Meat co-op dilemma
Meat processor Alliance Group's cash-strapped farmer shareholders face a dilemma - either pour more money into the co-operative or risk losing 100% ownership and control.
The cooperative’s platinum and gold farmer shareholders are paid a loyalty payment for each stock species they supply to Alliance. That means farmers supplying 100% of their lambs are paid an additional 10c/kg/animal, sheep 6c/kg/animal, cattle 8.5c/kg/animal and deer 10c/kg/animal.
The cooperative has so far distributed more than $13.8 million including GST in loyalty payments to farmers this year.
David Surveyor, chief executive of Alliance, says the payment recognises the loyalty of farmer shareholders.
“Our shareholders are rewarded for their committed and consistent livestock supply. These loyalty payments strengthen our competitive advantage, building on our efficient livestock processing position and market penetration.
“Alliance is now New Zealand’s only remaining 100% farmer-owned red meat cooperative. That means every cent is either re-invested back into the business or delivered back to farmer-shareholders.
“Alliance’s cooperative principles also mean the interests of farmer-shareholders are at the heart of every decision the company makes.”
