increase font size
Lukas Paravacini.
Fonterra says its decision to delay payments to some creditors by up to 90 days is nothing new and suppliers should "align" themselves to it.
Only 2000 of its 18,000 suppliers are affected, says chief financial officer Lukas Paravacini.
"We are aligning to a payment condition that always existed, and people should expect in [this time of low payout] to very quickly align.
"We are very conscious of the role we play in the community beyond our farmers. This [slow payment] touches roughly 2000 of the 18000 suppliers; we are not touching 16,000 of them because we understand the impact that will have."
Fonterra has extended by two months the time it takes to pay suppliers, from 30 to 90 days, saying this matches what it does in other countries.
It has also asked some suppliers to cut their charges by up to 20%.
A backlash by some businesses has prompted the Green Party to ask the Government to intervene; the party accuses Fonterra of using its size to bully its suppliers and contractors in rural areas.
Meanwhile, Fonterra will give an update of its debt level on March 23 when it presents half-year results.
Last year the co-op said its gearing ratio rose to 49.7% from 42.3% a year earlier, but was 46.4% when adjusted for a $900 million advance payment to farmers. The co-op formerly aimed for a gearing ratio of 40-45%.
Paravacini says the co-op spent heavily on its New Zealand operations last year. It has since decided not to increase its debt levels.
"We made it clear in our Q1 results that we expect gearing ratio to go to 40-45% by the year's end."
He says Fonterra remains a very sound business.
In the past, much has been made of the concept of farm to fork, but an Australian expert in food science and marketing with experience in the dairy industry, Dr Angeline Achariya, says the reverse of this slogan is critical to win modern day consumers.
A four year trial has reaffirmed that mixing plantain into dairy pastures can help reduce nitrogen losses to freshwater while maintaining milk production and profitability, say researchers.
Fonterra has opened its upgraded Chengdu Application Centre, bringing New Zealand dairy expertise closer to customers in one of China's fastest-growing regions.
Tatua chair Stephen Allen says he leaves the co-op with a deep sense of gratitude for the people who have contributed to its success.
Federated Farmers president Colin Hurst and his family raised a glass of milk last week to toast the start of a new addition to their farming operation at Makihihi, south of Timaru.
Celebrating 50 years in the rural landscape of Central Canterbury and beyond, Ashburton-based Carrfields, has been the exemplar for all aspects of modern agriculture via its extensive range of services including supply, growing, agronomic advice and marketing.
For Taupiri dairy farmers Logan and Sian Dawson, their involvement in the NZ Dairy Industry Awards has been a key catalyst in the growth of their business - the experience helping shape how they approach the farm ownership pathway they are pursuing today.
West Otago dairy farmer Luke Kane has been awarded the 2026 Rabobank Dr John Morris Business Development Prize.
OPINION: As the general election approaches, political parties are churning out policies in the hope of attracting more votes.
An LIC bull, Tronnoco AR Sadio-ET S3F, bred by Tony and Keri O'Connor of Tronnoco Farming Co Ltd near Timaru, has won the 2026 Mahoe Trophy.
With forecasters advising El Niño conditions will develop through winter and strengthen into spring and summer, Ballance Agri-Nutrients is encouraging farmers and growers to think ahead about nutrient planning and be prepared to work around challenging weather conditions.
OPINION: The same mainstream media muppets that brought you Jacindamania in 2017 have been flat out pimping for the Opportunities…
OPINION: Your old mate reckons the atrocious way farmers in the UK are treated by their lords and masters in…
