Richard Prosser MP
Spokesperson for Primary Industries
17 December 2014

Dairy Price Lift And the Need for Fonterra to Deliver Value-Add

While the 2.4 percent rise in GlobalDairyTrade, the biggest increase since 3 December 2013, is good news for New Zealand’s embattled dairy farmers at Christmas time, what they really need is for Fonterra to deliver on the value-add promise made at formation.

“This is welcome news and while it may be a blip anything with a plus sign in front of it is truly welcome,” says New Zealand First Primary Industries Spokesperson Richard Prosser.

“It is especially welcome news for sharemilkers and farmers who are in their first season. It has been really tough on them and they’re important because they’re the future of the industry.

“Since dairy farmers are into the business part of the season, they need to take time out to consider the settings of their industry and the wider economy.

“New Zealand’s exports are still too susceptible to the vagaries of international trading and our uncontrolled high dollar is only making imports cheaper. It is part of what Winston Peters called Ponzinomics, where Labour and National have managed the economy like Tweedledum and Tweedledee.

“When Fonterra was formed it promised value-add but it remains rooted in commodities.

“As agribusiness Professor Keith Woodford has noted, Fonterra slashed the number of brands when it was formed in the early 2000s and has been slow on the branded uptake, especially in China of all places. Despite a head start the Aussies now have a Free Trade Agreement.

“While we can’t clone that value-add star Tatua, Fonterra supplier shareholders need to know when Fonterra is going to use its muscle and scale, as opposed to treading water that inevitably sees a great season followed by a pretty poor one like this one.

“New Zealand First has a plan that could see a golden age for all of New Zealand’s primary industries and New Zealand manufacturing.

“That starts with flexible monetary policy so that exporters come first not last. It is about keeping control of our productive assets and land while investing properly into our people, our biosecurity and into Research and Development.

“Our farmers get the blame for plenty of things that aren’t their fault, but they also pay three-quarters of the nation’s bills, so they deserve some recognition and a fair go when they’ll be out there working on Christmas Day,” says Mr Prosser.

ENDS

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