Product mix based on profitability
Despite high fat prices it is now more profitable for Fonterra to make whole milk powder than butter and skim milk powder, co-op chairman John Wilson says.
Speaking at the DairyNZ Farmers Forum earlier this month, Wilson spoke about his childhood days on his family farm.
“Running around on our farm and then working on our farm… even going back as far as five to seven years ago, how different it is on our farms today,” he said. Speaking on DairyNZ’s strategy, Dairy Tomorrow, Wilson described it as an exciting step for an industry long accustomed to transitioning.
“And this strategy is all about how we transition and how we respond to the requirements to change at a far faster rate.
“The strategy will undoubtedly stretch us; it will take many of us outside our comfort zone at times but that’s a good thing.
“We are an industry known for innovation within and outside the farmgate.”
Wilson says he is confident that the industry, with its can-do attitude, will continue to meet the expectations of communities and global customers.
He showed the 550 farmers at the forum a chart of Fonterra’s progress in sustainability. It showed that 95% of the co-op’s supplying farms in NZ take part in nutrient management reporting and benchmarking and 98.4% of waterways on supplying farms are fenced to keep cows out.
Fonterra farmers have reduced somatic cell count by 22% since 2009.
Wilson says significant progress has been made on sustainability and the Dairy Tomorrow is the next step.
He also touched on a small group of farmers whose poor behavior give the industry a bad name.
“Unfortunately, like every industry we have a tail and sometimes that tail can be too long; there is poor behavior among some farmers.”
DairyNZ chairman Jim van der Poel told the Farmers Forum that the strategy and its goals continue the good work being done on farms.
“A lot of dairy farmers have already been doing great things to build competitive businesses, produce quality product and be leaders in sustainability, animal care, employment and in the community.
“I believe this strategy will help transition farmers into future farming systems.”
Van der Poel says NZ farmers are great producers of high quality milk and milk products.
“We are one of the world’s best at it. We all know that as a small country we punch well above our weight as a food producer.
“But keeping our production and meeting our goals as a sustainable, responsible sector takes skill as we implement farm systems that are more complex, scientific and technology-driven than ever.”
Strategy goals
- To protect and nurture the environment for future generations
- To build the world’s most competitive and resilient dairy farm businesses
- To produce the highest quality and most valued dairy nutrition
- To be world-leading in onfarm animal care
- To build great workplaces for New Zealand’s most talented workforce
- To help grow vibrant, prosperous communities.
