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

 


Changes Ahead For Sharemilking

10 April 2006

Changes Ahead For Sharemilking

Good communication between sharemilkers and their employers is vital during the switch from Fonterra peak notes to a capacity adjustment next season, say sharemilkers and sharemilker employers.

“Both parties to sharemilking agreements must communicate with each other and work towards an outcome that maintains a harmonious and successful business arrangement,” said Dean Bailey, chair of the Sharemilkers Section of Dairy Farmers of New Zealand (DFNZ).

“Sharemilkers supplying Fonterra must not be disadvantaged by the introduction of a capacity adjustment next season.”

Fonterra will from June replace peak notes with a capacity adjustment. Each shareholder will be able to provide a certain volume of milk over the peak without having to pay a capacity adjustment. If a farmer supplies more than this volume, the farmer will pay a capacity charge. If less, farmers will receive a payment.

For the majority of sharemilkers, the switch to a capacity charge or payment from June 2006 will result in very little change.

“But there will be a minority of sharemilkers who could be adversely affected, such as new dairy conversions, or farms which are expanding to increase production. These sharemilkers will receive a lower payout because their share of the total milk payout will be lessened by a capacity charge,” Mr Bailey said.

However, there will be farm owners with a low peak curve who will receive an enhanced payment. Some may choose not to share this premium with their sharemilker.

“It is therefore essential that both sharemilkers and farm owners are fully informed about how the capacity adjustment will affect the bottom line returns for their respective businesses,”said Michael Joyce, chair of the Sharemilker Employers Section of DFNZ.

“With the implementation of the capacity adjustment, it is important that sharemilkers are not placed in a worse financial position by this method of payment.

“One way of ensuring this is for the farm owner to elect that the sharemilkers will not be charged or share in any charges or payments resulting from the capacity adjustment,” Mr Joyce said.

“Any adjustment to payment must be agreed by both parties and must be nominated by the farm owner in the "Change of Sharemilking Arrangement" form available from Fonterra.

“It is important to note that if you do not notify any change to your sharemilking arrangement, payments between shareholder and sharemilker will be split under the current arrangement. This could result in the sharemilker receiving less income,” Mr Joyce said.

Finally, sharemilkers and employers must be aware that failing to discuss the effects of the change could result in a breach of their sharemilking agreement.

Sharemilkers and employers wanting to know more about the implications of the capacity adjustment should contact their local Fonterra field representative 0800 65 65 68.

DFNZ is the dairy arm of Federated Farmers of New Zealand.

ENDS

© 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>>

ALSO:

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>>

Earlier:

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>>

ALSO:

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>>

ALSO:

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>>

ALSO:

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>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news