Tuesday, 08 May 2012 11:17

Westland wants level playing field

Written by 

WESTLAND MILK Products chief executive Rod Quin says the DIRA Bill as it stands disadvantages his co-operative. But he says he is broadly supportive of it.

Presenting Westland's submission to the primary production select committee, Quin emphasised the need for a level playing field which allowed for genuine competition.

"We see in the bill some aspects which favour Fonterra over other industry processors and we want to see a level playing field."

Quin says Westland, in common with the IDPG, wants the milk price setting done off 'actuals'.

"By that we mean actual product mix, actual prices and actual operating costs. We've seen arguments from Fonterra saying it's driven mainly off prices. I accept they are using actual prices – they are not using actual product mix and they are not using operating costs. It's a very theoretical model they have designed and are implementing but that's not a healthy outcome from our perspective."

Quin submitted that Fonterra's dominance has necessitated DIRA and is reflected in its 'purpose statement'. "But to date DIRA has failed to regulate Fonterra's activities effectively and further direct intervention is required to support the development of a competitive market for farmers milk. The bill must not permit the setting of a base milk price by Fonterra using an 'optimised model' which produces a higher milk price than Fonterra's actual performance. Instead what is required is a base milk price that reflects their actual performance."

Quin posed a question to the Government members on the committee, asking them just what they wanted – one large dominant player or genuine farmgate competition.

"We have struggled with some of the comments in the amendment bill to see what the Government is actually after here. Some parts of the bill appear to give Fonterra a competitive advantage and we are concerned about that.

"It's not a case of Westland saying it wants Fonterra weakened; all we want is a level playing field."

More like this

Westland Milk reports positive season

"I'm more positive now than I was two or three months ago." That's the view of Richard Wyeth, chief executive of Hokitika-based Westland Milk Products (WMP).

Featured

$52,500 fine for effluent mismanagement

A Taupiri farming company has been convicted and fined $52,500 in the Hamilton District Court for the unlawful discharge of dairy effluent into the environment.

Ospri brings Bovine TB testing in-house

The move to bring bovine TB testing in-house at Ospri officially started this month, as a team of 37 skilled and experienced technicians begin work with the disease eradication agency.

National

Machinery & Products

Fliegl offers effluent solutions

Founded in Germany as recently as 1977, today, the Fliegl Group employs more than 1100 workers, offering an expansive range…

» Latest Print Issues Online

Milking It

It's all about economics

OPINION: According to media reports, the eye-watering price of butter has prompted Finance Minister Nicola Willis to ask for a…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter