Image via WikipediaFonterra claims raw material costs lifting milk price - these are exaggerated.
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Fonterra says milk prices are a result of increasing global commodity prices leading to a rise in raw material costs for all diary manufacturers, following outrage from health authorities about milk price
Fonterra is responding to claims it should drop the price of milk.
Northland health authorities claim it is a national outrage that a country that produces 15 billion litres of milk a year cannot supply cheap milk to the domestic market.
But Fonterra's managing director Peter McClure says prices are a result of increasing global commodity prices, leading to a rise in raw material costs for all diary manufacturers.
He says despite trying to absorb as much of these increased costs as possible, the company is continually facing tight margins, with costs going up between 30% and 150% over the last year.
Peter McClure says the final price is set by the supermarkets.
KR says: Was he talking about the price of grass in NZ? McClure was talking through an orifice in his posterior. If Fonterra and the farmers were not so damn greedy and had some consideration for the average New Zealander, some consideration could be given to a domestic market price for dairy products, especially milk.Domestic prices are set by how much the overseas market price is set - prices increase by how much they can get on overseas markets.
Acknowledgements: © 2011 NZCity, NewsTalkZB
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