I’m a strong supporter of the Fonterra approach. Worked on their legislation. They get some real advantages from it although there are parts which give their competitors an easy run. There is a debate starting around their domestic pricing structure and the Commerce Commission is involved.
Fonterra collects and processes around 90% of New Zealand’s raw milk. In the absence of a competitive market, it is the default setter of the milk price for wholesale and, ultimately, retail.
However I think with their enormous legislative advantage there comes a moral obligation to minimise domestic milk and milk product prices. I hope the Commission does a full investigation and we get a good look and pricing model choices.