Fonterra’s ‘Good Bacteria’ Adds Value to Yoghurt in South Africa
The idea that certain foods can remedy a variety of illnesses is far from new. However, the increasing attention paid to
the link between diet and health in recent years has led to a rise in the demand for “functional” foods – foods that are
not only nutritious, but actually improve health and wellbeing.
The runaway success in South Africa of a yoghurt launched a few months ago by supermarket chain Woolworths is a vivid
demonstration of this phenomenon – and an equally vivid demonstration of how close Fonterra is to the leading edge of
this new-wave technology.
The yoghurt contains probiotics first isolated by Fonterra’s research and development team and now manufactured under
licence by Danish ingredients company, Danisco. Probiotics are lactic acid bacteria that are believed to boost the
immune system when eaten regularly.
Dairy category manager for Woolworth’s South Africa, Chris Botha, says the yoghurt’s launch was the most successful
Woolworths has ever had, with 2003 yoghurt sales up 52% on 2002.
Woolworths’ deal with Danisco gives it exclusive rights to Danisco’s HOWARU trademark. HOWARU is the name given by the
Danish company to the cultures discovered at Fonterra Palmerston North.
For Woolworths, the yoghurt is a continuation of the company’s Good Food Journey, a strategy to increase its range of
house-branded functional foods.
For Fonterra, the product’s success shows how rapidly the market for health-driven innovations is growing.
“In this environment, choosing the right ingredients is crucial for manufacturers to succeed,” said Patrick Geals,
general manager of Fonterra’s Health & Nutritional Solutions group.
Health & Nutritional Solutions manages the relationship with Danisco, one of several licensing agreements allowing overseas
companies to commercialise products developed by Fonterra Marketing & Innovation.
“The work being done by Fonterra’s Marketing & Innovation team in isolating health-enhancing ingredients in milk gives us the opportunity to develop close alliances
with our key customers around the world,” Geals said.
Marketing & Innovation director Bob Major said the deal with Danisco illustrated Fonterra’s two-pronged approach to research and
development.
“Some of our work is driven by requests from our customers for a particular type of product, but a lot of our
discoveries come out of our own independent research. Developing products in this way means we are creating new markets
and new customers for our customers. Expanding their business is one way for Fonterra to build our business.”
Pramod Gopal, Fonterra research scientist, led the discovery work on the probiotics. A scientific paper he authored on
the discovery was named the ‘Best Paper of 2000’ by the American National Institute of Health, which is judged by top
United States health journal editors.