9 Apr 2009

Fonterra expands agreement with Middle East company

8:16 am on 9 April 2009

Fonterra has signed a new agreement with an dairy company in Egypt in a bid to increase its share of the Middle East's $350 million processed cheese market.

Arab Dairy Products already packs Fonterra's processed cheese portions sold in the Middle East.

The new agreement will cover the manufacture, packing and marketing of Anchor triangle processed cheese and jar cheese throughout Egypt, and in future will also cover the distribution of Anchor milk powder products.

Fonterra says Arab Dairy is the second-largest cheese producer in Egypt and while it has a large low-cost processing and distribution base, it has agreed to invest $25 million in expanding its capacity.

The dairy giant says the partnership may also present opportunities beyond Egypt.