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.
The scheme, to be launched in the 2019-20 season starting June next year, will be branded; global customers and the New Zealand public will see the branding on Fonterra products.
Fonterra chairman John Monaghan told the co-op annual general meeting in Lichfield yesterday that the scheme will bring together existing milk quality, animal welfare and environmental requirements under a single programme.
While farmers with good management practices will be rewarded, those not meeting the minimum standard will incur demerit points.
From next week Farm Source team will be asking farmers about the types of recognition and rewards they would prefer under the proposed scheme.
The programme may include financial incentives for farmers, says Monaghan.
“Once that commercial value is better understood, we will decide whether to expand the programme to include financial incentives,” Monaghan says.
“Either way, there will still be demerits for the small minority of our farmers who do not meet our minimum standards from time to time.”
