4 NOVEMBER 2015

Global Dairy Trade Fall Will Worry Farmers - Peters

A second consecutive fall in Global Dairy Trade (GDT) will likely reignite fears about how solid Fonterra’s forecast payout is for the 2015/16 season.

“This second consecutive GlobalDairyTrade will weigh heavily on the minds of farmers,” says New Zealand First Leader and Member of Parliament for Northland Rt Hon Winston Peters.

“GDT gains have halved since the start of this season but those gains came from a low base. This is not what farmers expected, given talk of an El Nino drought, a fall in dairy cattle numbers and with it, a 3% drop on Fonterra’s peak milk day.

“Farmers also know that more often than not, the back half of the season has not been kind in terms of GDT auction prices. Given we are coming off a low price base, this fall will not be welcomed by farmers and the Reserve Bank must take note of it.

“Farmers should also be unhappy with how National has sold them down the river with low-ball Korean and TPPA dairy trade deals. National has agreed permanent quotas and tariffs in the Korea FTA and permanent tariffs with Japan in the TPPA.

“We also need to face up to the reality that China’s market is no longer ‘all ours,’ given the China-Australia Free Trade Agreement is likely to start on 1 January.

“This is not the time for National to be firing up its red-tape machine, or entertaining the inclusion of agricultural biological emissions in the ETS. Yet that’s exactly what Minister Nick Smith’s Ministry for the Environment is pushing for.

“Nor is it a time for Fonterra to go down Alice in Wonderland’s rabbit hole over the size of its board. That is a distraction farmers we speak to do not want or need, when profitability and the milk price must be Fonterra’s priorities,” says Mr Peters.

ENDS

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