Lactalis in front to acquire Fonterra’s Australian dairy assets after ACCC clearance
The world's largest dairy company may be in pole position to acquire Fonterra's Australian assets.
The Dairy Industry Restructuring Act (DIRA) appears to be preventing Fonterra from effectively managing some aspects of its farmers’ environmental performance, says a discussion document from MPI.
DIRA may also be no longer fit for purpose, in that it provides access to regulated milk for large dairy processors “for whom it may no longer be necessary”.
However, DIRA remains relevant and effective at achieving its core objective of managing Fonterra’s dominance, and was unlikely to be encouraging inefficient industry growth or preventing Fonterra from pursuing a value-add strategy.
MPI says those were its preliminary findings after consulting industry stakeholders in the first stage of a major review of DIRA launched in May.
Agriculture Minister Damien O’Connor released the document at a ceremony on a dairy farm at Outram, Otago, to mark the start of wider public consultation.
O’Connor said our biggest and most important export sector must be fit for the future.
“It’s timely to take a strategic view of the challenges and opportunities facing the nearly $17 billion dairy sector.”
“A productive and sustainable dairy sector that grows value and protects the natural resources it depends upon is vital to our economic prosperity and the wellbeing of all New Zealanders.”
O’Connor said DIRA, which led to the setting up of Fonterra in 2001, regulates the co-op’s dominance in the market to protect the long-term interests of all farmers, consumers and the wider economy.
“The dairy industry was built on the back of the DIRA legislation and it is a significant driver of the industry’s performance.
“The review is looking at open entry and exit obligations, the farmgate milk price settings, contestability for farmers’ milk, the risks and costs for the sector, and the incentives or disincentives for dairy to move to sustainable, higher-value production and processing.
“We need everyone with an interest in the success of the dairy sector to take part in a frank appraisal of the issues.”
Public submissions are invited until February 8, 2019, after which potential legislative changes will be drawn up to go to Parliament.
The document says key legislative areas are open entry requirements, access to regulated milk for dairy processors, the base milk price calculation and the DIRA review and expiry provisions.
Two butcheries have claimed victory at the 100% New Zealand Bacon & Ham Awards for 2025.
A Taupiri farming company has been convicted and fined $52,500 in the Hamilton District Court for the unlawful discharge of dairy effluent into the environment.
The Climate Change Commission’s 2025 emissions reduction monitoring report reveals steady progress on the reduction of New Zealand’s climate pollution.
Another milestone has been reached in the fight against Mycoplasma bovis with the compensation assistance service being wound up after helping more than 1300 farmers.
The Government’s directive for state farmer Landcorp Farming (trading as Pamu) to lifts its performance is yielding results.
The move to bring bovine TB testing in-house at Ospri officially started this month, as a team of 37 skilled and experienced technicians begin work with the disease eradication agency.
OPINION: Will synthetic milk derail NZ's economy?
OPINION: According to media reports, the eye-watering price of butter has prompted Finance Minister Nicola Willis to ask for a…