increase font size
Damien O'Connor.
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.
Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.
OPINION: Farmer shareholders of two of New Zealand's largest co-operatives have an important decision to make this month and what they decide could change the landscape of the dairy and meat sectors in New Zealand.
OPINION: As CEO of the Dairy Board in the 1980s I was fortunate to work with a team of experienced and capable executives who made most of the brand investments that created the international consumer business Fonterra inherited. Soprole in Chile was the largest, but there were more than 20 countries where consumer marketing companies were established and Anchor and other brands were successfully launched.
Fonterra has delivered a fifth straight year of record organic milk price for farmer suppliers.
Fonterra says favourable weather conditions supporting pasture growth is boosting milk production.
Like many manufacturers around the world, European agricultural machinery and tractor manufacturers are currently operating in a difficult market environment. But they are heading to the world’s largest agricultural machinery event in Hanover next month with a degree of cautious optimism.
Established in 2021, the John Deere Technician of the Year Awards champion the important contribution parts and service technicians make to the Australian and New Zealand agriculture, construction and forestry industries.
Beef + Lamb New Zealand (B+LNZ) is calling on farmers from all regions to take part in the final season of the Sheep Poo Study aiming to build a clearer picture of how facial eczema (FE) affects farms across New Zealand.
New Zealand is closer to eradicating bovine TB than ever before, but possums remain a threat, says Beef + Lamb New Zealand.
Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.
The ACT Party says media reports that global dairy giant Nestle has withdrawn from the Dairy Methane Action Alliance shows why New Zealand needs to rethink its approach to climate.
