Govt move to support wool will transform rural sector
A new Government directive to prefer the use of woollen fibres in its buildings has the potential to transform the rural sector.
New Zealand First leader, Winston Peters, says there could be more value added to the agriculture sector.
Peters, New Zealand’s former deputy prime minister, says both he and New Zealand First party member Shane Jones come from dairy farming backgrounds and therefore understand how critical the sector is to the economy.
“There could be much better value added to them,” Peters said in an interview with Country TV.
He believes that added value could be maximised, “in the interests of our workers, and our businesses, and our economy”.
He claims the move to sell infant powder to China is not a smart one.
“Why aren’t we leading the infant formula sales around the world? All the things you see in Scandinavia or Switzerland and, dare I say it, in places like Singapore, all those added value things, we should have been doing,” he says.
Peters places some of the blame on the industry itself.
“We’ve made some serious mistakes and I’ve always been to Federated Farmers meetings and said ‘Look, Gentlemen and Ladies, I don’t understand what you’ve done to your industry.”
“Remember what happened? Fonterra almost went broke! How could it go broke on a speculative deal in China?” Peters says, seemingly in reference to the co-operative’s deals in China.
In 2021, it was reported Fonterra’s balance sheet would take an $880 million hit after divesting its China farms and joint venture farms in the region as well as reducing its shareholding in Beingmate.
The sale of Fonterra’s Ying and Yutian Farm was completed in April of that year for $552m and the subsequent sale of the Falcon China Farms joint venture was completed two months later for $88m, bringing in a $360m loss on investment.
However, the co-operative’s investment in Beingmate was seemingly worse for its shareholders.
Back in March 2015, Fonterra paid $756m for an 18.8% stake in the infant formula maker but its share value has tumbled since the end of that year, forcing Fonterra to book sizeable write-downs.
According to Northington Partners, Beingmate shares sold over the course of 2020 and 2021 fetched the co-op $273m, resulting in an investment loss of $519m over a six-year holding period.
Peters says Fonterra has now had to be saved by the farming community.
“All of this has been a massive cost,” he says.
“They got fooled, they got flummoxed, and they made a big mistake.”
He says representatives of the farming community need to “stand up as well and start owning up to the mistakes they’ve made, and decisions they could have made much more cleverly”.
Get the full story on Country TV, tonight at 7.30pm on sky channel 81, or get 30 days FREE access, online and on demand at www.countrytv.co.nz.
Herd Improvement company LIC is paying out over $2 million this week, as compensation for supplying some dairy farmers bad sire semen.
Nearly half of the available sites in the inaugural New Zealand Dairy Expo have been taken, says organiser Amanda Hodgson.
New Zealand dairy companies say their policy priorities for the incoming government are the same as they were for the previous Labour administration.
Farmers who have switched their milk supply to the country's newest processor say they are happy with the deal they have been offered.
A better than expected start to milk production in New Zealand has softened global dairy prices, says Westpac senior agri economist Nathan Penny.
Canterbury processor Synlait is eyeing a slice of China's lucrative cream market.
OPINION: This old mutt understands that a number of high profile sheep studs are unhappy with Beef+ Lamb Genetics’ recent…
OPINION: Your canine crusader is astounded at the sheer cojones of webbased media company Newsroom and its wont to cadge…