Global Co Strategy: Who Pays?

MEDIA RELEASE

By Farmers for a Better Dairy Deal

6 June 2001

Global Co Strategy: Who Pays?

“We need a strong structure that can deliver the strategy”, said Hilary Webber on behalf of Farmers for a Better Dairy Deal.

The industry’s strategy will demand a lot more money – to the tune of $12 billion. “And farmers want to know where it’s coming from”, said Hilary Webber.

“The Global Co strategy calls for an additional $8 billion in loans”

“It also calls for $4 billion in new equity capital over 10 years”. [As at today, NZ dairy farmers have about $3 billion invested in the industry].

“That’s about $300,000 of extra capital required from every dairy farmer in NZ”, said Hilary Webber.

“Where’s it’s going to come from?” asked Hilary. “None of us have that sort of money to invest in foreign milk factories”.

“A lot of it will be taken from farmers’ milk payout”, said Hilary Webber. Under Global Co – a farmer only co-op – it can’t come from any where else.”
“And how is this huge amount of suppliers’ money to be spent?

“Global Co’s plan is to buy lots of big milk factories in Brazil, Mexico and SE Asia”.

“What really gets me about Global Co is that Craig Norgate and his team will decide for everyone. And if they get it wrong, we’re all stuffed”, lamented Hilary Webber.

“I want to decide where my milk payout money is invested, thank you very much”, said Ms Webber.

“The fact is, most farmers I know don’t realise just how much money Global Co’s strategy will require. And they don’t realise that NZ dairy farmers can’t provide all of it – it’s just too much for 14,500 dairy farmers to find”.

“Global Co is desperately trying not to tell farmers that, sooner or later, they will be forced to bring in outside share capital”.

“Mr Roadley’s claims about keeping the industry ‘closed’ to farmers only might make some farmers feel safer, but in my honest opinion it’s just not true – it’s not possible”.

“John Roadley, Greg Gent and the others should swallow their pride and say what they know. Better to do it now than later, when it really is too late”, concluded Hilary Webber.

ENDS

Inquiries to:
Hilary Weber (07) 827 1722 or (025) 907 342

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