Fonterra investing $70m in new electrode boilers
While opening the first electrode boiler at its Edendale site, Fonterra has announced a $70 million investment in two further new electrode boilers.
In his final address to shareholders as chairman in Masterton last week, Monaghan paid tribute to the co-op shareholders.
He says farmer shareholders have been brutally honest to him during his governance days and he found that refreshing.
He also thanked the Fonterra board for their work over the last two years to change the co-operative strategy.
Monaghan who took over as chairman two years ago says the board is a cohesive team.
“We fronted up to some big challenges during the past two years and we had to make some big decisions.”
After two consecutive years of losses, Fonterra embarked on a new strategy and returned to profitability in the last financial year.
Fonterra’s chairmanship has been taken over by Peter McBride, the former Zespri chairman.
Former National MP and Fonterra shareholder Shane Ardern remembered Monaghan turning up at Parliament in 2001 to propose the formation of a dairy company of international scale.
“The sky was going to fall...no one was taking the proposal seriously,” recalled Ardern.
He says Monaghan is leaving the co-op and board behind in good shape.
Monaghan told the meeting that international scale is one of the reasons the co-op was established.
“It remains a key strength. Our people have worked hard to leverage that scale, shifting our New Zealand milk into the products and places where we can earn the highest possible value under the circumstances.
“This year has also shown us that even in the middle of a global pandemic, our strategy will deliver.”
Monaghan also paid tribute to the co-op for pulling together during the Covid pandemic.
“We are in no way immune to Covid-19, but this year’s performance shows the diversity of our earnings, which has helped us to manage the impact of the global pandemic.”
Farms under pressure
Outgoing Fonterra chairman John Monaghan says the co-operative knows the pressure farmers are under due to environmental regulatory changes.
However, Monaghan defended the decision to work closely with the Government on looming regulatory changes.
He was commenting on a question from a Southland shareholder at the co-op’s AGM last week about looming regulations.
Monaghan says the business is committed to moving forward in this space.
“We have a healthy relationship with the Government, past governments and will have with future governments,” he says.
“We do have a seat at the table and we are part of those discussions.”
One shareholder took exception to the co-op working with the Government. “There’s no need for us to suck up to the Government who screws harder on us,” the shareholder told the annual meeting in Masterton last week.
Monaghan denied that Fonterra was sucking up to the Government.
“It’s very easy to throw rocks and be in a position where you are not even part of the discussion.
“We can achieve that position very quickly …it’s a lot more responsible and benefits our farmers by taking part in those discussions and helping shape the outcomes.”
Fonterra chief executive Miles Hurrell told shareholders that more and more customers were now asking about the co-op’s environmental credentials.
He says, historically, large customers gave the co-op a month’s notice to visit farms and ask questions around sustainable practices. Now they turn up unannounced and tell Fonterra which farms they want to visit.
