Winchester dairy farmer on world wide quest

Winchester dairy farmer on world wide quest

Winchester dairy farmer Desiree Reid is packing her bags for a six month international study tour of the world’s most successful cooperatives on her 2010 Nuffield Farming Scholarship.

Desiree Reid, one the three agriculture leaders awarded the prestigious Nuffield for next year, has prepared her research into growth strategies of cooperatives and how strategy is impacted by co-operative ownership. She will draw lessons from other forms of closed membership organizations such as family businesses.

“Some of the world’s best known brands belong to closed membership companies, such as Mars, Bollinger, Tattinger, IKEA kitset furniture, Victorinox Swiss Army knives, and Bosch,” Desiree said.

”One of the questions I am asking is how big can a cooperative grow to be sustainable and successful and I shall be looking closely at how some of these global market leaders have achieved their success without using public equity.”

Desiree, who farms with her husband Paul Mercer, was elected to the Fonterra Shareholders’ Council in 2006, and she is a member of the Council leadership team. She has a First Class Honours degree in Business from Massey University, and studied law at Otago for two years. Desiree has spoken at several agribusiness conferences on her honours research.

“I’ll be going to the UK and Ireland, Europe, North America, Australia, China and South East Asia. The Nuffield opens many doors so I will be talking to the heads of companies, bankers, analysts, academics and people involved in dairy cooperatives. My research topic is to get a complete understanding of the ways in which cooperatives can grow and develop, and to study what happens if they incorporate public equity.”

“I want to see if cooperatives are a sustainable long term business model, and the lessons other cooperatives have learned. The Kerry Group in Ireland is an example I want to understand. Kerry Co-op went public in1986 and that was a terrific success for the company and the new owners, and Kerry is now the size of Fonterra. I want know if listing was a success for the Kerry farmers.”

Desiree said that as a dairy farmer she was concerned that decisions about the future of Fonterra must be made with the full understanding of where those decisions might lead.

“Our industry growth has been based on cooperation for more than a century and we have total ownership and control of our company. Any moves to dilute that ownership, for whatever reason, need to be given the greatest possible scrutiny.”

Desiree said her research report will help dairy farmers understand what happens to farmer profitability, ownership and control when the cooperative model in the dairy industry has been changed.

“I will gain an understanding of the problems, challenges and solutions that large international cooperatives and closed-ownership businesses have resolved when they needed significant capital, so that we can learn from them.

“For instance, one of Australia’s largest wool exporters is Michell, a family owned business, and Ocean Spray, an international producer of cranberry products is a grower cooperative, and Rabobank is a cooperative.

“There are many examples of cooperatives being global players and how they achieved that standing as cooperatives will be a key part of my report.”

“I will gain an understanding how dairy is different to other industries and why co-operatives dominate the dairy world. Every major dairy producing country has followed the co-operative model, which was first developed in the 1400’s, the principles refined at Rochdale in 1884, and picked up by New Zealand farmers by 1900.”

Desiree hopes to visit the world’s largest dairy co-operatives including Friesland-Campina, Dairy Farmers America and Arla.

Desiree will be away from mid January to mid July. The study trip begins with a business leadership course at the Royal Agricultural College at Cirencester (Gloucestershire, England). In June she will be on a Nuffield-organised Global Focus Tour where she will join Australian scholars for a six-week whistle-stop world tour. The group will visit and debate with world food leaders and gain an understanding of global food trends.

ENDS

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