EU breaks New Zealand butter monopoly

By Chris Mercer

- Last updated on GMT

Related tags International trade European union New zealand

Nearly half the licences to import butter to the EU from New
Zealand will be opened up to new firms, breaking a monopoly held by
the UK subsidiary of dairy group Fonterra.

The European Commission said it would give 45 per cent of import quota to newcomers from next year, after the European Court of Justice ruled this July that the current system was illegal.

The move, which follows lengthy negotiations between EU and New Zealand delegates, opens up the market for New Zealand butter imports.

One firm looking to take advantage may be German group Egenberger, the main complainant in the case.

Previously, licence applications to import New Zealand butter could only be made to UK authorities and all butter was imported by the UK subsidiary of New Zealand dairy co-operative Fonterra.

The group, which still controls New Zealand butter exports, supported the deal to break up the quota.

"The New Zealand government has clearly put a lot of work into this and done a good job in making the best of a lousy situation in our view,"​ said Fiona Cooper-Clarke, Fonterra's general manager for trade strategy.

Fonterra had been anxious for an agreement on import licences in order to safeguard supplies of its Anchor butter brand, which has performed strongly in the UK over the last few years.

It also highlighted some positives from the deal, including a 19 per cent tariff cut for butter imported to the EU under quota and the inclusion of salted as well as unsalted butter in the quota system.

Related topics Markets Butters & Spreads

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