Greens want milk price set by commissioner


Fonterra has published a farm gate milk price manual which shows the link between global dairy prices, the amount farmers are paid and the retail price of milk here.

The Statement shows that the 2011 Farmgate Milk Price of $7.60 per kilogram of milksolids (kgMS) was based on revenue[1] of $9.51 per kgMS, less cash and capital costs totaling $1.91 per kgMS.

The 2011 Farmgate Milk Price is $1.50 higher than the previous 2010 Season’s $6.10 per kgMS. This is driven by an increase of $1.56 in net revenue, offset slightly by an increase of 6 cents in costs.

“These figures demonstrate what Fonterra has been saying all along – that the price New Zealand farmers are paid for milk, which in turn flows into retail dairy prices, reflects global prices for dairy commodities,” said Fonterra’s chief financial officer Jonathan Mason.

The 2011 milksolids payment to farmers of $7.60 per kgMS equates to approximately 66 cents per litre of liquid milk.

Over the past two Seasons, net revenues have increased $2.96, or 45%, but in the same period costs have increased by 8 cents or 4% – roughly in line with inflation.

When we export most of our milk, the global market price has a big influence on both the payout to farmers and the retail price.

Green Party MP Sue Kedgley gets the link but says:

“The Milk Price Manual confirms that Fonterra largely bases the domestic price of milk on the global price Fonterra would get by selling milk solids overseas,” said Ms Kedgley.

“We have heard evidence during the Select Committee Milk Price inquiry that the global milk price is hugely inflated by speculators trading in milk.

“This means that New Zealanders ability to pay for a staple food product is being adversely affected by global commodity speculators.

“The Green Party considers that domestic milk prices should not be determined by an inflated global milk price,” said Ms Kedgley.

“We consider a good first step in tackling this issue would be for the domestic price of milk to be set by set by an independent body or Commissioner, not Fonterra.”

Welcome to the socialist republic where the company which produces the milk would have to accept the price set by a commissioner.

The Argentinean government tried to keep the domestic price of beef down by imposing exorbitant taxes on exports. Famers faced with that market signal gave up on cattle and swapped to growing soya which gave them better returns.

Farmers here would make a similar response to an attempt to depress the domestic milk price which, in effect, would mean they were subsidising consumers.

If the Green Party wants to be taken seriously it’s MPs need to get a better grasp of economics.

They could start by looking at the law of supply and demand and the relationship between them and prices.



Another Green retiring


Green Party MP Keith Locke has announced he’ll be retiring from parliament at the election.

Two of the party’s MPs – Jeanette Fitzsimons and Sue Bradford  already stepped down during this term and Sue Sue Kedgely has also announced she won’t be standing again.

That’s a lot of renewal for a wee party.

PKE fungi story short on facts long on hysteria


Disclosing a preliminary draft report on the danger of fungi in palm kernel extract (PKE)  as Sue Kedgley did in parliament was reckless and irresponsible, Federated Farmers says.

“Releasing a preliminary draft report, which has never been finalised, peer reviewed or subjected to robust scientific methodology is irresponsible,” says Lachlan McKenzie, Federated Farmers Dairy chairperson.

“Palm Kernel Expeller is a dry feed and like any dry matter, if it gets wet, it will attract fungi.  That’s the same with maize, silage, bread or even sportswear. 

“AgResearch put together a draft report on the ‘shocking expose’ that Palm Kernel Expeller, when wet, attracts fungi. . . 

“The Ministry of Agriculture reviewed the report in 2006 and found that of the fungi identified, the vast majority were already present in New Zealand and the few remaining were common in almost every country on earth.

“The New Zealand Food Safety Authority looked at the general issue of fungal growth on animal feed and concluded there was no risk to food safety.”

He said he’s concerned that the Green Party grabs every opportunity, no matter how tenuous, to knock New Zealand’s largest and most important industry.

“Most people don’t believe the recycling of a waste by-product like Palm Kernel Expeller into animal feed is a bad thing, so long as it comes from certified sources.  Especially if that waste would otherwise be burnt or just left to rot.

“Most New Zealanders also believe it’s hypocritical to target farmers, when they themselves use palm oil daily in the household goods they consume or the cosmetics they wear.

“I’d be highly surprised if products containing palm oil were not present in the homes of the Green Party MPs.  That said, this serves as a timely reminder to ensure dry feed is stored appropriately,” Mr McKenzie concluded.

Feds biosecurity spokesman John Hartnell responded earlier to criticism on the use of PKE as cow feed by Greenpeace saying PKE was a waste by-product left over from the processing of palm oil for consumer products.

“Palm kernel has so little commercial value that if it isn’t recycled into supplementary feed, it is burnt.  That doesn’t sound too great for either climate change or the environment. . .

“Palm plantations aren’t created just to generate a waste by-product, just as newspapers don’t exist solely to support recycling. . .

He said there was a genuine problem with PKE which Feds had been concerned about.

“”Yet for a long period of time, Federated Farmers has been questioning the biosecurity risks posed by what seems to be a great amount of uncertified palm kernel entering New Zealand.  There’s a huge biosecurity hole posed by the stuff.”

That risk is not the risk of fungi mentioned in the preliminary draft report.

Because of some silly treaty . . .


Can you pick and choose which parts of a treaty you abide by and which you don’t after you’ve signed it?

If you want to be trusted, as a country and government, I don’t think so without further negotiations. Sue Kedgley has another view:

. . . but she says we have to go ahead because of some silly treaty with Australia, . . .

She was referring to Food Safety Minister Kate Wilkinson during the Q & A discussion on adding folic acid to bread.

The possible risks of adding folic acid to everyone’s diet have been highlighted.  This post by Macdoctor  puts another side to the story and Otago University specialist in human nutrician, Professor Murray Skeaff says there’s no evidence adding folate to bread will increase the risk of cancer.

However, the opposition is likely to be based at least as much on emotion as science.

Regardless of the emotion and science there is also opposition to mass medication in general. I have a great deal of sympathy with that view, especially when it is aimed at a very small percentage of the population – women who are pregnant or about to be.

If taking extra folic acid can prevent birth defects it should be encouraged, but education for those who need it rather than medication of us all would be my preferred strategy.

I hope Wilkinson does everything she can to at least delay the compulsorary addition of folic acid to our bread.

However, if New Zealand signed a treaty with Australia, that may not be easy because we can’t just pick and choose which bits of a treaty we adhere to, even if it was a previous government which signed it.

If there’s a problem with its effect, there’s a process the government will have to go through to resolve it.

Disregarding the treaty because it’s “silly” isn’t an option because that would call into question New Zealand’s commitment to every other treaty it has signed.

Fear of freedom leads to storm in lunchbox


The Greens still haven’t learned to pick their fights:

Greens health spokeswoman Sue Kedgley yesterday started a petition to persuade the Government to yield to public pressure.

In effect, it asks for the re-introduction of the ban on regular sales of unhealthy food and drink in schools.

What is it about freedom which frightens some people? Is it that with freedom to choose goes the responsibility to exercise that choice wisely? 

If there is sufficient public pressure for re-introducing the ban then surely there is no need for one because the public will not allow their children to eat the food they object to and will have worked with the schools their children go to to ensure that ban or no ban only “healthy” food is available in their canteens.

Or does the pressure for prohibition mean the public doesn’t have the courage of their convictions and have been unable to persuade their children and their schools to do what they think best and so want the government to use compulsion?

This is all just a storm in a lunch box because lifting the ban doesn’t compel schools to change what they’re providing. They still have a responsibility to provide “healthy” options and teach children about good nutrition.

A couple of what Poneke calls celebthorities have joined the campaign and one, Rob Hamill, shows he’s better at rowing than logic with this comment:

“If it’s about freedom of choice, why can’t we sell cigarettes in schools? … We know it’s wrong.

“If we are putting crap food in the diets of kids, not only are they going to underperform, it’s going to set a habit for life.”

The difference between cigarettes and food is that even one cigarette causes harm but while nutritional value varies, there is no junk food only junk diets. If the children are eating a balanced diet the odd suasage roll, pie or cream bun isn’t going to hold them back.

The real problem isn’t about what’s offered in school canteens it’s what the children eat most of the time and those concerned about children’s development would achieve more by working to provide breakfast for children who arrive at school hungry than they will by calling for a ban. 

Hat Tip: Kiwiblog who thanks the Greens for reminding us about the growth of nanny state under Labour.

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