Tuesday, 08 May 2012 11:16

Dairy bill pivotal – van der Heyden

Written by 

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."

More like this

Fonterra trims board size

Fonterra’s board has been reduced to nine - comprising six farmer-elected and three appointed directors.

Returns 'not good enough'

Fonterra leaders are making their case for offloading the co-operative's $3 billion consumer business, noting that its return on capital has been nowhere near respectable.

Record milk price!

A record farmgate milk price for Fonterra shareholders is all but confirmed for this season.

Chinese strategy

OPINION: Fonterra may have sold its dairy farms in China but the appetite for collaboration with the country remains strong.

Featured

Massey Research Field Day attracts huge interest

More than 200 people turned out on Thursday, November 21 to see what progress has been made on one of NZ's biggest and most comprehensive agriculture research programmes on regenerative agriculture.

Expo set to wow again

Stellar speakers, top-notch trade sites, innovation, technology and connections are all on offer at the 2025 East Coast Farming Expo being once again hosted in Wairoa in February.

A year of global challenges

As a guest of the Italian Trade Association, Rural News Group Machinery Editor Mark Daniel took the opportunity to make an early November dash to Bologna to the 46th EIMA exhibition.

National

OSPRI's costly software upgrade

Animal disease management agency OSPRI has announced sweeping governance changes as it seeks to recover from the expensive failure of…

Machinery & Products

BA Pumps expand

Cambridge based BA Pumps & Sprayers, specialists in New Zealand-made spraying equipment, has acquired Tokoroa Engineering’s product range, including the…

Entries open for innovation award

Fieldays and its renowned Innovation Awards are celebrating their 57th year, marking a longstanding tradition in the agricultural calendar, with…

» Latest Print Issues Online

Milking It

Chinese strategy

OPINION: Fonterra may have sold its dairy farms in China but the appetite for collaboration with the country remains strong.

Not fair

OPINION: The Listener's latest piece on winter grazing among Southland dairy farmers leaves much to be desired.

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter