CEO Resignation, Fonterra Reshuffles Strategy

Recently, New Zealand dairy giant Fonterra announced that Miles Hurrell, who has been at the helm for eight years as CEO, has resigned. The Fonterra board has initiated the selection process, and Miles Hurrell will remain in position until September 2026 to ensure a smooth transition. The last major project led by Miles Hurrell during his tenure was the divestment of consumer goods and related businesses, marking Fonterra’s full transformation into a raw material supplier and technology service provider. Hurrell’s focus on B2B strategies improved Fonterra’s financial performance and led to the company’s revenue in Greater China surpassing NZD 7 billion for the first time. After Hurrell’s departure, industry insiders are closely watching who will continue to execute this strategy.

Eight-Year Tenure

After weeks of speculation about Hurrell’s departure, the official announcement finally came. On March 16, Miles Hurrell formally resigned.

Hurrell has worked at Fonterra for 25 years. In 2018, he was unexpectedly appointed CEO amid financial pressures and a trust crisis with dairy farmers. During his tenure, he led the company to return to profitability and completed a strategic transformation, especially in China, shifting from a “brand owner” to a “B2B nutrition solutions provider,” one of his most notable achievements.

Under Hurrell’s leadership, China became Fonterra’s largest global market, and he implemented sweeping reforms in the Chinese market. In April 2021, Fonterra sold two wholly owned farms in Shanxi Ying County and Hebei Yutian; in June, it announced the sale of two joint ventures with Abbott in Shandong, fully exiting the high-capital livestock farming sector in China. Since 2021, Fonterra has established six application centers and one innovation center in China, covering Wuhan, Shenzhen, Shanghai, and other locations.

In September last year, Fonterra’s FY2025 report showed total revenue of NZD 26 billion, a 15% increase year-over-year. The Greater China region’s revenue exceeded NZD 7 billion for the first time, driven by strong performance in foodservice, raw materials, and other business segments.

Despite Fonterra’s solid performance, Hurrell’s sudden resignation as CEO has sparked industry speculation. “For Hurrell, he realized he had been doing this for eight years and felt that if he wanted to pursue new strategies, it would require several more years of effort. So, he probably thought now was the right time to step down,” said Peter McBride, Chairman of Fonterra, in a recent media interview. “Clearly, he has reflected and considered this for quite some time.”

Before Hurrell’s official departure in September, Fonterra needed to select a successor. Industry insiders speculate that Richard Allen, the current Global Raw Materials Business President, is one of the leading candidates. Notably, Allen previously led Fonterra’s Foodservice business in Greater China from 2016 to 2018 and is one of the few senior global executives with long-term experience in China. During that time, he oversaw Anchor’s professional brand development in China, focusing on high-growth B2B channels such as baking, foodservice, and new tea drinks. Allen’s experience in China provides practical basis for replicating the “China experience” globally after his promotion to Global Raw Materials President in 2025.

Focus on B2B

The execution of the current B2B-focused strategy may be a key consideration for the new CEO.

In 2024, Fonterra announced the divestment of its global consumer goods business, including brands like Anlene, Anmum, and Anchor, retaining only brand rights in Greater China, effectively exiting retail markets and shifting focus entirely to NZMP raw material supply and Anchor professional dairy foodservice, emphasizing high-value B2B channels.

In early March this year, Fonterra announced the latest progress in its global consumer business divestment, selling Mainland Group for NZD 4.22 billion to French dairy giant Lactalis. The sale included three main parts: Fonterra’s global consumer brand business (excluding Greater China) and its consumer brands, its integrated foodservice and raw material businesses in Oceania and Sri Lanka, and its foodservice operations in the Middle East and Africa. The transaction involved over 20 brands, including Anchor, Mainland, Kāpiti, Anlene, Anmum, Fernleaf, Western Star, and Perfect Italiano.

It is noteworthy that China, as one of Fonterra’s most important markets globally, has experienced significant changes in dairy consumption over the past decade. Demand for basic dairy products has declined annually, while imports of cheese, butter, and high-quality whey powder have continued to increase, prompting Fonterra to adjust its business.

Chinese food industry analyst Zhu Danpeng stated, “Fonterra’s focus on B2B strategy is reasonable. The original milk powder and other products do not significantly support its overall revenue or profit. After divesting non-core businesses, it will positively impact Fonterra’s sustainable development, brand effect, and scale effect.”