Sharemilkers been squeezed out – MP

So says Labour's spokesperson for Primary Industries, Damien O'Connor.

O'Connor says reports of a huge drop in the number of 50/50 share milkers who have given up hope of one day owning their own farm is concerning. He says the rise of corporate and multi-farm operations means there is no place in these operations for 50/50 sharemilkers.

"This raises the question 'how do we keep on attracting ambitious people into the industry who believe they can purchase their own farm?' Some will now have to have other aspirations."

O'Connor believes the opening farmgate price for milk set by Fonterra at $4.25/kgMS for the 2016-17 season, will again mean a majority of NZ dairy farmers will not make a profit next year -- a huge challenge for the dairy industry.

He hopes the price set by Fonterra is "realistic" and not like the past, when the stated price was seemingly based on what might happen in better times.

"What is needed is a very cautious approach. There are people indicating there might be higher prices and that is giving others false hope. In any event, farmers should be focusing on keeping costs down, especially while the payout is still below the cost of production."

"We are no longer the lowest cost producers of milk. We have to get back or close to that. This crisis will hopefully drive down the cost of production so that dairy farmers can survive tough times."

The Labour MP warns farmers to carefully study the governance proposals being put out by the Fonterra board. He says farmers need to be thinking very carefully about what's being put before them and make sure it is in their long term interests.