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Fonterra and Synlait in war of words over dairy reform | RNZ News

In a submission on the reform process, Fonterra said there was now plenty of competition, so many of those rules could be relaxed.

But Synlait’s submission accused Fonterra of often paying more to farmers than market conditions for milk said it should.

It funded this higher price by sacrificing the value of its own shares.

“The system enables Fonterra to make unilateral and arbitrary choices about the allocations of earnings between milk price and capital,” Synlait said.

“There is a lack of transparency, effective oversight and accountability in the way Fonterra sets the milk price.”

Synlait said these problems tilted the playing field in favour of Fonterra, at a cost to independent dairy companies, and hampered the goal of having a fully contestable milk market.

To fix this, Fonterra should be required to give detailed explanations every time it changed its prices, and have them overseen by an independent panel.

But Fonterra has rejected the allegations against it, turning the accusation back on Synlait.

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Fonterra and Synlait in war of words over dairy reform | RNZ News.