Milk price certainty
Westland Milk has reaffirmed its commitment to pay farmer suppliers 10c above Fonterra farm gate milk price for the following two seasons.
But he believes the two pronged approach to development and growth could well be a factor.
Recently the new chief executive of WMP, Toni Brendish, said she is further reviewing staff roles in the holding company and its subsidiaries. She seeks to restore the company to an industry competitive position and warns some staff redundancies are likely. The review is scheduled to be completed by the end of this month.
O’Connor says the two pronged approach of WMP expanding into Canterbury and building a plant to produce high value products was expensive and untimely from an international market perspective.
He hopes that while Brendish does her review the WMP board is looking at its overall strategy. He says they can’t bury their heads in the sand and not answer the tough questions that are going to come from shareholders and other people in the dairy industry.
The present chairman, Matt O’Regan, is due to stand down in March and a new chairman will be elected; the other week a recently elected new director, Sven Koops, resigned for ‘personal reasons’.
O’Connor says the company’s people are its greatest asset and he feels many corporates and co-ops in New Zealand don’t value their people.
“I hope the losses are not on the West Coast where we need every job. The division of the company between Westland and Canterbury in my view was always the wrong one and it presents challenges operationally and culturally. I hope the company can work through that because it’s a great company and we desperately need it to succeed on the West Coast. I offer my support for them in any way I can,” he says.
O’Connor also observes that the season has been bad for dairy farmers and he hopes the company can quickly get back on track. He has always supported WMP and says the Coast made the right decision to set up its own company and not go with Fonterra.
He hopes the slump in milk production does not lead to procurement wars in the dairy industry, such as occurred in the meat industry, to get milk into plants not operating at capacity.
