Fonterra to appeal Commerce Commission raw milk ruling

Friday 3rd July 2009

Fonterra is digging in its heels over interpretation of the Raw Milk Regulations, appealing a Commerce Commission decision requiring the giant dairy cooperative to supply raw milk to a third party processor for the Kaimai Cheese and Grate Kiwi cheese companies.

"The raw milk regulations cost each of our farmers around $1000 a year, said Fonterra's Milk Supply Director, Barry Harris. "This is money that they can't afford and the Commerce Commission opens up eligibility for this milk further.

"This is an important principle we have to defend."

Kaimai and Grate Kiwi both sought supply of raw milk to Open Country Cheese Company Ltd, whichwould undertake first stages of processing on their behalf prior to cheese-making.

The commission ruling affirms Kaimai and Grate Kiwi's contention that the regulations require delivery of raw milk to any address nominated by them.

The applications were lodged in mid-2008 and Fonterra did not supply raw milk to either party after October 1, 2008.

As a condition of its creation with a market dominant position, Fonterra was subjected to Raw Milk Regulations which require the cooperative to supply non-Fonterra domestic competitors with raw milk, up to an annual cap of 50 million litres.

Businesswire.co.nz

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