020
Change for the 12 months
to November 2020
Change for the 12 months
to November 2020
Change for the 12 months
to October 2020
3.16.98.7
2.22.711.7
9.5
2.3

To view a chart that
illustrates year-on-year
changes in imports –
4
OUR MARKETS
Global Imports
China imports continue to
increase and Latin America
monthly imports also up.
Decline in Middle East and
Africa and Asia imports
Latin America dairy
import volumes¹ increased
2.6%, or 3,941 MT, in October
compared to the same period
last year.
This was driven by higher
volumes of WMP to Brazil
but partly offset by lower
shipments of SMP to Mexico.
Imports for the 12 months to
October were down 2.2%,
or 38,998 MT, compared
to the same period the
previous year.
Decreases were driven
primarily by SMP, infant
formula and butter, down
a combined 58,702 MT and
partly offset by increased
volumes of cheese and WMP.
Asia (excluding China)
dairy import volumes¹
decreased 4.0%, or 15,381  MT,
in October compared to the
same period last year.
Decreases were recorded for
WMP to Vietnam, Hong Kong
and Singapore, and whey to
Indonesia. This was partially
offset by an increase in
cheese to Japan.
Imports for the 12 months to
October were down 3.0%, or
147,838 MT, compared to the
same period the previous year.
Decreases were recorded
across WMP, SMP and
fluid milk products, down a
combined 187,680 MT, and
offset partially by increased
volumes of lactose, up
48,282  MT.
Middle East and Africa
dairy import volumes¹
decreased 12.0%, or
31,383 MT in October 2020
compared to the same period
last year.
Decreases were driven
principally by lower volumes
of infant formula and SMP
to Nigeria and fluid milk
products to Kenya.
Imports for the 12 months
to October 2020 were
down 3.8%, or 149,867  MT,
compared to October last
year driven by decreases in
fluid milk products, infant
formula and cheese, down
a combined 331,774 MT, and
partially offset by increases
in SMP.
China dairy import
volumes increased by 10%,
or 28,565 MT, in November
compared to the same
period last year.
Import volumes of fluid milk
products, up 23,401 MT, from
Germany and New Zealand
continued to increase as
dairy consumption is widely
promoted to boost immunity.
Whey imports were also up
19,739 MT, primarily from the
US as China continues to
rebuild its hog herds using
whey as feed.
Imports for the 12 months to
November were up 10.4%, or
325,647 MT, driven by whey,
fluid milk products, butter
and lactose.
LATIN AMERICAASIAMIDDLE EAST & AFRICACHINA
1 Estimates are included for those countries that have not reported data.
%
%
%%
%
%
%
Change for October 2020
compared to October 2019
Change for November 2020
compared to November 2019
Change for October 2020
compared to October 2019
Change for October 2020
compared to October 2019
Change for the 12 months
to October 2020
Change for the 12 months
to October 2020
Change for the 12 months
to October 2020
10.0
4.02.6
3.03.8
%
Change for the 12 months
to November 2020
10.4
12.0
2.2

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 2020
compared to December 2019
Change for December 2020
compared to December 2019
Change for December 2020
compared to December 2019
Change for December 2020
compared to December 2019
1.30.70.60.7
2.21.00.60.7
VOLUME M LITRESDAY
JUNJULAUGSEPOCTNOVDECJANFEBMARAPRMAY










5
OUR MARKETS
Fonterra Milk Collection
NEW ZEALANDNORTH ISLANDSOUTH ISLANDAUSTRALIA
New Zealand Milk Collection
Fonterra's Australia
collection

in December
was 111.4 million kgMS, a
1.3 % increase on December
last season.
Above average rainfa
ll and
cooler conditions, driven by a
La Niña weather pattern have
assisted milk production
moving into summer.
Season-to-date collections are
down 2.2% on last year due
to an unseasonally wet spring
and lower herd numbers which
hampered milk volumes across
peak months.
North Island milk
collection in December
was 105.8 million kgMS,
down 0.6% on December
last season.
Season-to-date collection
was 560.9 million kgMS,
down 0.6% on last season.
Weather was mixed in
December, with areas
in the top half of the
Island starting with above
average temperatures and
dry conditions, whereas
southern parts were much
wetter than average.
South Island milk
collection in December
was 77.3  million kgMS,
down 0.7% on December
last season.
Season-to-date collection
was 342.0 million kgMS,
down 1.0% on last season.
At the end of November,
season
-to-date collection
was 264.6 million kgMS, 1.1%
behind last season.
Snow fell in some regions
mid-month, followed by a
cold and wet spell for eastern
parts. The upper South
Island also saw some heavy
rain, before more settled
conditions prevailed for most
areas as the month ended.
Fonterra's New Ze
aland
collection for December
was 183.1 million kgMS,
down 0.7% on December
l
ast season.
Season-to-date collection to
t
he end of December was
902.8 million kgMS, down
0.7% on last season.
The poor pasture conditions
experienced in some areas
in early November turned
around with production at
near normal levels by later
in the month. December
saw a wide range of weather
conditions across the
country but indications of
good levels of
supplementary feed
production across most
p
arts of the country.
%
%
%%

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



,

,

, 

.

.

.

.

.
PRICE INDEX
NZD  USD
OUR MARKETS
Fonterra Global Dairy Trade Results
Fonterra GDT sales
by destination:
Dairy commodity
prices and New
Zealand dollar trend
The New Zealand dollar
ap
preciated during November
a
nd December driven by
broad-based US dollar
weakness and supported by
robust commodity prices. By
early January the NZD peaked
above 73 US cents before
settling just below 72 US cents.
Fonterra GDT results at
last trading event
19 January 2021:
The next trading event will be held on 2 February . Visit www.globaldairytrade.info for more information.
Change in Fonterra’s
weighted average product
price from previous event
5.1
Fonterra’s weighted
average product price
(USD/MT)
3,629
USD
Fonterra product quantity
sold on GDT
000’ MT
28.6
NORTH ASIA (INCLUDING CHINA)
SOUTH EAST ASIA
MIDDLE EAST AND AFRICA
LATIN AMERICA
OTHER
USD 3,295/MT
7.3
SMP
USD 3,380/MT
2.2
WMP
USD 4,735/MT
4.6
BUTTER
USD 4,082/MT
0.1
CHEDDAR
USD 5,398/MT
17.3
AMF
28,553
MT
LATEST AUCTION
387,575
MT
FINANCIAL
YEAR‑TO‑DATE
2021

7
Our Performance
Darfield site adds new
shift to meet cream
cheese demand
Strong global demand for
our cream cheese has seen
Fonterra’s Darfield site in
Canterbury hire a full shift
of new recruits as the team
ramps up production.
Cream Cheese Plant
Manager, Blake Aston says,
“We have employed five
new employees for the shift,
and they’ll work alongside
the three other shifts at
the plant.
“The team is seeing
record monthly sales for
cream cheese. Demand is
predominately coming from
China as we continue to see
increased interest in pasture-
fed milk from New Zealand.”
The cream cheese is going
into a range of different
products, from cheese
lollipops to traditional
Chinese pastry like
moon cakes.
“We have great flexibility
here at the plant that
enables us to dial up or down
the firmness and consistency
of cream cheese to meet
customer preference and
the great job our farmers
are doing in delivering top
quality milk,” Mr Blake said.
Mr Blake said that with
COVID-19 bringing
uncertainty to the job
market, it’s great to see that
Fonterra is able to offer new
opportunities for people
looking for work. One of
those new employees is
Liam Fitzgerald, who spent
eight years working as an
international pilot at Air
New Zealand until COVID-19
hit the aviation industry.
“About 15 years ago I worked
for Fonterra at Edgecumbe.
Recently, when my flying
career came to a halt
unexpectedly, I spoke to my
wife about returning to the
dairy industry.
“I grew up rural in
Whakatane and knew the
culture and lifestyle of the
industry would work for us as
we have a young family.
“The opportunity came up
in the cream cheese plant
and having spoken to a few
people I was really excited
to join the team. It’s a
small team but a modern
plant and a cool product
that I’m looking forward to
working with.”
Fonterra's Darfield site
was established in 2012
and employs more than
280 people.
New employee, Liam Fitzgerald and Cream Cheese Plant Manager, Blake Aston

Promising plantain
trial looking good for
the planet
Fonterra and Nestlé are
teaming up with DairyNZ
to expand a promising
plantain trial to help improve
waterways and reduce
on-farm greenhouse gas
(GHG) emissions.
Incorporating certain
varieties of plantain into a
cow’s diet has been shown
to reduce the nitrogen
concentration in their urine,
which can leach through soil
into groundwater. To test the
benefits in local pastures,
DairyNZ has been leading
the Tararua Plantain Project
in the lower North Island,
where farmers have been
growing the leafy herb for
their cows. The Ministry for
Primary Industries is also
involved as a key contributor.
Now, Fonterra and Nestlé
are helping expand the
project further through
additional funding and by
sharing expertise.
“We’re all about finding
ways to ensure Aotearoa
New Zealand has a thriving
environment and a thriving
farming economy,” says
Fonterra’s Director of
On-Farm Excellence
Charlotte Rutherford.
“We can achieve more by
partnering with others, so
it’s great to join forces with
DairyNZ and Nestlé. This
is helping to speed up the
adoption of plantain by
farmers. Ultimately it could
be a real game-changer to
reduce nitrogen from cows
and help mitigate nitrous
oxide emissions.”
The new collaboration is
helping to accelerate uptake
of Ecotain – a blend of
environmentally functional
plantain cultivars developed
by seed company Agricom.
Currently, 50 Tararua farms
have started to use plantain,
through DairyNZ’s Tararua
Plantain Project. With the
funding boost from Fonterra
and Nestlé, it’s expected
these farms and more will
increase the amount they
grow, therefore maximising
the benefits.
Ecotain has been used in
studies by DairyNZ, Agricom,
Lincoln University, Massey
University and AgResearch,
with results showing it can
significantly reduce nitrogen
leaching. Preliminary studies
also show it has the potential
to lower on-farm greenhouse
gas emissions through the
reduction of nitrous oxide,
which is promising news
for farmers.
Nestlé, the world’s largest
food company and a
customer of Fonterra’s, was
keen to be involved in the
Tararua project given the
commitments it has made
around sustainability.
“Working with our suppliers
and others is critical for
achieving Nestlé’s target of
net zero carbon emissions
by 2050. Reducing on-farm
greenhouse gas emissions
and protecting waterways
will help us get there and
we’re pleased to partner with
Fonterra and DairyNZ on
this initiative,” says Nestlé’s
Robert Erhard.
The project also focuses on
improving understanding of
how farmers can implement
Ecotain successfully and
engaging farmers through
workshops, events and a
national farmer network to
extend knowledge.
As the industry good
body representing dairy
farmers, DairyNZ invests
significantly in sustainability
research. DairyNZ’s General
Manager for New Systems
and Competitiveness,
David McCall, says the
dairy sector has a wide
range of work underway
to reduce nitrates entering
waterways and reduce
on-farm emissions.
“The seven-year Tararua
Plantain Project is a flagship
project for the dairy sector.
It is delivering real, tangible
results valued by farmers.
The project has community
at its heart as it seeks water
quality improvements,
while ensuring the dairy
sector continues as an
economic pillar within the
local community.
“It is excellent to have extra
support from Fonterra and
Nestlé within the Tararua
catchment,” says Dr McCall.
Our Co-op
8
To view more information
about the Tararua
Plantain Project –

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







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









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







AVERAGE
9

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/UK and Australia to November; New Zealand and US to December.
NOTE: Data for EU/UK to October; New Zealand, Australia and US to November.
NOTE: Data for Asia, Middle East & Africa and Latin America 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
10

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
2020
DECEMBER

2019
MONTHLY
CHANGE
SEASON-
TO-DATE
2020/21
SEASON-
TO-DATE
2019/20
SEASON-
TO-DATE
CHANGE
Total Fonterra
New Zealand
183.1184.3(0.7%)902.8909.7(0.7%)
North Island105.8106.4(0.6%)560.9564.3(0.6%)
South Island77.377.9(0.7%)342.0345.4(1.0%)
Australia11. 411. 31.3%59.060.3(2.2%)
Fonterra GDT results
This table provides more
information on the latest
results, including a snapshot
of the year-to-date results.
LAST TRADING EVENT
(19 JANUARY 2021)
YEAR-TO-DATE

(FROM 1 AUGUST 2020)
Quantity Sold on GDT
(Winning MT)
28,553387,575
Change in Quantity Sold on GDT
over same period last year
(10.3%)(8.9%)
Weighted Average Product Price
(USD/MT)
3,6293,201
Change in Weighted Average
Product Price over same period
last year
4.7%(5.3%)
Change in Weighted Average
Product Price from previous event
5.1%–
Fonterra GDT results
This chart shows Fonterra
GDT prices and volumes over
the past 12 months.

11
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.
MENA
Middle East – North Africa.
MPC
Milk Protein Concentrate.
Non-Reference Products
All dairy products, except
for Reference Products,
produced by the NZ
Ingredients business.
NZMP
New Zealand Milk Products.
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