Scare Or No Scare, Customers Have Little Choice But Fonterra

WELLINGTON/SHANGHAI: However much China and other big customers strive to rely less on Fonterra after a global food contamination scare this month - now downscaled to a 'false alarm' - the New Zealand firm's grip on the global dairy trade is unlikely to be loosened.

While many countries such as India, China and the United States produce more milk, New Zealand, a small island nation of 4.5 million people, exports more than 90 percent of its output and controls a third of the global dairy trade. Most of those exports from what is dubbed the 'Saudi Arabia of milk' come from Fonterra Co-operative Group Ltd , which is owned by its 10,500 farmer suppliers.