February 8, 2010
Fonterra criticised for expansion plan in China
Fonterra's announcement to expand its dairy operations in China has been criticised on the grounds of integrity.
New Zealand Federated Farmers dairy chairman Lachlan McKenzie has hit out at the plans suggesting that Fonterra suppliers should only accept investments that maintain integrity of the company's brand.
McKenzie referred to Fonterra's criticism that proposed "factory" dairy farms in the McKenzie Basin, suggesting that stall-based farming was not consistent with New Zealand's reputation as a source of dairy products from substantially grass-fed cows.
"If there's concern about 'brand damage', Federated Farmers believes it won't come from applications for 16 loose house dairy farms in the Mackenzie Basin. Especially as these applications all fall on existing stations in a modified working landscape," he said.
Rather, risk could come from a stocking rate of 94 cows per hectare in China, which compares unfavourably to the 3.5 cows per hectare proposed for the 16 farms in the Mackenzie Basin, he said.
McKenzie said Fonterra needed to apply the same values and standards it has demanded from potential suppliers in the Mackenzie Basin, to its Chinese operations.
McKenzie is a Fonterra supplier.
