What Would Synlait Be Worth to Fonterra or a2 Milk?
Speculation of a possible joint move by Fonterra and a2 Milk to buy Synlait raises a much bigger strategic question, says agribusiness expert Dr Nic Lees.
It says the pragmatic approach would give farmers time to move in the right direction without significant economic risks to farms or to the region.
The council has announced while existing intensive farming in some parts of the Manawatu-Wanganui region will require a consent, these will be granted, with the consent's duration depending on the ability of the farm's owner to reduce nitrogen leaching.
Fonterra's managing director cooperative affairs Todd Muller says the council has taken a realistic approach to mitigate economic risks to the region.
"Nobody argues with the need to improve nutrient losses given their potential impact on waterways, but what caused concern was the proposed pace of change and the immediate impact this would have on many farms, as well as the local economy.
"While the council remains committed to its goals to reduce losses, it has also taken into account the fact that farmers need time to adjust. It has also acknowledged that farms are not beginning from a standing start. Our farmers have already put significant effort into reducing losses and with our support, will continue to make good progress."
Muller agreed with comments by council chairman, Bruce Gordon that farmers had done a huge amount in the past decade to reduce their impact in the region, with dairy effluent compliance rate of 93% among the highest in the country and significant planting and fencing undertaken around waterways.
"We have long recognised the effort put in by farmers and advocated consistently on our farmers' behalf. It is important to acknowledge the council's willingness to engage with Fonterra as well as DairyNZ and Federated Farmers, consider our points of view and take it into account when planning implementation of the One Plan. This is a constructive approach and we are confident we can build on it and get the progress council wants towards its nutrient loss goals. Farmers do recognise the need for change and those in the lead are encouraging others to follow.
"We will keep up the effort and our Supply Fonterra programme is designed to keep that effort focused so farmers are clear on loss risks for nutrients, what they can do to address them and how they can measure progress."
