By PHILIPPA STEVENSON agricultural editor
Newly allied global dairy companies Fonterra and Nestle intend standing shoulder to shoulder in the Americas, but the new partners went nose to nose this week.
A ceremony led by Tainui kaumatua at Fonterra's Auckland headquarters on Thursday ended with a hongi between Fonterra chairman John
Roadley and Nestle executive vice-president Carlos Represas.
Represas, a Mexican, who indicated in asides to Fonterra executives that at times he had doubted agreement could be reached between the companies, was delighted by the occasion.
Talks began between the two more than two years ago.
A carved model of a Tainui waka which was presented to him will be displayed in Nestle's Swiss head office, Represas said.
He told Weekend Business that he expected the new alliance between two organisations, which have shown their commitment to the dairy industry and its development, to last a long time.
It was an alliance of equals, he said, and its objective was to concentrate on the development of chilled dairy products, including beverages, and the production of milk for them.
Fonterra brought to the deal a world-recognised competence and excellence in everything to do with animal husbandry and the production and transport of milk.
Nestle, which was not vertically integrated, had no expertise in those areas, he said.
From its formation companies, New Zealand Dairy Group and Kiwi Dairies, Fonterra also brought to the alliance excellence in milk powder manufacturing, he said.
One of the first targets for a Fonterra/Nestle joint venture company is Argentina, a country in economic crisis.
But Represas said Argentina's crisis matched similar events in Mexico in 1995 and Brazil in 1999.
"I think one of the contributions Nestle brings to the alliance is precisely our knowledge of the Americas, certainly Latin America, and our management of crises. So I don't see this as an obstacle."
Represas said Argentina was one of the most competitive places in the world for the production of milk.
"That is a fact which won't be changed by the crisis and may be accelerated by it."
