PDA

View Full Version : Fonterra setting NZ domestic dairy prices.



BDL
17-04-2011, 06:27 PM
I have been following the discussion in the media about the high cost of dairy products in NZ for a while now.
I lived in Australia for 5 years up until 2008, and found dairy products there were usually about 30%-40% cheaper than prices in NZ. A lot of these products where often Fonterra brands.
I have just returned from a trip to Europe and in Spain, where we spent the most time, UHT milk is the main form that fresh milk is bought. This requires no refrigeration until it is opened and has a long shelf life, making it a very good product from an environmental point, with still most of it's nutritional benefits still intact.
This retailed in the supermarkets for 0.48cents for 6 liters. Standard milk was still considerably cheaper than NZ, not to mention the huge range of cheese available at very affordable prices, prices and selection you would expect from a huge dairy producing nation like ours.(This should be a tourism draw card.)
Why has the government allowed Fonterra, by special legislation, to be a monopoly in NZ and to over charge New Zealanders like this?
Why is Fonterra a closed shop in NZ to the huge beneft of just the farmer shareholders, why can we not all be shareholders in this NZ icon?
Why can Fonterra farmers, all 13,000 of them, sell out our country to the Chinese for huge profits, again stopping average New Zealanders getting into the industry.
Why can we not value add, and create jobs and a country we can all be proud of.
This is an election year and I get the feeling a lot of New Zealanders are getting tired and disillusioned with the why things are going.
Why do NZ farmers get special treatment in NZ with drought relief etc, my small business doesn't.
Just a few thoughts for your comments.....

BDL.

RRR
17-04-2011, 08:59 PM
Agree with every point you raised. Gulf countries export oil more than any one else and the oil is cheaper than bottled water over there and they dont rip off their own citizens in the name of getting a fair price for their produce (or benchmarking against international prices). I blame the Govt which allowed this to happen - which one?

STRAT
18-04-2011, 07:47 AM
Hi fellas
Anyone know the wholesale price?
i suspect the Auzzie Supermaket monopolies are a large part of the reeming we get with the price of milk like so many other products.

craic
18-04-2011, 09:47 AM
A 1KG block of Australian Tasty cheese is generally dollars cheaper than a block of NZ Tasty cheese in Countdown where we shop for groceries.There is no perceptible difference in taste or texture. I spent time in Yorkshire last year and commented on the lack of dairy herds in the countryside on very clearly dairying land. I was told that most farmers were close to bankruptcy from cheap European dairy produce and had sold their herds.

Sideshow Bob
18-04-2011, 08:15 PM
I was talking to a colleague who use to work for Fonterra, and he said that milk was one of the most profitable items, with about 35% gross margin or mark-up (not sure which). Because they got paid that day for the milk, and then didn't have to pay Fonterra until the next month, they turned over their stock 62 or 63x before they had to pay for it. Stocked by Fonterra also - no labour.

Foodstuffs don't declare their profit, and notice today Progressive don't declare their profit, but declared their sales.

A third player in our small market might give a bit more bite to competition......