Fonterra in Critical Condition

Fonterra; there is worse to come post August, then more still from October onward.Angry Farmers

I began this story a few months back and woke this morning (6th Aug 2015) to the radio and was listening to the pressure the NZ Dairy Farmer is experiencing from the actions of Fonterra over the past 18 months. It is not understood by my general readers how I make my predictive statements, I don’t mind that at all as the events down the track are evidence that I know what I am talking about.

Fonterra began it’s fall from grace in August 2013. Indicators show that, at that time, a pattern of depression was to affect the Company and much of it was based on the internal assessment analysis of the Company Administration and executives.

 

Then as 2014 came into the light of day, the Company was being ‘King-Hit’ with financial blows and the need for them to be more responsible was being called for. But the responsibility of the Co. Officers was not managed as it should have been. Planning and foresight by Fonterra was sadly lacking in the right areas. Overseas dairy markets were creeping in on the scene, and although I did not know what it was at the time, I saw the problems as clear as birdshit on a window.

2015 is full of crap days for the Company, but more so for the support of the Company, the loyal farmer who is at the mercy of Fonterra’s foresight (poor-sight). Of course, the banks don’t really care, and I only hope that farmers are supported by the Government and kick some sense into Fonterra’s Governance. Fat chance. So what’s next?

A timely Major shakeup, finally began exposing the ‘wear and tear’ to the public in late July 2015.

 

Late August will realize more mess and October is the squeeze month where the lessons will be seen to begin unfolding. I don’t see October being at all friendly as much has to change and internal operatives will redundant. Change is essential as it is critical.

2016 will see hopes rise, but there will be a significant reshuffle in the Company. Actions will likely be forced on the senior management and re-shaping of the Company, and its offshore market activities must take place. The real change in direction will begin from November on in this year. A new set of creative strategies will be instigated as I calculate from the Indicator Trends from the Company’s Profile Graphs I have produced, but the footprint of 2017 is once more not a pretty picture.

Circumstances from market forces and Farmer Activity will show their moves, and, as a speculative point, I would like to see the Farmer taking back their control as the top brass of Fonterra and their gold laden pockets are out of balance.

Either the scenario I have projected acts out in the manner I have suggested, or not, matters not. Although facts can change, and they do, I calculate a down-hill slide of the Company and the Farmer has to take back their control of this now dying Company. Fresh ideas and new movements are being called for and they will happen.

Summary

Dairy New Zealand Limited 25th Aug 1998, which then became NZMP Limited on 21st Dec 2001 and then changed its name again on 8th June 2004 to Fonterra Limited. Fonterra Limited is 99.1% owned by Fonterra Co-operative Group Limited. The problems for this Company started in late 2013 and will undergo a series of ‘necessary’ changes beginning September- November 2016 and things may come to a conclusion at that point. Late 2018 is the first time I see fresh air and new trade winds come to the aid of the Company if it is still around, but if it is, it will be a very different structure.

My projections are calculated from more than 30 years in diagnostic research.

Scientifically yours

Peter Vaughan.

1 Comment
  1. Avatar

    I agree with you Peter. I said a while back that too many farmers were falling into the Fonterra black hole. No it is showing what happens when people give away their responsibilty to others and “let them do their thing”. The farmers of NZ used to be canny people, but the lure of seemingly bigger profits by changing from sheep farming to dairy was too much. NZ needs agriculture and farming but also the value added with productivity that can come with it. AND we need to keep it in the hands of New Zealanders !! Outside cultures are already deep in the process of takeovers and Australia is being hit extremely hard right now with many farmers being thrown off their land to make way for the “newbies” who will take the good clean food back to their own countries and leave the people of Australia and New Zealand eating rubbish at high costs. Hopefully the farmers and the people who benefit from this industry take note and change the tide before it is too late.

    6 Aug, 2015 at 12:14 pm - Reply

Send a Comment

Your email address will not be published.