Fonterra might not be a household name for all Australians, but you’re likely more familiar with the company than you think.
This dairy co-operative, owned by thousands of farming families across New Zealand, supplies ingredients included in many food products around the world. In Australia, its portfolio includes well-known brands such as Mainland, Western Star, Perfect Italiano, Bega and NZMP.
The co-op produces a range of foodstuffs from milk, butter, whole milk powders, cheese, cream cheese and Ultra High Temperature (UHT) products, through to ingredients used in paediatric, medical and active living commodities such as probiotics, advanced proteins, and hydrolysates. Shipping to more than 140 countries globally, the co-op moves approximately 300,000 tonnes of product during its peak months – equating to about 160,000 containers a year, or one shipping container filled every three minutes.
When Fonterra chose to partner with Linde Material Handling Australia in 2009, it was around the same time the co-op was established. Fonterra’s decision was largely influenced by the fact that many dairy organisations within the co-op were already using Linde forklifts, which had proven to be a great choice for the industry.
What started out as a supplier relationship has since evolved into a true partnership, where both companies collaborate to improve efficiency and productivity while still maintaining high safety standards. “Whenever Fonterra looks to innovate, especially in the MHE sphere, but not exclusively, they often turn to us,” says Allan Spackman, Technical Solutions Manager at Linde.
“They were the first customer in the ANZ region to take on Lithium-ION (Li-ION) from Linde, and they’re now one of our biggest Li-ION customers in this region.
“They were our first Linde Automation customer, taking in Automated Guided Vehicles (AGVs) to their Darfield site, and they were our first Linde:Connect Charger customer in this region, too.”
Fonterra, like Linde, are innovators.
“At Linde we pride ourselves as being innovators in our industry, and Fonterra very much align with that,” says Allan. “An example of their innovative spirit is they possess the world’s biggest powdered milk dryer at their Darfield site.
“So, when we present a new innovation to Fonterra, if it has value to them, and offers something they’ve never had before, they’re often open to partnering with us and exploring its potential.”
Fonterra manages 27 distribution centres integrated with manufacturing facilities, along with four standalone large distribution centres across New Zealand – all of which look after exporting their products to the world.
Darfield, one of Fonterra’s newest facilities, mainly focuses on producing whole milk powder and cream cheese. Meanwhile, Clandeboye, one of Fonterra’s founding sites, produces a diverse range of products, including whole milk powder, butter, and cheese – with a particular focus on mozzarella. As the largest producer of natural mozzarella in the Southern Hemisphere, Clandeboye provides enough mozzarella to top an 500 million pizzas annually.
“Linde is incredibly important to Fonterra. It’s been a partnership we’ve had for over 15 years,” says Richard Tyson, General Manager NZ Distribution Centres Fonterra, New Zealand.
“They’ve supported us in our sustainability journey of wanting to decrease emissions by 50.4 per cent by 2030 and transitioning our forklift fleet to electric helps to achieve this, as well as playing a massive role in our automation strategy.”
Fonterra has ambitious plans for automation across its distribution centres, and Linde has a key role in supporting these efforts.
“Linde has been integral in supporting our automation journey at Fonterra; they supported us in bringing our first automation to Darfield – where we’ve had huge success – and we very much look forward to rolling automation out to our other sites,” says Richard.
Spreading efficiency: automating cream cheese distribution
In 2018, while constructing its cream cheese factory at the Darfield site, Fonterra sought a supplier for automated forklifts to operate in the palletising area. Given its strong partnership with Linde, it sought guidance to identify the best solution.
The new factory introduced two distinct work zones:
Inside the factory: A hygiene control zone where food processing takes place that Fonterra refers to as ‘over the red line’. This is where before any workers enter, they must remove their outside clothes and dress in gear that can only be used inside the factory including sanitised overalls, hair and beard nets, glasses, boots and gloves.
In the distribution centre: This is separate to the factory, where palletising of the cream cheese takes place, and is then transported to the cold store section of their warehouse for distribution.
Fonterra, already familiar with Linde’s automated solutions, was drawn to its use of SLAM navigation – Simultaneous Localisation And Mapping – an infrastructure-free way for an AGV to navigate. It also wanted to explore AGVs that were built on standard Linde trucks.
“They were very happy with the Linde product they had in all of their manual operations and didn’t see any reason that couldn’t translate into their automated operations as well,” says Allan.
Matt Smith, Fonterra Plant Manager – Darfield Cream Cheese, explained the company’s decision to partner with Linde.
“We valued our existing relationship and the AGV solution that directly addressed our need to minimise operators crossing the red line.”
For a worker to transport the cream cheese from the palletising area to the cold store, it would involve:
“Crossing the red line” i.e. removing all of their sanitised gear and changing into their outside clothes.
Walking 100m to the distribution centre.
Driving the pallet from the palletising area, 250m down the warehouse to the cold store section.
Driving the forklift 250m back to the palletising area.
Walking the 100m back to the factory.
“Crossing the red line” again i.e. changing into a new set of sanitised PPE, and then going back into the factory to continue with their quality checks.
This process, repeated 80-120 times a day, was inefficient and disrupted quality checks.
Fonterra accepted Linde’s recommendation to install two AGVs, which proved the ideal solution. By managing the cream cheese transport to the cold store, the AGVs saved time, enabling workers to focus on critical quality checks and maintaining the smooth operation of the process line.
Since their installation five years ago, the two AGVs have collectively logged more than 20,000 hours driving pallets back and forth – which has saved Fonterra’s employees from having to do it.
“The AGVs are great from a productivity and safety point of view,” says Matt.
“I know the task is getting done, and I know the products are being put away safely every day in the cold store,
which means I don’t have to worry about my operators interacting with forklifts as much.”
Bruce Hansen, Fonterra National Fleet Manager – Manufacturing and Supply Chain, New Zealand says the relationship has been advantageous to everyone involved.
“There’s been a lot of support and collaboration between Fonterra, Linde and third-party suppliers to get the right outcomes for the business and keep the uptime of our AGVs as high
as possible,” he says.
“From the beginning, the support we’ve received from Linde has been exceptional.
“The AGVs have become a welcome addition to the Fonterra family and are typically the highlight of any
plant tour.”
Working on this project with Fonterra, Linde understood how critical it was for workers to avoid crossing the red line to deal with any AGV errors.
“Every half a per cent of error reduction we achieved throughout the commissioning process made a huge difference to how Fonterra workers get through their day,”says Allan.
“We use a statistical program to inform us how effective our AGVs are, and by the time the machines were fully commissioned, we found that their technical uptime rate was among the best across all Linde’s AGVs globally.”
Today, Fonterra’s AGVs are now used as a benchmark for other AGV projects around the globe.
Powering up with Linde: Connect Charger
The first rollout of the Linde:Connect Charger, a new charge management system from Linde, took place in early 2024 at Fonterra’s Clandeboye site.
This was a trial for Fonterra to see if it’s a viable solution that they could roll out to its other sites, and so far, things are looking good according to Bruce.
“What we’ve seen so far is really positive, and it’s very likely we’ll be installing quite a few more systems in the near future,” he says.
Power limitations at site proved challenging for Fonterra’s operations.
“Many distribution centres were originally built for minimal power use, making electric charging station installations challenging,” says Bruce. “Linde:Connect Charger helps us sidestep significant infrastructure upgrade costs.”
Through regular discussions with Linde, Fonterra identified the opportunity to trial new technology that could address the issue.
The system connects multiple charging stations, enabling them to communicate and prioritise which machines get charged first, or the fastest, by intelligently allocating the right amount of power to each station. For example, if three machines require simultaneous charging, the charger will identify each truck’s requirements, determining which one needs a faster charge, and which one can charge
more gradually.
“Having the option to run the Linde:Connect Charger allows us to charge the fleet efficiently and effectively, and we didn’t have to spend a lot of money to install more electrical infrastructure or upgrade what we had in order to do it,” says Bruce.
“It turned out to be a perfect fit for our application.”
Fonterra’s decision followed thorough research, assessing: required operational uptime; charging time availability; and electrical capacity to support uninterrupted fleet operation.
The warehouse section where the system was installed faced limited power supply.
This solution allowed Fonterra to utilise their existing infrastructure, avoiding costly upgrades. Additionally, it provides data logging, enabling Fonterra to monitor charging schedules and prioritise key machines.
The trial at the Clandeboye site will guide potential rollouts across Fonterra’s 26 other sites.
Continuing a Legendairy Partnership
Fonterra’s Total Cost of Ownership (TCO) model considers many factors including energy consumption and maintenance costs to help the co-op determine which brand fits best for their application.
“Based on working with other MHE brands in the past, we know that we’d rather spend a bit more money up front on a product that is right for us, and that’s a Linde,” says Bruce.
“Linde forklifts and warehouse trucks are very well built with great reliability. For Fonterra, we view Linde as the best brand in the market for safety, technology, and ergonomics – our operators love our Lindes. We know and trust the brand, so it’s a no-brainer.
“I’ve always had a great relationship with the many staff I deal with at Linde.
“Every time I have an issue or challenge, there’s always a solution being offered on the other end, and that’s priceless in my opinion.”
When asked why Linde forklifts are such a seamless fit for Fonterra, Bruce explained why.
“We own our whole fleet, so cost of ownership is a key aspect to selecting the right product for our application,” he said.
“We do try other brands on odd occasions to compare what’s on the market, see how they perform, and ensure that we’re getting the best.
“And time and time again we prove that Linde is top of the bunch, where the reliability and the performance is there.
“You just get so much more flexibility, longevity and reliability with a Linde, and that’s what keeps our operations going so smoothly.”
Across its 27 distribution centres, Fonterra operates a fleet of more than 600 machines, 60 per cent of which are now electric.
“The strong relationship we have with Linde opens up a lot of opportunities for us to explore automation and other new technologies coming through, particularly around safety,” says Bruce.
“We explore and collaborate together to see where these new solutions can fit into our business.
“I also find it’s pretty special for us that we get to access new and exciting technology that’s coming onto the scene, but not yet publicly released.”
Referring to the partnership Fonterra has with Linde, Richard was effusive.
“Linde has been awesome for us,” he said.
“They really partner with us; they evolve with us and it’s a relationship we absolutely see continuing on into the future.”
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