Farmers take stick to culture vultures

Bonlac Foods, an Australian dairy company controlled by New Zealand dairy giant Fonterra, is battling to support Australian Government moves for a bilateral free-trade agreement with the United States.

Bonlac chairman Noel Campbell this week put a verbal boot into Australia's film and television industry for its attack on the proposed agreement.

He said it was disappointing to hear Australia's actors talking about not trading culture "for a few lamb chops", Melbourne's Age newspaper reported.

In the past week, the Australian film and television sector has ramped up its attacks on the agreement, demanding it exclude cultural and social institutions.

Campbell told shareholders at the annual meeting in Melbourne that the Australian dairy industry needed to be more vocal in promoting free trade.

The United States is already Australia's fourth biggest dairy market in value. The proposed bilateral free trade deal is expected to offer Australian farmers significant benefits not available to their counterparts in New Zealand.

"It's about whole communities," said Campbell. The actors' stance highlighted the lack of profile that the Australian dairy sector had with the Government.

"They've got a profile we've never been able to get ... it's the squeaky wheel thing," he said.

Australian Trade Minister Mark Vaile is in the US for talks with his American counterpart about the proposed agreement, with formal negotiations set to resume next week.

Before he left, Vaile said Australia may be willing to settle for less local film and television content in return for greater economic benefits in the deal.

Asked whether the Government would agree to cut local film and television content for greater economic benefits in the trade deal, Vaile said: "If I can be creative in terms of being able to continue to deliver an opportunity to encourage and deliver Australian culture, then yes."

The audio-visual sector fears it will lose protection, such as quotas for Australian content, under the deal.

Other farming sectors, such as the sugar industry, which also sees huge windfall benefits in free access to the US market, have accused the film and television sector of claiming a monopoly on Australian culture.

But the entertainment industry has said it is trying only to ensure Australians have a chance to see and hear their own stories in years to come.

Campaign chairman Geoff Cox said farming was just as important to Australian culture as television and film.

"Film is already one of the most highly protected Australian industries with a 55 per cent local content requirement for TV and 80 per cent local production requirement for advertising.

"While just about everyone else is trying to reduce trade barriers, these people are trying to increase them."

Fonterra Co-operative Group effectively controls Bonlac Foods because the deal giving it a 50 per cent stake last September also gave it day-to-day control of management. Bonlac's board is technically able to sack Fonterra as manager on grounds of poor performance, but Fonterra has half the seats on Bonlac Foods' board, and would need to vote for its own removal.

"Savoy clauses" are also triggered in the event of a board deadlock, and require one of the 50 per cent shareholders to buy the other out. If this occurs, the odds are overwhelming that Fonterra, the much stronger company, will move to full ownership.

And Fonterra has appointed its own staff to key positions, such as Bruce Donnison, formerly manager of Fonterra's big factory at Edendale, near Invercargill, who is now general manager of Bonlac Foods.

At this week's Bonlac meeting, Donnison, in his first address to shareholders, said the company was on target to achieve its aim of $35 million to $38 million savings this year. After 80 days of the alliance, $26.9 million had been saved, he said.

A senior director of Fonterra, former deputy chairman Greg Gent, has predicted bilateral free trade agreements are more likely to succeed than multilateral ones such as that of the World Trade Organisation.

- NZPA