Fonterra milk buying guarantee may be relaxed | eDairy News

Fonterra milk buying guarantee may be relaxed

This emerged after the Government released the terms of reference for a review of the 17-year-old Dairy Industry Restructuring Act 2001 (DIRA.)

Fonterra was given near monopoly status after dairy industry restructuring in 2001. The DIRA was put in place to regulate Fonterra, protecting the long-term interests of farmers, consumers and the wider economy.

Fonterra was required to collect milk from all farmers who chose to sell it.

Minister of Agriculture Damien O’Connor said the review could see Fonterra excused from this requirement.

“If you want to put another thousand cows on your farm, or buy another farm, Fonterra have been obliged to pick up your milk regardless of the impacts of that on the company or the environment,

“They (Fonterra) want to be able to say, ‘No, perhaps we don’t want the milk because we think the cows are in the wrong place’,” he said.

But dairy farmers must not have their livelihoods put at risk by Fonterra, Mr O’Connor said.

“If you’re a dairy farmer and they (Fonterra) were to turn around and say we don’t want your milk, then you have a huge liability on your hands,” he said.

The review will also look at the price of raw milk for farmers, how competitive the milk market is, and incentives to make value-added product.

“The dairy industry will be fully consulted throughout the review so that any issues can be given full consideration before any changes happen,” he said.

Damien O’Connor said farmers, dairy processors, consumers and the wider public would be able to take part in the upcoming consultation process.


By: Eric Frykberg

Source: Radio New Zealand


Any claim arising from the information contained on the eDairy News website shall be submitted to the competence of the ordinary courts of the First Judicial District of the Province of Cordoba (Primera Circunscripción Judicial de la Provincia de Cordoba), Republic of Argentina, in the city of Córdoba, excluding any other jurisdiction (Federal jurisdiction is also excluded).


Criteria in the moderation of comments that eDairy News will take into consideration in all its publications.

  • They will not be considered insults of any kind against anyone,, whether a user, moderator or publisher. Complaints made with the name and surname of the author of the commentary will only be accepted after confirmation by the moderator.
  • Unsubstantiated and gratuitous destructive criticism or expressions of bad taste, whether offensive, racist or xenophobic.
  • SPAM, (Insert links to web pages not related to the subject, provide emails, etc...)
  • Comments that are meaningless with the footnote or the dairy sector.

Related posts