Ebola epidemic could cost Fonterra $150m
THE head of New Zealand's largest company, Fonterra, says the growing Ebola epidemic could cost the company $150 million.
As African countries locked down their borders in an attempt to control the disease demand was dropping for Fonterra products, chief executive Theo Spierings told TV3's The Nation today.
I've lived in West Africa, and it's very difficult to contain an Ebola virus or whatever virus to a certain region because people are used to travelling, crossing borders.
"So... movements in West Africa become more and more difficult, so that limits movement of food as well, movement of people - people going to the market, doing their groceries - so you see demand really dropping pretty fast.
"And Ebola - the question is can it be contained quickly, but it doesn't feel to me like that it is under control at the moment, and I'm saying it mildly."
He was worried the disease would continue its spread across countries.
"I've lived in West Africa, and it's very difficult to contain an Ebola virus or whatever virus to a certain region because people are used to travelling, crossing borders.
It's a heavily populated region."
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If the market in West Africa slowed down or dropped off that would affect 100,000 tonnes of powder, Mr Spierings said.
"That's about 5 per cent, 6 per cent of our exports. So you talk...$150 million or something like that.
"Those are big consequences, but that's why we are constantly looking around the globe - where are the opportunities?
"Now there's opportunities, for example, in the US, arbitrage opportunities with butter - very high prices. We can come in with our prices. So we use that opportunity."