September 1, 2026 • 5 mins
Senior Dairy Analyst at Rabobank, discusses Rabobank's Global Dairy Top 20 report.
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Speaker 1 (00:00):
Well, joining us on the country now is Rabobank senior
analyst in dairy and consumer foods out of Melbourne, Michael Harvey.
Speaker 2 (00:08):
Good afternoon, Michael.
Speaker 3 (00:09):
How are you going? Thanks for having me.
Speaker 2 (00:11):
Great to have you on here. Global top 20 report.
Who's leading the way?
Speaker 3 (00:17):
Yeah, look, it's that time of year we do a
bit of an update on the largest dairy companies in
the world based on dairy revenue. So that's an important point.
And it's always worthwhile sort of looking at the bigger
picture and looking at some of the key trends that
that you're seeing happening in the large dairy company in
the world. And certainly there's a couple of notable trends
that we sort of picked up in the report that
we did. And the first one is really the growth
(00:39):
of Lactalis, who are the world's largest dairy company. They've
been quite active in this part of the world, clearly
with the acquisition of the Fonterra assets in this part
of the world. But they've also continued to grow through
acquisition in other regions and other geographies. So that's a
clear trend that you do see. There's a few other
things as well. You look at what's happening in Europe
at the moment, and there's been some very large acquisitions
(01:02):
of cooperatives, and that's certainly something that we're keeping an
eye on in terms of what happens with that industry
moving forward as they start to consolidate potentially amongst themselves.
So that's a key trend. The other one is Saputo,
who are active in this part of the world, particularly
here in Australia, they've been divesting some of their assets
They're exiting Argentina and exiting the UK as well. So
(01:23):
there's a few sort of key trends that are happening
at the big end of town. But ultimately, it's really
about these large dairy companies continuing to evolve their footprints
around the world.
Speaker 2 (01:32):
OK, so we've seen the big move by Lactalis here.
Which one, Terry? What does that say for the future?
Speaker 3 (01:40):
Yeah, well, I mean, clearly Fonterra, the exit out of
Australia is sort of full stop and reset of their business.
And they're still a very large dairy company and one
of the big players in the global market. But, you know,
going back to being focused on a high quality producer
of commodity servicing, food service and ingredient market. So that's
the sort of full stop on that business. But, you know,
(02:00):
Fonterra have obviously moved down the rank table because of that,
but still very much one of the large dairy companies.
So that's one of the notable trends as well.
Speaker 1 (02:09):
Yeah, Fonterra very much shifting towards that ingredients and food service.
Speaker 3 (02:15):
Right, and that is, you know, another trend that you
do see. I mean, there are global dairy companies that
are on the hunt for access to whey because of the,
you know, the booming demand for high protein products in
consumer markets around the world. So that's certainly something, you know,
there's some assets and acquisitions around actually tapping into brands.
And we saw that here in Australia. You know, Denone
(02:36):
have made an acquisition of a company that's got a
high-protein dairy beverage platform called The May Group and the
Rockabee Farms. So there's certainly a global push to try
and find high-quality protein products and weight pools and ingredients
to service those markets, which is strong, right? I mean,
food service markets are a growth platform for all dairy companies,
and that's certainly something Fonterra are focusing on. But there's
(02:57):
no doubt that high-protein platforms are certainly a key strategy
as well.
Speaker 1 (03:03):
How much have we seen that sort of, I guess,
the key drivers change over the last 10 years, say?
Speaker 3 (03:11):
Yeah, it's constantly evolving. There's no doubt about that. And,
you know, corporate activity is ongoing. I mean, even since
we sort of did the cutoff, you know, we talk about,
you know, Lacta have made further acquisitions and Saputo have
made further divestments. So it's constantly moving. And, you know,
you see big trends like, non-dairy players sort of coming
in and out of dairy platforms. You've seen that with
(03:33):
some global FMCGs at times over the decade or so.
You've seen the emergence of China being a bigger player
in the global scene. They've done that through acquisition and
offshore investments as well. So there's constant change and there
are key trends that come and go. But ultimately, it's
about these large dairy companies just looking for the next
(03:53):
opportunity at the moment. It is high-protein products. It's whey protein.
It's ingredients. It's food service channels.
Speaker 2 (04:01):
Is the possibility too big is too big?
Speaker 3 (04:05):
Oh, that's a good point. I mean, that'll be something
to watch with, you know, just given the size of
La Cala. I mean, they've done their business enormously over
a long period of time, largely through acquisition, and they
continue to do it. So that's why they are the
world's largest dairy company. So, you know, there's clearly, you know,
there's benefits that come with scale and global capacity like that.
So it's something to watch out for.
Speaker 1 (04:26):
There was obviously a huge amount of media and public
interest in what happened between Lactalis and Fonterra, but that
seems to have sort of.
Speaker 2 (04:36):
Died away and just everybody getting on with business.
Speaker 3 (04:40):
Yeah, I mean, obviously now complete. I mean, I'm sitting
here in Australia. I mean, that was a transformational sort
of acquisition here in Australia because it does change the
corporate landscape. You know, Fonterra obviously had a big business
in Australia over a long period of time and sort
of exited the market now. So you've got Lactalis, who
are the way we would look at it, the largest
dairy company here in Australia. So they've got a lot
(05:01):
more scale. They've got a lot more market power with
the retailers. So there's some, you know, there's some things
there that are happening. So, yeah, that was a significant transaction.
Speaker 2 (05:10):
Great stuff. Michael Harvey, Senior Analyst in Dairy and Consumer.
Speaker 1 (05:13):
Foods out of Rabobank with that Global Top 20 report.
Speaker 2 (05:17):
Thank you for joining us.
Speaker 3 (05:18):
My pleasure.
Speaker 2 (05:18):
Thanks for having me.
Well, joining us on the country now is Rabobank senior
analyst in dairy and consumer foods out of Melbourne, Michael Harvey.
Speaker 2 (00:08):
Good afternoon, Michael.
Speaker 3 (00:09):
How are you going? Thanks for having me.
Speaker 2 (00:11):
Great to have you on here. Global top 20 report.
Who's leading the way?
Speaker 3 (00:17):
Yeah, look, it's that time of year we do a
bit of an update on the largest dairy companies in
the world based on dairy revenue. So that's an important point.
And it's always worthwhile sort of looking at the bigger
picture and looking at some of the key trends that
that you're seeing happening in the large dairy company in
the world. And certainly there's a couple of notable trends
that we sort of picked up in the report that
we did. And the first one is really the growth
(00:39):
of Lactalis, who are the world's largest dairy company. They've
been quite active in this part of the world, clearly
with the acquisition of the Fonterra assets in this part
of the world. But they've also continued to grow through
acquisition in other regions and other geographies. So that's a
clear trend that you do see. There's a few other
things as well. You look at what's happening in Europe
at the moment, and there's been some very large acquisitions
(01:02):
of cooperatives, and that's certainly something that we're keeping an
eye on in terms of what happens with that industry
moving forward as they start to consolidate potentially amongst themselves.
So that's a key trend. The other one is Saputo,
who are active in this part of the world, particularly
here in Australia, they've been divesting some of their assets
They're exiting Argentina and exiting the UK as well. So
(01:23):
there's a few sort of key trends that are happening
at the big end of town. But ultimately, it's really
about these large dairy companies continuing to evolve their footprints
around the world.
Speaker 2 (01:32):
OK, so we've seen the big move by Lactalis here.
Which one, Terry? What does that say for the future?
Speaker 3 (01:40):
Yeah, well, I mean, clearly Fonterra, the exit out of
Australia is sort of full stop and reset of their business.
And they're still a very large dairy company and one
of the big players in the global market. But, you know,
going back to being focused on a high quality producer
of commodity servicing, food service and ingredient market. So that's
the sort of full stop on that business. But, you know,
(02:00):
Fonterra have obviously moved down the rank table because of that,
but still very much one of the large dairy companies.
So that's one of the notable trends as well.
Speaker 1 (02:09):
Yeah, Fonterra very much shifting towards that ingredients and food service.
Speaker 3 (02:15):
Right, and that is, you know, another trend that you
do see. I mean, there are global dairy companies that
are on the hunt for access to whey because of the,
you know, the booming demand for high protein products in
consumer markets around the world. So that's certainly something, you know,
there's some assets and acquisitions around actually tapping into brands.
And we saw that here in Australia. You know, Denone
(02:36):
have made an acquisition of a company that's got a
high-protein dairy beverage platform called The May Group and the
Rockabee Farms. So there's certainly a global push to try
and find high-quality protein products and weight pools and ingredients
to service those markets, which is strong, right? I mean,
food service markets are a growth platform for all dairy companies,
and that's certainly something Fonterra are focusing on. But there's
(02:57):
no doubt that high-protein platforms are certainly a key strategy
as well.
Speaker 1 (03:03):
How much have we seen that sort of, I guess,
the key drivers change over the last 10 years, say?
Speaker 3 (03:11):
Yeah, it's constantly evolving. There's no doubt about that. And,
you know, corporate activity is ongoing. I mean, even since
we sort of did the cutoff, you know, we talk about,
you know, Lacta have made further acquisitions and Saputo have
made further divestments. So it's constantly moving. And, you know,
you see big trends like, non-dairy players sort of coming
in and out of dairy platforms. You've seen that with
(03:33):
some global FMCGs at times over the decade or so.
You've seen the emergence of China being a bigger player
in the global scene. They've done that through acquisition and
offshore investments as well. So there's constant change and there
are key trends that come and go. But ultimately, it's
about these large dairy companies just looking for the next
(03:53):
opportunity at the moment. It is high-protein products. It's whey protein.
It's ingredients. It's food service channels.
Speaker 2 (04:01):
Is the possibility too big is too big?
Speaker 3 (04:05):
Oh, that's a good point. I mean, that'll be something
to watch with, you know, just given the size of
La Cala. I mean, they've done their business enormously over
a long period of time, largely through acquisition, and they
continue to do it. So that's why they are the
world's largest dairy company. So, you know, there's clearly, you know,
there's benefits that come with scale and global capacity like that.
So it's something to watch out for.
Speaker 1 (04:26):
There was obviously a huge amount of media and public
interest in what happened between Lactalis and Fonterra, but that
seems to have sort of.
Speaker 2 (04:36):
Died away and just everybody getting on with business.
Speaker 3 (04:40):
Yeah, I mean, obviously now complete. I mean, I'm sitting
here in Australia. I mean, that was a transformational sort
of acquisition here in Australia because it does change the
corporate landscape. You know, Fonterra obviously had a big business
in Australia over a long period of time and sort
of exited the market now. So you've got Lactalis, who
are the way we would look at it, the largest
dairy company here in Australia. So they've got a lot
(05:01):
more scale. They've got a lot more market power with
the retailers. So there's some, you know, there's some things
there that are happening. So, yeah, that was a significant transaction.
Speaker 2 (05:10):
Great stuff. Michael Harvey, Senior Analyst in Dairy and Consumer.
Speaker 1 (05:13):
Foods out of Rabobank with that Global Top 20 report.
Speaker 2 (05:17):
Thank you for joining us.
Speaker 3 (05:18):
My pleasure.
Speaker 2 (05:18):
Thanks for having me.
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