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Council Calls For Review Of Industry Good

24 October 2006

Fonterra Shareholders’ Council Calls For Review Of Industry Good

The Fonterra Shareholders’Council is calling for a formal review of how dairy industry good activities are delivered because the current structure is not reaching targeted levels of performance.

“On-farm productivity gains over recent years have been less than 1% — well below the industry target of 4%,” Council Chairman John Monaghan said.

“Dairy farmers are committed to funding R&D, but want to be sure that the benefits back on farm are maximised.

“Sustainable gains in on-farm productivity are essential to maintaining New Zealand dairying’s international competitiveness. Farm profitability is under increasing pressure and one of the areas farmers are looking at is how effectively their levy money is being used.”

He says industry good performance has been an area of farmer concern for some time, and the Council has discussed the need for a review with Tatua, Westland and Fonterra together with the Dairy Companies Association of New Zealand (DCANZ).

“We all agree that a review is both timely and necessary, and have approached former Dairy Board chairman Graham Fraser to lead the process.

“The review will look at ways to improve the effectiveness of industry good investment. I expect to see thorough consultation and input from all interested bodies including dairy farmers, Federated Farmers, Dexcel, Dairy InSight, AgResearch, Lincoln and Massey Universities.

“It would be good to see the review completed and the consultation undertaken in time for implementation next season.”

Mr Monaghan says he was calling for the review as Chairman of the Fonterra Shareholders’ Council because Fonterra suppliers funded $40 million of the annual $43 million levy collected for industry good activities and had the most to lose.

“Farmers are due to vote on the industry levy again next year and they need to be confident that the dairy industry’s R&D structure and spend deliver the best results on-farm.”

ENDS


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