No demonstrated need to change Fonterra

The Green Party is concerned that Fonterra has not demonstrated any need to change its ownership structure and may be being driven by the investor market who want to capitalize on the huge profits to be made in the sector.

“The current Fonterra structure is working well. I have not seen the co-operative demonstrate any need to change this. They are not being faced with a run on capital with farmers wanting to sell their shares that would force them into such a move,” Economics Spokesperson Jeanette Fitzsimons says.

“This new structure would open up the co-operative to foreign investors and eventually up to 50 percent could be held offshore, and these profits would go straight out of the country. I can’t see how that will benefit New Zealanders.

“It could also see ‘New Zealand-made’ dairy products being produced offshore, but sold under the Fonterra brand. This has the potential to damage New Zealand’s clean green reputation as consumers could no longer be certain where Fonterra’s products hail from.

“I would encourage farmers to be very careful in allowing Fonterra to buy into the pressure from investors and dilute the cooperative nature of New Zealand’s largest company,” Ms Fitzsimons says.