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Fonterra position "must be protected"

Rural News
Fonterra position "must be protected"

In 1961, Irish farmer Thomas Clinton was milking six cows by hand. By 1983, he was milking 140 but any chance of further growth was removed with the introduction of the European Union's Common Agricultural Policy (CAP) milk quota. The European-wide CAP policy held milk production at 1983 levels, which meant he was unable to milk an extra cow for 12 years. At the time, NZ and Ireland were producing the same amount of milk. Now NZ produced 3.5 times more, he said. But the rules had promoted European agriculture and allowed its "orderly modernisation", Mr Clinton said."Europe had lots of very small and very old farms and if they were forced to modernise to the NZ  level there would have been a phenomenal problem." Ireland had 65,000 dairy farms in 1983. There were now 19,000, and he expected numbers to drop to less than 10,000 in 10 to 15 years reports The Southland Times. His family trust began buying farms in Southland in the early 2000s, including sheep and beef farms that were converted to dairy. In the past two years, the trust spent almost $20m on farms, including $14.2m on 238ha near Woodlands.The trust farms 1450ha, with 2500 cows, producing 1 million kilograms/milksolids a year. Mr Clinton has also bought a quarter interest in two dairy farms in the United States. He told delegates he had listened to criticism of Fonterra "at a pretty high level", which was unjustified. The dairy giant needed to be protected. "Fonterra, to my knowledge, is the only company in the world which controls directly and indirectly over 50 per cent of the traded product (milkpowder) in the world. But you're busy finding reasons to put more competition in here, to do away with its dominant position." Mr Clinton had worked for 25 years in Ireland to try to get something similar to Fonterra but nothing had developed. "Fonterra have to be competitive. They have to run a good ship. There's a far better future for New Zealand with Fonterra running a good ship than there is with a New Zealand with several milk suppliers."

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