Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


A Better Dairy Deal - Characteristics Of Industry




In reviewing the development of the New Zealand dairy industry since 1892, the following features stand out:

- Continual political lobbying and involvement by central Government;

- Centralised and compulsory mechanisms to manage business risks (such as price fluctuations, price falls, costs of remoteness, and overseas selling);

- Heavy focus on increasing production and farm efficiency;

- A guaranteed buyer for all the milk a farmer could produce (the rules of a dairy co-operative require it to buy all production from its members);

- Technical excellence on-farm;

- A predominance of family farms, with relatively limited access to capital;

- Most farmers with “all their eggs in one basket’ (the dairy industry);

- A strong traditional cohesion built around “co-operative principles’;

- A traditional community of interest within the dairying district;

- A deep distrust of “outsiders’;

- A real fear of becoming “peasant farmers’ to predatory corporates;

- Very limited awareness by farmers of overseas buyers’ needs;

- Except for a brief period in the 1920s , exporting of dairy products from New Zealand has always been managed by the Government or a producer board.

- Prices and costs for dairy farmers have always been “averaged’, “stabilised’ or “supported’ - by a producer board and the Government. True signals from consumers have been “softened’ for farmers.

- Exports comprising mainly commodities and ingredients, which are relatively low value;

- High levels of trust by farmers in their producer board;

- Real control of the producer boards held by senior managers, not directors;

- Rigorous monitoring of the producer boards at a “political’ level, but much less so at a business level;

- Limited flows of meaningful information between the Dairy Board, the co-operatives and farmers ;

- Highly geared public relations machines which constantly reinforces old industry beliefs, particularly in relation to the Dairy Board’s performance and its claimed market power overseas;

- Recurring political power struggles, particularly for directorships and senior management positions; and

- Over recent years, serious (often debilitating) power struggles between the co-operatives to gain dominance in the industry, particularly over the Dairy Board.

© Scoop Media

Business Headlines | Sci-Tech Headlines


I Sing The Highway Electric: Charge Net NZ To Connect New Zealand

BMW is turning Middle Earth electric after today announcing a substantial contribution to the charging network Charge Net NZ. This landmark partnership will enable Kiwis to drive their electric vehicles (EVs) right across New Zealand through the installation of a fast charging highway stretching from Kaitaia to Invercargill. More>>


Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>


Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>


Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>


Half A Billion Accounts, Including Xtra: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>


Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news