Andrew Dickens: Smaller milk companies should have more say in the farmgate milk price

On Saturday I went to my local rugby club’s game. North Shore versus Northcote. A game Shore comfortably won And there I met the president of the club Laurie Magrain, who as it happens is a fan of this station and the Chair of New Zealand’s second largest dairy company, Open Country.He told me he’s been down at Field Days all week. Of course being a nosey radio guy I googled Laurie when I got home and discovered he’d been making a noise at Field DaysHe’d been talking about the review of the Act that regulated our milk industry The Act gives the responsibility of calculating the farmgate milk price to Fonterra because when it was set up it was the biggest player by far These days Fonterra controls 78 per cent national milk so he’d like other milk companies to have more say in setting the farmgate price he argues the market isn’t truly competitive, and without clear, open pricing rules, smaller processors can’t compete on equal footing. I agree. It’s a funny thing about business philosophy.  More competition does create better scenarios. Meanwhile monopolies can be bloated yet can also in certain cases create efficiencies. With the rise of the independent milk companies it’s time to let them have more say to sharpen up Fonterra and give more choice to farmers.See omnystudio.com/listener for privacy information.