Fonterra believe raw milk changes a step in the right direction, but concerned by delay

Posted by James Ferre on 22nd August 2008

Fonterra farmers would see the proposed changes to the Raw Milk Regulations as a step towards a more even playing field around competition, but they would be concerned by the timeframe for change, according to said Fonterra Chief Executive Andrew Ferrier.”The key point in the Government release is that our competitors have access to our milk at a cheaper price than we are paying our own farmers. Our farmers will be disappointed that the changes will not be implemented sooner and they will be concerned that the legislation to support the proposed changes is some way off,” he said. “Our farmers are already subsidising overseas companies to set up in New Zealand and they are now being expected to do this for another two years.”

Mr Ferrier said the window of delay would give overseas-owned companies plenty of time to establish their operations at Fonterra farmers’ expense. “Our farmers are currently subsidising these other companies to the tune of 30c/kgMS and this goes straight to their profit line and, in many cases, straight back to their overseas owners,” he advised. “We’ve always said we welcome competition…as long as it is on an even playing field. We compete for milk overseas, but we certainly aren’t subsidised by other local companies.”