Payout Increase Highlights Risk Of Fonterra
Restructure
Today’s announcement by Fonterra of a 50
cent increase in this season’s forecast payout to dairy
farmers is great news, but highlights what farmers risk
losing if they accept the company’s preferred capital
restructure option, says the party’s primary production
spokesperson Doug Woolerton.
“The increase in the payout
to $6.90 per kg of milk solids is excellent news for farmers
and excellent news for the New Zealand economy as a
whole,” said Mr Woolerton.
“While good news, the
increased payout reinforces New Zealand First’s view that
the proposed option for Fonterra’s capital restructure
would be a disaster for farmers.
“Farmers currently
receive any profits through the milk price. This will no
longer be the case under the proposed restructured company,
as profits will be extracted from the milk price to allow a
return to be passed on to non-farmer investors. This
extraction will also likely increase as farmer shareholding
decreases over time.
“As a result, farmers, who were
once masters of their own destiny and who were rewarded for
their blood, sweat and toil will end up beholden to
non-farmer investors in the new profit- driven company.
“The decision ultimately rests with farmers, and I urge
them to act in both their and the country’s interest and
reject the restructure proposal,” said Mr
Woolerton.
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