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NZDG Contracts Create "Outrage" in South

Greetings Readers

It seems the NZDG has made an unbelievable error with the new supply contract that has been sent. One hundred and thirty five prospective suppliers were asked to sign on the basis of a $50 per kg of milk solids undersupplied on the contracting volume annually.

It seems an unbelievable clause to be included in conversion farmer's contracts.

The potential for an annual supply variation around a mean of 10 percent must lie with most pastoral based production but an even bigger variation could be expected from newly converted dairy farms.

For a reasonable sized dairy unit contracting 150,000 kilos of milk solids facing a 10 percent production decline the potential for a penalty of $750,000 is $75,000 greater than the value of the season's production.

On those sorts of odds the prospective dairy farmers would be better investing their millions on lotto tickets.

If this is the executive face of the new cooperative industry in action - God help the suppliers.

If such a contract was put out with the confirmation of the directors - what happened to their practical farming judgment?

If it was a typographical error with an extra zero or incorrect description - a fortnight seems a long time to let an error float.

Then perhaps it never happened at all.

Good farming




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