KEY POINTS:
Dairy farmer reaction to Fonterra's proposal to float part of its business on the sharemarket was cautious but positive during seven meetings held nationwide yesterday.
A live video link from the Christchurch base - where management and the board made their pitch - was beamed in to large
gatherings in Whangarei, Hamilton, Stratford, Palmerston North, Nelson and Gore.
This enabled thousands of shareholding farmers to begin dialogue directly with Fonterra chairman Henry van der Heyden and chief executive Andrew Ferrier.
Outside the Mystery Creek, Hamilton, meeting, attended by about 1200 people, Bay of Plenty Federated Farmers president Pukehina farmer Derek Spratt said the presentation was well explained and professional.
"I'm excited and support it in so far as the principle is concerned, but the devil could be in the detail. There's a whole lot of stuff to expand on after what's been delivered today."
It was a "huge decision" not only for farmers, but also for New Zealand as a whole.
He was comfortable with the safeguards outlined, which gave assurances farmers would never lose control of the company, and that no institution or person outside the co-operative could hold more than a 10 per cent stake in it.
The largest shareholder in thecompany at present owns less than2 per cent of the shares.
Brian Willis, who runs a 420-cow operation on 160ha at Eureka, said he was "all for" the proposals.
"If you stagnate in this industry you're going backward. But they're going to have to keep consulting widely, and approval can only come at the grassroots level."
Paeroa farmer Kevin Cressey said he was employing a "wait and see attitude".
"I'm very uneasy with a sell-off and what we're going to be left with. I do have erosion of ownership concerns and yes, I'm nervous."
A farmer near Hamilton, who would not be named, said he was positive about the changes but could understand why some were not. "Some people in that meeting have been through the slump years and they're always a bit reluctant to change."
A video clip, titled "The case for change", was part of the presentation.
It explained that the global dairy trade was expanding at an annual rate equivalent to the entire New Zealand industry every year, and that this was forecast to continue for 10 more years.
Other countries, including China, India, South America, Europe and the United States, would fill market gaps that New Zealand would leave exposed if it did not brace for expansion.
While the co-operative's balance sheet was healthy enough to sustain short-term goals, in the medium term Fonterra would need much more equity to finance its planned growth strategies.
That is where a public listing on the sharemarket came in, and Mr van der Heyden acknowledged "constructive tensions" could exist between investor and farmers when it came to dividends versus milk prices.
"Those guys have been taking lessons from Goebbels," said Te Kawa man Johan de Wit, who said he was representing his boss at the meeting.
Mr de Wit said the plans marked the beginning of the end for the co-operative.
But Mr de Wit's views were clearly in the minority, with many farmers acknowledging the need for change so the business could take advantage of global opportunities.
Shareholders' council chairman Blue Read gave farmers an assurance that his team's objectives did not necessarily align with the objectives of the Fonterra board.
The council would consult farmers over the next few months to get a better gauge of whether the proposal was acceptable to New Zealand farmers, now the only shareholders in the company.
"This is the start of the consultation and there is still a lot more detail to come. Once the council has heard farmers' views and fully debated the issues, we will state our position on the preferred option."
