October 21, 2025 • 6 mins
Fonterra’s chief executive comments on the confusing GDT Auction overnight. He discusses the farmer vote on the sale of Fonterra’s consumer brands and the butter plant at Clandeboye. We also ask why “Big Brother Fonterra” tells farmers how to vote when it comes to the board of directors.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Wednesdays, every second, one price a month. We have a
GDT auction. You wake up a bit earlier in the
morning to see what happens. Now, this man, chief executive
of Fonterra, Miles Hurrell, would have woken up to a
huge rise this morning, but it was a bit of
a false dorn. The initial numbers up twenty one point
nine percent or something like that. Miles. What happened to
(00:20):
your server?
Speaker 2 (00:21):
Yeah, a Jamie, Yeah, there was a bit of a
glitch in the system. So the auction went through sort
of fine, but the data that was published was incorrect,
so that's been redacted and of course they're going to
publish that later today. But what we sense is that
it was in line pretty much with the sort of
huture markets down maybe a couple of percent or thereabout.
(00:41):
So it's not ideal, I guess from a New Zealand perspective,
but in saying that, in line with where we see
the market.
Speaker 1 (00:48):
At the moment, ten dollars under thread, well not.
Speaker 2 (00:52):
At this point. We'll go and do the numbers once
we get clarity on what that looks like. But you know,
we signaled right from the outset that you know, we're
the international market. It's at the geopolitics and play. We
just need to be mindful. This is still while we
have the spread in there of nine to eleven dollars.
But I think what you've seen is some of that
playing out, you know, in particular North America. You know,
they haven't exported any so we've been into China as
(01:14):
they would have done, you know, this by this time
of year. So there's a lot more feed floating around
the US market, which which leads to a bit more milk.
Of course, Europe's had a pretty good weather position and
milk price which means a bit more. And of course
they come off the back of so that that blue
tongue issue, so you've seen carving a bit later. So
all of that has pointed to a little bit more
milk in the northern hemisphere at a time when you
(01:37):
see them sort of peel away. And of course, you know,
we've had a pretty good start heresls. I think we're
probably at peak peak production in the season this week
or thereabouts, and we're up you know, three or four
percent on this time last year. So all of those
things would suggest a bit more milk and buyers, you know,
they smell a bit of blood and they want to
sit and sit on the sideline. So at this point
(01:58):
I'm not I'm not suggesting ten dollars under threat, but
we certainly need to keep an eye up.
Speaker 1 (02:01):
Yeah, very good September numbers for us, but the likes
of the bottom half of the South Island, especially South
and big dairying area. Now it's been a bit miserable
again down there.
Speaker 2 (02:12):
It has weatherwise. That said, I think there's a bit
more supplementary feed given given sort of where we fork
our prices to be. So there's a bit more important
feed that's sort of going out into the farms, and
so as a result of that, we are seeing production
up right through the South Island. In fact of South
Island's up more than the North at this point too.
So all and all are pretty good start from a
(02:33):
farmer's perspective.
Speaker 1 (02:34):
You would have been an interested spectator yesterday with the
result of the Alliance vote. They romped home in the end,
I suggest next Thursday we'll be talking along the same
lines about the Fonterra vote regarding the sale of the
consumer brands business. How many farmers have voted so far?
Miles Hurrel, Well.
Speaker 2 (02:53):
Don't we know the data yet that it'll come clear
next week, although sentiment from our teams that there's been
early vote has come through quite quite strong from our
from our farmer's yielders. So you know, at the end
of the day, there is a big decision for our
farmers and we've we've provided them the information, you know,
very early so they can make an informed decision. But
you know, from from where we sit, it's all about
investing in our ingredients in our food service business, which
(03:16):
you know, we we've we're back for a long time
and will continue to back into the future. But you know,
it is a big decision and we'll lean into that
next Thursday when we see the data.
Speaker 1 (03:24):
And I know you don't want to talk about this,
but you've got to. You'll be happy that Winston Peters
and Shane Jones aren't Fonterra a Farmer shareholders because they'd
be voting no.
Speaker 2 (03:33):
Well, of course, so what I you know, we know
we know the view from from from Winston he makes
that no apologies from that perspective, but you know it
doesn't surprise that he's entitled to his views, of course.
But you know, as I think you've pulled it out
on many occasions. This is owned by our farmers and
and they'll make the ultimate decision absolutely right.
Speaker 1 (03:52):
He Now, I'm going to have another crack at you here.
Why does big brother Fonterra tell farmers how to vote
on the Board of Director elections.
Speaker 2 (04:00):
Yeah, I mean I think you're referring to the Independent
Assessment Panel. So you know, the board puts out sort
of a skills matrix and the gaps they need to
fill into the future. That gets put to an independent panel.
They put through people that they put their hand up
and out pops those those that will go through the
process that's overseen by the Shielders Council or the Cooperative
Counselors is called now. So you know, I think there's
(04:21):
a pretty robust process around that. At the same time,
it does mean that if you don't get through that process,
you can come through on your own, right, and there's
a few rules around that, but you can come through
on your own so and we've seen that done in
the past quite successfully. So yeah, I think the team
are quite happy with the process. It's it's you know,
it's got a nice robust process around it, with the
(04:42):
likes the independent panel and overseen by the council.
Speaker 1 (04:45):
That's a drafting gate against democracy.
Speaker 2 (04:48):
Oh, I wouldn't call it that. You know, any board
needs to ensure you have the right skills, and you know,
as we look at the sort of the new direction
of the cooperative, you know, it's really important we think
about that into the future. You've got you know, a
couple of board members come off next year. They have
certain skills and I think the board looking to make
sure that they fill those gaps. And so yeah, that's
what it's about. And we'll see what comes through in
(05:09):
that process. I think late November. I think might be
early December.
Speaker 1 (05:12):
Now let's finish on a good news story and you
butter plant for clandy Boy in South Canterbury.
Speaker 2 (05:18):
Yeah, look, we're excited about this. I mean, this is
very much aligned with the sort of strategic direction of
the cooperative. You know, fifty ton of new capacity we're
going to put into into clanny boards. So that's you know,
not quite twenty percent increase on what we currently have
and very much aligned to our international food service and
our ingredients business. A couple of different formats, couples of
types of butter. So you're exciting and very much points
(05:40):
to the direction of where the cops heading. Add to
that the one hundred and fifty million dollars recent announcement
at Eail, another seventy five million at Studham, one hundred
and fifty million and Folly Rare all aligned to the
new strategy. And these are the things that we're trying
to sort of send a message to our farmers that
we have a heck of a future in those areas
that we have skill all that, such as food service ingredients.
Speaker 1 (06:02):
Maybe you need to send the block to Winston to
butter him up.
Speaker 2 (06:07):
Well, you know, I'm heading to Jim's funeral tomorrow, former
Prime Minister's funeral tomorrow, and no doubt I'll run into
a few of the politicians there, but I'll pay my
respects to the former Prime minister and you he's done
a pretty good job for news End over the years
and sad to see him go.
Speaker 1 (06:25):
Yeah, the last of the great farmer politicians. And of
course his son Matt Bolger part of the Fonterra executive
two miles.
Speaker 2 (06:32):
Yes he is, and we were away in Europe last
week as a team and he had to come back
at short notice. So given given Jim took a turn
for the worse at the end, but great to see
Matt and all all his siblings and the grandchildren in
Wellington for his passing. Is as sad as that it is,
it's really nice to see that the family.
Speaker 1 (06:51):
You're all there, Miles Harrel, thanks as always for your
time on the country. Appreciate it.
Speaker 2 (06:55):
Good only thanks Am
Wednesdays, every second, one price a month. We have a
GDT auction. You wake up a bit earlier in the
morning to see what happens. Now, this man, chief executive
of Fonterra, Miles Hurrell, would have woken up to a
huge rise this morning, but it was a bit of
a false dorn. The initial numbers up twenty one point
nine percent or something like that. Miles. What happened to
(00:20):
your server?
Speaker 2 (00:21):
Yeah, a Jamie, Yeah, there was a bit of a
glitch in the system. So the auction went through sort
of fine, but the data that was published was incorrect,
so that's been redacted and of course they're going to
publish that later today. But what we sense is that
it was in line pretty much with the sort of
huture markets down maybe a couple of percent or thereabout.
(00:41):
So it's not ideal, I guess from a New Zealand perspective,
but in saying that, in line with where we see
the market.
Speaker 1 (00:48):
At the moment, ten dollars under thread, well not.
Speaker 2 (00:52):
At this point. We'll go and do the numbers once
we get clarity on what that looks like. But you know,
we signaled right from the outset that you know, we're
the international market. It's at the geopolitics and play. We
just need to be mindful. This is still while we
have the spread in there of nine to eleven dollars.
But I think what you've seen is some of that
playing out, you know, in particular North America. You know,
they haven't exported any so we've been into China as
(01:14):
they would have done, you know, this by this time
of year. So there's a lot more feed floating around
the US market, which which leads to a bit more milk.
Of course, Europe's had a pretty good weather position and
milk price which means a bit more. And of course
they come off the back of so that that blue
tongue issue, so you've seen carving a bit later. So
all of that has pointed to a little bit more
milk in the northern hemisphere at a time when you
(01:37):
see them sort of peel away. And of course, you know,
we've had a pretty good start heresls. I think we're
probably at peak peak production in the season this week
or thereabouts, and we're up you know, three or four
percent on this time last year. So all of those
things would suggest a bit more milk and buyers, you know,
they smell a bit of blood and they want to
sit and sit on the sideline. So at this point
(01:58):
I'm not I'm not suggesting ten dollars under threat, but
we certainly need to keep an eye up.
Speaker 1 (02:01):
Yeah, very good September numbers for us, but the likes
of the bottom half of the South Island, especially South
and big dairying area. Now it's been a bit miserable
again down there.
Speaker 2 (02:12):
It has weatherwise. That said, I think there's a bit
more supplementary feed given given sort of where we fork
our prices to be. So there's a bit more important
feed that's sort of going out into the farms, and
so as a result of that, we are seeing production
up right through the South Island. In fact of South
Island's up more than the North at this point too.
So all and all are pretty good start from a
(02:33):
farmer's perspective.
Speaker 1 (02:34):
You would have been an interested spectator yesterday with the
result of the Alliance vote. They romped home in the end,
I suggest next Thursday we'll be talking along the same
lines about the Fonterra vote regarding the sale of the
consumer brands business. How many farmers have voted so far?
Miles Hurrel, Well.
Speaker 2 (02:53):
Don't we know the data yet that it'll come clear
next week, although sentiment from our teams that there's been
early vote has come through quite quite strong from our
from our farmer's yielders. So you know, at the end
of the day, there is a big decision for our
farmers and we've we've provided them the information, you know,
very early so they can make an informed decision. But
you know, from from where we sit, it's all about
investing in our ingredients in our food service business, which
(03:16):
you know, we we've we're back for a long time
and will continue to back into the future. But you know,
it is a big decision and we'll lean into that
next Thursday when we see the data.
Speaker 1 (03:24):
And I know you don't want to talk about this,
but you've got to. You'll be happy that Winston Peters
and Shane Jones aren't Fonterra a Farmer shareholders because they'd
be voting no.
Speaker 2 (03:33):
Well, of course, so what I you know, we know
we know the view from from from Winston he makes
that no apologies from that perspective, but you know it
doesn't surprise that he's entitled to his views, of course.
But you know, as I think you've pulled it out
on many occasions. This is owned by our farmers and
and they'll make the ultimate decision absolutely right.
Speaker 1 (03:52):
He Now, I'm going to have another crack at you here.
Why does big brother Fonterra tell farmers how to vote
on the Board of Director elections.
Speaker 2 (04:00):
Yeah, I mean I think you're referring to the Independent
Assessment Panel. So you know, the board puts out sort
of a skills matrix and the gaps they need to
fill into the future. That gets put to an independent panel.
They put through people that they put their hand up
and out pops those those that will go through the
process that's overseen by the Shielders Council or the Cooperative
Counselors is called now. So you know, I think there's
(04:21):
a pretty robust process around that. At the same time,
it does mean that if you don't get through that process,
you can come through on your own, right, and there's
a few rules around that, but you can come through
on your own so and we've seen that done in
the past quite successfully. So yeah, I think the team
are quite happy with the process. It's it's you know,
it's got a nice robust process around it, with the
(04:42):
likes the independent panel and overseen by the council.
Speaker 1 (04:45):
That's a drafting gate against democracy.
Speaker 2 (04:48):
Oh, I wouldn't call it that. You know, any board
needs to ensure you have the right skills, and you know,
as we look at the sort of the new direction
of the cooperative, you know, it's really important we think
about that into the future. You've got you know, a
couple of board members come off next year. They have
certain skills and I think the board looking to make
sure that they fill those gaps. And so yeah, that's
what it's about. And we'll see what comes through in
(05:09):
that process. I think late November. I think might be
early December.
Speaker 1 (05:12):
Now let's finish on a good news story and you
butter plant for clandy Boy in South Canterbury.
Speaker 2 (05:18):
Yeah, look, we're excited about this. I mean, this is
very much aligned with the sort of strategic direction of
the cooperative. You know, fifty ton of new capacity we're
going to put into into clanny boards. So that's you know,
not quite twenty percent increase on what we currently have
and very much aligned to our international food service and
our ingredients business. A couple of different formats, couples of
types of butter. So you're exciting and very much points
(05:40):
to the direction of where the cops heading. Add to
that the one hundred and fifty million dollars recent announcement
at Eail, another seventy five million at Studham, one hundred
and fifty million and Folly Rare all aligned to the
new strategy. And these are the things that we're trying
to sort of send a message to our farmers that
we have a heck of a future in those areas
that we have skill all that, such as food service ingredients.
Speaker 1 (06:02):
Maybe you need to send the block to Winston to
butter him up.
Speaker 2 (06:07):
Well, you know, I'm heading to Jim's funeral tomorrow, former
Prime Minister's funeral tomorrow, and no doubt I'll run into
a few of the politicians there, but I'll pay my
respects to the former Prime minister and you he's done
a pretty good job for news End over the years
and sad to see him go.
Speaker 1 (06:25):
Yeah, the last of the great farmer politicians. And of
course his son Matt Bolger part of the Fonterra executive
two miles.
Speaker 2 (06:32):
Yes he is, and we were away in Europe last
week as a team and he had to come back
at short notice. So given given Jim took a turn
for the worse at the end, but great to see
Matt and all all his siblings and the grandchildren in
Wellington for his passing. Is as sad as that it is,
it's really nice to see that the family.
Speaker 1 (06:51):
You're all there, Miles Harrel, thanks as always for your
time on the country. Appreciate it.
Speaker 2 (06:55):
Good only thanks Am
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