Friday, March 29, 2024

Fonterra still wants right of refusal for remote milk collection

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Fonterra would continue to push for the right to refuse to collect milk from remote dairy farms, chairman John Wilson has said. He told the Northland Dairy Development Trust annual conference in Whangarei that the final report of the Commerce Commission on the statutory review of the Dairy Industry restructuring Act (DIRA) was due out any day.
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“We believe the Government will have a further consultation process during 2016 and we are certainly not changing our views on the Raw Milk Regulations and the open-entry and exit provisions.”

Fonterra’s position as manufacturer of first and last resort for every person who wanted to go dairying resulted in very inefficient use of capital, which shareholders paid for.

“In today’s world where we want to be adding value to NZ milk and we already have a competitive environment at the farmgate, we are arguing that some changes need to be made.”

Wilson said Fonterra supported DIRA but did not want to be in a heavily regulated industry that spent time and money on arguing in court.

“Keeping DIRA is important, especially the milk price regime and the underlying rules.”

In November Primary Industries Minister Nathan Guy and Commerce and Consumer Affairs Minister Paul Goldsmith said the final Commerce Commission report would be out by March 1.

Guy said he intended to consult on a package of policy proposals in mid-2016.

The commission’s draft report said that competition was not sufficient to warrant industry deregulation at present.

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