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Fonterra Should Stick to Core Business

Fonterra Should Stick to Core Business

Dairy farmers are gutted by Fonterra's announcement of a further drop in the price per kilo of milk solids to $3.60.

Dairy Farmers of New Zealand Chairman Kevin Wooding says Fonterra should get on with its core business of processing and selling milk.

"Fonterra has to deliver a better result to its shareholders. They have taken their eye off the ball while playing at being the Government.

"Dairy farmers will have serious questions about Fonterra's highly publicised industry good initiatives like the employment of a high profile trade counsellor whilst announcing a payout reduction.

"Shareholders have yet to realise the promised benefits of restructuring. When these costs along with funding for Dairy Insight are removed this payout demonstrates a very poor performance.

"Fonterra desperately needs to improve to regain the support of its shareholders. They will find it very difficult to reconcile an even greater differential between Fonterra's and Tatua and Westland Dairy payout.

"The Government would do well to encourage Fonterra to stick to its core business because this announced drop is likely to take $80 million out of the economy."

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