Wednesday, 04 May 2016 08:55

Fonterra’s performance under blowtorch

Written by 
Deputy Prime Minister Bill English. Deputy Prime Minister Bill English.

Deputy Prime Minister Bill English says farmers should not put the blame on Fonterra.

On the co-ops performance, English says during a downturn there is always a temptation to blame; however that's a product of world supply.

"You can't expect Fonterra to be setting the world price."

He is confident that whatever Fonterra is discussing with its shareholders it is helping farmers maintain a cohesive and confident view of the future.

Fonterra is expecting milk production to be lower by 4% this season. English says this allows the co-op to focus on its volume-to-value strategy. More milk is going into higher value products.

Shareholders and the Government would like to think more could have happened sooner, English says.

"But Fonterra has had to deal with this big surge in production over recent years so they are now well geared up with the right attitude to push more volume into high value added products.

"In five years that's how farmers will judge them: on how the co-op has succeeded in turning more milk into high value products."

However, English notes that higher value added products would always be risky investments; Fonterra's product range will always be underpinned by a base load of competitive production of milk powder commodity type products.

More like this

Winston Peters questions Fonterra divestment plan

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.

Editorial: A new era for two co-ops

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.

Should co-op sell its consumer brands?

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.

Featured

'One more push' to eliminate FE

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.

Winston Peters questions Fonterra divestment plan

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.

National

Machinery & Products

New McHale terra drive axle option

Well-known for its Fusion baler wrapper combination, Irish manufacturer McHale has launched an interesting option at the recent Irish Ploughing…

Amazone unveils flagship spreader

With the price of fertiliser still significantly higher than 2024, there is an increased onus on ensuring its spread accurately at…

» Latest Print Issues Online

Milking It

Tough times

OPINION: Dairy industry players are also falling by the wayside as the economic downturn bites around the country.

MSA triumph

OPINION: Methane Science Accord, a farmer-led organisation advocating for zero tax on ruminant methane, will be quietly celebrating its first…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter