How much change is required to get the dairy industry to a 'better place'?
How much change is required to get the dairy industry to a 'better place'?
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Like many others I saw and heard comments, 26.6 on ABC about the State of the Industry. Closing of the Fonterra Plant was featured and story related to workers in the Plant, the Plant Owner, and ultimately comments from farmers, new Chairman and a serious comment predicting "failure" for the industry, reliance on imports and dissatisfaction with the Industry Organization generally. Situation Analysis "Snapshot" on internet also highlights problems. Law suits, Class Actions, Unprofitable Operations, Unfair Market "Players", and almost "unbelievable" contracting methods, corruption and extravagance (coffee maker) highlighted in Press.....but "Solutions"? A Dairy Plan, sounds something like the "Car Plan" and now where are the Car Manufacturers in Australia - Gone! Farmers and their financiers and advisors, along with the "Regulators" seem to keep missing the point! In the "Market Economy", there is always need for "adjusting", this includes "mergers", at every level, including farms, ownership of them (corporate, not just family companies) corporate (not just the farmers) operations of farms, (5th generation farmers rounding up the cows, doing the milking etc., and managing financial strategy?) Efficient marketing, some - probably more vertical integration, diversification of the "on farm" production (not just dairy on every farm), and earlier identification of "aging" and "stranded assets" (like Derrington) at processing level too. ACCC and other regulators really "enforcing" where appropriate, and farmers using better their own (combined to the limit) "market power"! Political "activism" just does not work in an 'almost deregulated" (but still relatively small) Australian Market Economy!
There is effectively no "Stock Market" for private and "institutional" Investors in the Industry! (MurrayG aside). Therefore other than the "Real Estate" element when farms put "on the Market" (for land development etc) no "real" transparency in just what "value" there is in the "Assets of Dairy Farms!
Lifestyle no doubt is still a big "cultural" factor, and a driver for those in the industry, and the appeal by Farmers to be paid more) for "long hours" and "hard work", yet not reflected in what processors, supermarkets and consumers are paying for "unprocessed" milk which is produced!(Some "disruption required here too).
Some all too "obvious" deductions, but along with others may help to bring out needed changes. Not a farmer but a sometimes "service provider" to the Industry, and sometimes "player" in other Agricultural and other Industry Sectors!
Some Intergenerational Expert Change Agents probably needed too! CAN BE DONE.

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9 months ago · 0 votes · 0 comments
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