Richard Prosser MP

Spokesperson for Fisheries
21 SEPTEMBER 2016

Dairy Industry Continues to Struggle Thanks To Govt Policy

While farmers will be relieved to see Fonterra upping its 2016/17 milk price forecast to $5.25 per kilogram of milksolids (kg/MS), New Zealand First is cautioning against the co-op over promising and then being forced to under-deliver.

“This is brighter news but there is no room for complacency while the National Government’s neo-liberal economic model and approach to some aspects of international trade remain fundamentally flawed,” says Richard Prosser, New Zealand First Primary Industries Spokesperson.

“Fonterra’s cashflow may improve in the short term if projected price increases do in fact materialise, but the industry is still too dependent on global volatility in commodity prices, and geopolitical factors that are beyond New Zealand’s control.

“Potential exists for another 50 to 60 cents per share, but a good many farmers, at the behest of banks, now have sold down their shares under Trading Among Farmers, something that wasn’t possible before National started meddling with the structure of the Cooperative.

“New Zealand First said at the time the DIRA Act was bulldozed through Parliament that allowing Fonterra to become a money-making device for outside share traders, at the expense of New Zealand farmer shareholders, would threaten the integrity of the Co-op, and once again we’re being proven right.

“On top of that we’re seemingly in an economic cold-war between east and west, which continues to affect milk demand and prices.

“This sees massively subsidised US and European milk washing into our markets and until that is resolved there will be a lid on price recovery,” Mr Prosser said.

“In the meantime the potential of the Russian market, the world’s second largest dairy importer, remains off-limits to New Zealand farmers because John Key doesn’t want to upset Barack Obama.

“A fifth of the economy and a quarter of export receipts are dependent on dairy, and this National Government really does need to get it through their heads that the interests of the nation come before proven failed ideologies.

ENDS

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