Global demand for dairy growing speedily
TWO days after his reelection to Fonterra’s board Sir Henry van der Heyden was fronting farmers at the cooperative’s annual meeting.
Sir Henry was re-elected with fellow board members Malcolm Bailey and Ian Farrelly on Tuesday.
On Thursday the Putaruru dairy farmer spoke in Hawera at the co-operative’s annual meeting.
Sir Henry described 2010 as an ‘‘important year’’ for Fonterra, primarily due to the capital structure vote in June.
‘‘The biggest success was not just the positive vote but how many of our farmers got involved,’’ he said. ‘‘More than seven and a half thousand of our farms voted on Trading Among Farmers.
‘‘That’s 80 per cent of our milk and the highest level of participation since Fonterra was formed.’’
Sir Henry said work on the capital structure changes had continued since the vote in June to ‘‘ensure we have a market that works from all angles’’.
He expects a round of farmer meetings to be held in the new year to discuss the work so far.
Sir Henry said he recognised many farmers were ‘‘still in a very tight financial position’’ with high costs and pressure from banks.
Newly re-elected Fonterra chairman Sir Henry van der Heyden told the co-operative’s annual meeting in Hawera the future was bright for the dairy industry.
‘‘As a board our priority is always to put as much money in farmers hands as possible. We recognise every cent of payout counts in a farm budget.
‘‘Farmer returns this year were the second highest ever with a total payout before retentions of $6.70 and $6.37 on average in farmers’ hands.’’
Sir Henry said the dairy industry was continuing to do well as other sectors struggled.
‘‘There’s a lot of volatility in global markets. But the dairy fundamentals remain good on both the supply and demand sides.
‘‘Long-term prospects are bright. Dairy consumption is increasing faster than global population growth.
‘‘And dairy has a lot going for it with the global trends towards healthier, more nutritious foods.
‘‘But we are going to see much more volatility. New Zealand production makes up only a tiny fraction, about 2 per cent, of the world’s milk so we will always be at the mercy of powerful forces in world markets,’’ he said.
‘‘The world is changing. Consumers have a strong interest in how their food is produced, and the impacts on their environment.
‘‘New Zealanders are interested in how farming impacts on their environment. And how it contributes to our economy.
‘‘The challenge, not just for dairy farmers but for the country as a whole is to weigh up what’s right and how we strike the right balance for New Zealand.
‘‘I want to see New Zealand in behind us. We need the support of New Zealanders for dairying to be allowed to grow so that we continue to do well. New Zealand needs us for our economy to prosper,’’ Sir Henry said.
‘‘When I talk with our farmers, I feel a sense of unity and spirit which gives me a lot of pride and confidence about the future.
‘‘As I stand here today, I can’t think of a better business to be in and I can’t think of a better time to be a Fonterra dairy farmer.’’