Fonterra is offering an additional payment to farmers based on certain achievement levels. Depending on the number of farmers that meet these levels, Fonterra expects the additional payment to farmers to be about 1-2c per kilogram of milk solids (kgMs).
In 2022, Nestlé and Fonterra partnered up to develop a ‘commercially viable net zero carbon emissions dairy farm’. The project aims to reduce carbon emissions by 30% by mid-2027 and reach net-zero carbon emissions in a decade. This initiative will contribute to Nestlé’s goal of reducing emissions by 20% by 2025 and 50% by 2030. The project is set to start with around 50 farms and be scaled up over the next three years.
Under Fonterra’s The Co-operative Difference framework, farmers can receive a 7c (NZ$) per kgMS payment if they meet four ‘achievements’. These achievements include having and implementing an Animal Wellbeing Plan, having a Farm Environment Plan in place, completing a Food Safety Practices and Procedures assessment, and completing the DairyNZ Workplace 360 Assessment.
Farmers can also receive payments of 3c per kgMs for meeting certain milk quality excellence standards for at least 30 days per season. More information about the framework can be found here.
Fonterra CEO Miles Hurrell expressed delight in partnering with Nestlé and acknowledged their support for farmers. Nestlé New Zealand CEO Jennifer Chappell emphasized Nestlé’s commitment to supporting farmers and reducing greenhouse gas emissions.
Nestlé, along with other dairy industry giants, has committed to publicly disclose its methane emissions at COP28. Fonterra, on the other hand, recently unveiled its scope 3 target and has committed to reporting its absolute emissions reductions annually.
