By Bernard Hickey
Fonterra has announced a free 'Milk for Schools' trial covering 110 schools with 14,000 schools in Northland that will start in the first term of 2012.
Fonterra's new Chief Executive Theo Spierings said he wanted to make milk more available and affordable for New Zealanders.
Fonterra planned eventually to roll out the Milk for Schools programme across all primary schools in New Zealand through 2013.
"Milk is an important building block for good nutrition. We want Kiwi kids to grow up drinking milk because it is good for them," Spierings told a group of school children gathered in a cafe in Fonterra's head office building in Auckland.
" For some New Zealanders this initiative will bring back memories of the government programme which operated in New Zealand primary schools between 1937 and 1967," Spierings said.
Milk would be refrigerated, he said.
"We don't want kis having to drink warm milk in summer like the old days, so we will look at installing refrigerators in schools, and also explore options for recycling the milk packaging," Spierings said.
Results from the Northland trial would be monitored through the first three terms of 2012 before a nationwide programme through 2013.
Spierings said the programme was a "significant investment", but that it would not effect the payout to Fonterra's farmers. Children would be offered 250 ml cartons of fresh plain lite (1.5% fat) milk each day. Spierings said Fonterra had no plans to offer flavoured or sugared milk.
Spierings also said Fonterra was continuing to review the price of milk in New Zealand and would report back its review in the first quarter of 2012.
"Our motivation is to have more New Zealanders drinking more milk because it is important for basic nutrition. To achieve this we have to make it available and affordable," he said.
Spierings said international dairy prices had effectively doubled in the last 18 months, which had increased the cost of milk locally and reduced demand. Milk consumption had traditionally increased 1-2% annually in New Zealand, but the recent price increases had seen consumption fall at a similar rate in recent years.
"We are exploring a range of options to turn around the consumption decline by making milk more consistently affordable and will report back in the first quarter of next year," he said.
Fonterra would also trial milk sales 4 RD1 rural supply stores before looking to roll it out to the remaining 60 stores..
"Initially we will be focusing on smaller towns that don't have supermarkets nearby. From here we can measure the demand and decide whether to roll this out further," he said.
Federated Farmers' Dairy Chairman Willy Leferink said farmers had been briefed on the plans and gave it a sympathetic hearing.
“The commitment to this trial isn’t the actions of a faceless corporate, but comes from the hearts of Fonterra’s 10,500 farmer-shareholders," Leferink said.
He called on the government to help pay for the programme.
"If Government thinks this is a good idea, as we do, then it needs to share the costs with Fonterra and any other dairy company which may join the scheme," he said.
“In the meantime, Federated Farmers will be making strong representations to Fonterra that its trial packaging must clearly state this milk comes from Kiwi dairy farmers."
(Updated with details, quotes, comments from Spierings on payout, comments from Federated Farmers)