Fonterra Suppliers Confident in Mainland Dairy Future
Fonterra's 460 milk suppliers in Australia, who will switch to Lactalis end of this month, are unfazed with the impending change.
Bolger confirmed that since the seismic event they had been in close contact with their teams on the ground in the area, and could confirm that there were no injuries to Fonterra staff or suppliers. He also told the largely farmer based audience that all factories in the organisation were running normally, although some had shut down automatically due to aftershocks, but were now all back on line.
As of Wednesday morning there were 22 farms that were cut-off in the Kaikoura and surrounding district, although best information suggested that the inland route would be open within the next 48 hours. All other farms were getting milked collected on a regular basis.
Today the business were sending an Emergency Response team to the area, a group of hands-on people, to offer practical help to farmers such as milking cows, repairing fences or just helping them to generally sort out their properties, and free them up to spend time with their families.
That same sentiment was being shown by the four Farm Source stores in the region, which were open as usual, acting as a hub for offers of help in conjunction with Federated Farmers, and indeed, sending their own staff out to help on-farm.
Bolger also noted that the Wednesday morning’s GDT result was a positive in these chaotic times, showing a lift of 4.5%. He also noted that a study of buyers over the last few events had shown that China appeared to be coming back on stream, closely followed by South-East Asia, although the Middle East was depressed, no doubt on the back of very low oil prices.
Looking at factors which had caused this apparently steady demand, a drop in production of around 9% in Australia, largely due to poor weather, had be counterbalanced by a rise in output in the US, while Europe was down by around 1%. That drop in the latter region, although looking to be a relatively low number was on the back of a total production of 140 billion litres, compared to our more modest production at home of 20 billion litres
Closer to home production overall was said to be down around 3%, with the Waikato showing a 14%+ deficit on the back of extended periods of rain in October and November.
Closing Bolger looked at the medium term prospects for milk prices and suggested that a growing population, increasing wealth and continuous urbanisation boded well for the future.
