09/13/2022 | Press release | Distributed by Public on 09/12/2022 19:39
An Amendment Bill introduced to Parliament today will provide greater economic security for New Zealanders by supporting Fonterra's move to a new capital structure which will reduce long-term risks to New Zealand's $22.1 billion dairy sector, Agriculture Minister Damien O'Connor said.
"The Dairy Industry Restructuring (Fonterra Capital Restructuring) Amendment (DIRA) Bill supports the Fonterra co-operative's move to its new capital structure, and sets the foundations for the continued future success of our highest value export sector," Damien O'Connor said.
"New Zealand dairy farmers are world-leading and the Fonterra co-operative has been a central part of this.
"We believe this Bill strikes the right balance between supporting Fonterra's shareholder mandate while taking the opportunity to improve transparency in the sector.
"Long-term sustainability, fair pricing in the domestic market and value creation in New Zealand's dairy industry is part of the balance we are aiming for. The past two decades have seen new entrants bring competitive innovation to the industry and we want to see that continue.
"Our dairy industry's continued success is vital to both New Zealand's ongoing economic recovery, and protecting New Zealanders from the sharp edges of a global economic downturn."
The Bill's key risk mitigation measures were developed following consultation with industry, and will:
"It's important the Amendment Bill proceeds quickly to give certainty to Fonterra, farmers and the wider dairy sector," Damien O'Connor said.
"The Bill's first reading will take place later this month, and I expect the Select Committee stages of the legislative change process to take place this year. This will provide the opportunity for the dairy sector and public to provide further comment and input.
"The benefits of a high-performing and efficient Fonterra flow through its nearly 10,000 farmer-shareholders into our rural communities.
"This Bill will play an important part in the ongoing resilience and prosperity of rural New Zealand," Damien O'Connor said.