Why Fonterra accepted defeat in the dairy aisle
OPINION: Fonterra's sale of its consumer dairy business to Lactalis is a clear sign of the co-operative’s failure to compete in the branded consumer market.
FONTERRA HAS told the primary production select committee it is 'broadly supportive' of the DIRA Bill and says it's pivotal to its future.
Heading Fonterra's team at the committee hearing, chairman Sir Henry van der Heyden noted that at a principle level the board thinks it's the right thing for New Zealand, the right thing for the co-op and the right thing for its farmers.
"We're actually quite excited it's finally coming into the back straight, especially around TAF which we think can deliver a hellava lot for New Zealand.
"There is a silent majority of farmers out there who email and phone me every day saying 'Let's get on with it; we've been waiting for this for a long time and we're excited."
Unsurprisingly, one of Fonterra's main points was on TAF, saying it will ensure Fonterra has the stable, permanent capital base it needs to protect itself from future shocks and to invest and grow.
Van der Heyden told the committee "TAF ensures permanent capital – a balance sheet that allows the board to execute strategy that will deliver value for all new Zealanders, the cooperative itself and farmer shareholders."
Most of the changes the co-op had put forward in TAF were of a "technical nature," van der Heyden said. But he noted concerns about "behavioural" provisions in section 109K which he claimed could "impede conduct that is part of operating a well functioning market."
He also voiced concerns about the milk oversight provisions in the bill. "Fonterra's position on the milk price oversight is that we don't think it's necessary, but we can live in that space. The Shareholders Council has a different view. From our perspective we've always had a transparent, robust process in setting the farmgate milk price so we don't see the need for oversight, but we can live with it."
Chief executive Theo Spierings told the committee Fonterra as a co-op was now at a crossroads in respect of where it was going.
Growth during the past ten years had been unprecedented and the organisation was well placed for the future. But nothing could be taken for granted, and the DIRA Bill is seen as a defining moment for Fonterra.
"We welcome the legislation as it enables us to go forward and deliver our strategy. I have viewed Fonterra for about 25 years from the other side of the world as a competitor and I've always regarded it as the envy of the world."
An independent report, prepared for Alliance farmer shareholders is backing the proposed $250 million joint venture investment by Irish company Dawn Meats Group.
Whangarei field service technician, Bryce Dickson has cemented his place in John Deere’s history, becoming the first ever person to win an award for the third time at the annual Australian and New Zealand Technician of the Year Awards, announced at a gala dinner in Brisbane last night.
NZPork has appointed Auckland-based Paul Bucknell as its new chair.
The Government claims to have delivered on its election promise to protect productive farmland from emissions trading scheme (ETS) but red meat farmers aren’t happy.
Foot and Mouth Disease outbreaks could have a detrimental impact on any country's rural sector, as seen in the United Kingdom's 2000 outbreak that saw the compulsory slaughter of over six million animals.
The Ministry for the Environment is joining as a national award sponsor in the Ballance Farm Environment Awards (BFEA from next year).
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