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Westland chairman Peter Morrison.
OPINION: With most of New Zealand gripped by recent events in Christchurch, a huge week in our dairy industry passed with little media coverage.
Fonterra farmers celebrated, albeit without popping champagne corks, their co-op returning to profitability as announced in its half-year results. However, Fonterra bosses and shareholders are under no illusion that the co-op is out of the woods.
Over at South Canterbury processor Synlait (and in China), champagne would have been the order of the day: the listed company had just announced another outstanding half-year result.
But it was the small dairy co-op on the West Coast that last week stunned everyone.
In the preceding weekend, Westland chairman Peter Morrison and directors Katie Milne, Andrew MacPherson and Brent Taylor had flown to China. And last Monday night, Morrison signed a deal signalling the likely beginning of the end of NZ’s second-largest dairy co-op.
A photo doing the rounds on social media shows Morrison ready to sign while his grinning directors stand in the background, arms folded. Surprisingly, no signing ceremony photograph was released by Westland.
No one was surprised that Westland is being sold; its 350-odd shareholders are tired and frustrated with the low milk payouts and had been on the market, via the board, looking for buyers.
The sale process started with 25 possible suitors, dwindling to a shortlist before Yili, China’s largest dairy processor, was declared the victor.
Westland hasn’t been sold yet; that decision will be made by shareholders at a special general meeting on July 4.
It will also require High Court approval under section 236 of the New Zealand Companies Act, consent under the Overseas Investment Act and completion of other customary conditions.
Westland’s board met last week with farmer shareholders to explain and ‘sell’ the Yili deal. Some farmers were keen to know if there is a Plan B.
Yili has agreed to match Fonterra’s milk price for the next 10 years. But what happens after that? Will Westland suppliers too far from Fonterra for it to collect their milk be at the mercy of Yili and its dictated milk price?
Over the next three months Westland shareholders will have to mull this and other questions before they consign their co-op to history.
OPINION: There is zero chance that someone who joined Fonterra as a lobbyist, then served as a general manager of Fonterra's nutrient management programme, and sat on the board of Export NZ, a division of lobbyist group Business New Zealand, doesn't understand that local butter (and milk and cheese) prices are set by the international commodity price.
Kiwis love their butter, and that's great because New Zealand produces some of the best butter in the world. But when the price of butter goes up, it's tough for some, particularly when many other grocery staples have also gone up and the heat goes on co-operative Fonterra, the country's main butter maker. Here the co-op explains why butter prices are so high right now.
An A$2 billion bid for Fonterra's Oceania business would be great news, according to Forsyth Barr senior analyst, equities, Matt Montgomerie.
The large 2025 harvest will exacerbate the wine industry's "lingering" supply from recent vintages, New Zealand Winegrowers Chief Executive Philip Gregan told attendees at Grape Days events around the country in June.
A Chinese business leader says Chinese investors are unfairly viewed as potential security risks in New Zealand.
One of New Zealand’s largest fertiliser plants could be forced to shut down for four months as uncertainty looms over gas supply.
Federated Farmers North Canterbury president Bex Green says two public meetings held this week should have made it loud and clear that rural families and businesses are concerned about proposed staffing changes at NZ Police.
The Environmental Protection Authority (EPA) is consulting on a proposal to ban weedkillers containing chlorthal-dimethyl (DCPA).
August 6 marks Farm Worker Appreciation Day, a moment to recognise the dedication and hard mahi of dairy farm workers across Aotearoa - and DairyNZ is taking the opportunity to celebrate the skilled teams working on its two research farms.
OPINION: The Government has been seeking industry feedback on its proposed amendments to a range of Resource Management Act (RMA) national direction instruments.
A Taupo company says it's the first to bring CO₂-powered water heating technology to New Zealand dairy sheds, helping farmers cut energy costs by up to 85%.
OPINION: Sydney has a $12 million milk disposal problem.
OPINION: Canterbury milk processor Synlait's recovery seems to have hit another snag.
