July 13, 2026 • 6 mins
The chief executive of Open Country Dairy fires a shot across the bows of Fonterra, after the dairy co-op cut 50 cents off its forecast milk price yesterday.
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Speaker 1 (00:00):
Mark Delatour is the chief executive of Open Country dairya
second biggest dairy company, obviously behind a Fonterra. Mark, I
want to ask you about what you made of yesterday's
announcement from Fonterra cutting fifty cents from its forecast farmgate
milk price for the season we have just started. But
before I do that, it's kind of a theme this
(00:22):
week football World Cup. You haven't been watching it at all?
Are you not interested in the angst and the battle
between England and Argentina. It is a bit like you
and Fonterra in some ways, if you don't mind me
saying so, Mark, Well.
Speaker 2 (00:37):
God Athon, Jamie.
Speaker 3 (00:38):
There's a lot of comparables there isn't there. Some people
would argue you've got the stature of Diego Maradona, maybe
not the skills, but you know, you start talking about
the hand of God and all that sort of stuff.
Speaker 2 (00:49):
Well you do what you need to do to win,
don't you.
Speaker 1 (00:52):
Jane, Well, the hand of Miles has departed Fonterra. We've
got a new broom in there, Richard Allen. But I
guess it was fair enough, wasn't it. The GDT prices
had fallen eleven percent across the reference products since late May.
It made sense to well, fore warned is forearmed for
(01:13):
the farmer. Surely, how can you be critical of that?
Speaker 3 (01:16):
Well, I guess we're just going to take it with
a grain of salt, you know, Jamie, it's probably a
little bit disappointing. If you look at last season. I
think the farm gain milk price started off at a
ten dollars forecast. I think it was November. You can
in fact check me on this. At the end, Jamie,
I think it was November, dropped a nine fifty a
few weeks later nine dollars, and then you know, I
(01:37):
think last season's going to finish up what maybe a
little under nine seventy. So you know, there's a little
bit of a pattern over reaction here for your listeners.
What I will say, Jamie's going to remember, an auction
is an auction. It doesn't necessarily dictate the market. So
you know, if you're selling your house and there's an auction,
auction day comes along and there's a pile up on
(01:59):
the motorway and only one bit of turns up to
the auction, you may not get the price you wanted,
but it's not an indicator of the true value of
your house. So you know, we don't sell on the
auction at open country. But you know what I will
say is just everyone needs to take it for what
it is and say, right now, I guess we have
(02:19):
the proverbial pile up.
Speaker 2 (02:21):
In the Middle East.
Speaker 3 (02:22):
You know, some of those buyers aren't aren't playing, they
haven't turned up for the auction. And of course it
doesn't take the Chinese and Southeast Asian bit is long
to figure that out. And so you know, let's not
just all assume that after three you know, GDT performances
that aren't great, that the season's doomed. So nothing, We're
some industry players getting together and talking to market down channel.
Speaker 1 (02:44):
Well, the market goes up and down, and that's what
markets do. And it's and you mentioned back to late
last year, at one stage that looked like our payout
or our milk price was going to start with an eight.
Speaker 2 (02:57):
Yeah, exactly.
Speaker 3 (02:58):
So you know, I think what we have to stand
back and watch as a as an industry, as a
producer of proteins and fats. You know, with the g
LP one drugs have just created a huge demand for proteins.
So you know, we can't produce enough. If I had
three cheese factories right now, I'd love it, you know,
(03:20):
Jamie so who can produce the way as much as anything.
But likewise, we've we've got still got strong butter prices.
So again, the dairy industries come through two fantastic years.
And so if you go back a year further into
three years back, you know, whole milk prices right now
probably three hundred dollars a ton better than three years ago,
skim milk six hundred dollars a ton better than three
(03:42):
years ago, and butter five hundred. Not to mention the
the there's about an eleven percent dollar impact on that
three year number.
Speaker 2 (03:49):
Allaw.
Speaker 3 (03:50):
So you know, let's just keep it real, be very
very confident that we're in a good space with demand,
and and let's not make it a self a fitting profit. See,
I think we're gonna be very careful about that and say, okay, yep,
we've seen some auction numbers that aren't pleasing, but let's
not make sure we drop our lip and and give
(04:13):
up all hope because things are still very very good,
and we're talking about a milk price.
Speaker 2 (04:17):
With a nine in it, so you know, let's keep going.
Speaker 1 (04:20):
Yeah, but we are talking about a cost of production
with an eighth in it. Can I just ask you
about why that is, of course a byproduct of the
cheesemaking process. But does cheese and danger of being a
by product of whey?
Speaker 3 (04:34):
Yeah, well, it certainly looks that way just at the moment,
doesn't it. Pardon the pun there, but it's you know,
quite frankly, we're seeing in America right now is way
and to an extent, the fat component driving cheese production
and cheese pricing has come off a little bit. But
in the cheese and then there's cheese, and then there's cheese,
(04:56):
there's cheddar, there's gouda, there's mozzarella. So in each of
those types of cheese have different returns for them. So
it's about producers or cheese being able to make sure
they're covering those markets and getting the most out of it.
Speaker 1 (05:10):
Where's Open Country going to finish on a weighted average
for the twenty five twenty sixth season? Do you know
that number yet?
Speaker 2 (05:19):
Yeah?
Speaker 3 (05:19):
We don't haven't quite finalized the fourth period.
Speaker 2 (05:22):
We're about a month away from doing that.
Speaker 3 (05:24):
We obviously wash up our season and finalize our price
well before our Fonterra finalized their season price. But our numbers,
you know, they're out there in the public domain now,
I think on a way to average basis through about
nine seventy four.
Speaker 1 (05:40):
I think on average, Well, we'll take that. That's not
a bad number at all. Hey, Mark Delator, Chief executive
of Open Country. Derry, thanks for your time today on
the show, and you'll be pleased to know that I
didn't drop you, unlike Ryan Bridge, great broadcaster Ryan, by
the way, on his show you were meant to be
starring there this morning. Wich annoyed me a wee bit
(06:01):
because I don't like it when someone earlier in the
day cuts my lunch. But you got dropped for sir
Sam Neil, so you know we stuck to our guns
here on the Country. We've taken you on instead.
Speaker 2 (06:12):
And I appreciate it, mate. Thank you,
Mark Delatour is the chief executive of Open Country dairya
second biggest dairy company, obviously behind a Fonterra. Mark, I
want to ask you about what you made of yesterday's
announcement from Fonterra cutting fifty cents from its forecast farmgate
milk price for the season we have just started. But
before I do that, it's kind of a theme this
(00:22):
week football World Cup. You haven't been watching it at all?
Are you not interested in the angst and the battle
between England and Argentina. It is a bit like you
and Fonterra in some ways, if you don't mind me
saying so, Mark, Well.
Speaker 2 (00:37):
God Athon, Jamie.
Speaker 3 (00:38):
There's a lot of comparables there isn't there. Some people
would argue you've got the stature of Diego Maradona, maybe
not the skills, but you know, you start talking about
the hand of God and all that sort of stuff.
Speaker 2 (00:49):
Well you do what you need to do to win,
don't you.
Speaker 1 (00:52):
Jane, Well, the hand of Miles has departed Fonterra. We've
got a new broom in there, Richard Allen. But I
guess it was fair enough, wasn't it. The GDT prices
had fallen eleven percent across the reference products since late May.
It made sense to well, fore warned is forearmed for
(01:13):
the farmer. Surely, how can you be critical of that?
Speaker 3 (01:16):
Well, I guess we're just going to take it with
a grain of salt, you know, Jamie, it's probably a
little bit disappointing. If you look at last season. I
think the farm gain milk price started off at a
ten dollars forecast. I think it was November. You can
in fact check me on this. At the end, Jamie,
I think it was November, dropped a nine fifty a
few weeks later nine dollars, and then you know, I
(01:37):
think last season's going to finish up what maybe a
little under nine seventy. So you know, there's a little
bit of a pattern over reaction here for your listeners.
What I will say, Jamie's going to remember, an auction
is an auction. It doesn't necessarily dictate the market. So
you know, if you're selling your house and there's an auction,
auction day comes along and there's a pile up on
(01:59):
the motorway and only one bit of turns up to
the auction, you may not get the price you wanted,
but it's not an indicator of the true value of
your house. So you know, we don't sell on the
auction at open country. But you know what I will
say is just everyone needs to take it for what
it is and say, right now, I guess we have
(02:19):
the proverbial pile up.
Speaker 2 (02:21):
In the Middle East.
Speaker 3 (02:22):
You know, some of those buyers aren't aren't playing, they
haven't turned up for the auction. And of course it
doesn't take the Chinese and Southeast Asian bit is long
to figure that out. And so you know, let's not
just all assume that after three you know, GDT performances
that aren't great, that the season's doomed. So nothing, We're
some industry players getting together and talking to market down channel.
Speaker 1 (02:44):
Well, the market goes up and down, and that's what
markets do. And it's and you mentioned back to late
last year, at one stage that looked like our payout
or our milk price was going to start with an eight.
Speaker 2 (02:57):
Yeah, exactly.
Speaker 3 (02:58):
So you know, I think what we have to stand
back and watch as a as an industry, as a
producer of proteins and fats. You know, with the g
LP one drugs have just created a huge demand for proteins.
So you know, we can't produce enough. If I had
three cheese factories right now, I'd love it, you know,
(03:20):
Jamie so who can produce the way as much as anything.
But likewise, we've we've got still got strong butter prices.
So again, the dairy industries come through two fantastic years.
And so if you go back a year further into
three years back, you know, whole milk prices right now
probably three hundred dollars a ton better than three years ago,
skim milk six hundred dollars a ton better than three
(03:42):
years ago, and butter five hundred. Not to mention the
the there's about an eleven percent dollar impact on that
three year number.
Speaker 2 (03:49):
Allaw.
Speaker 3 (03:50):
So you know, let's just keep it real, be very
very confident that we're in a good space with demand,
and and let's not make it a self a fitting profit. See,
I think we're gonna be very careful about that and say, okay, yep,
we've seen some auction numbers that aren't pleasing, but let's
not make sure we drop our lip and and give
(04:13):
up all hope because things are still very very good,
and we're talking about a milk price.
Speaker 2 (04:17):
With a nine in it, so you know, let's keep going.
Speaker 1 (04:20):
Yeah, but we are talking about a cost of production
with an eighth in it. Can I just ask you
about why that is, of course a byproduct of the
cheesemaking process. But does cheese and danger of being a
by product of whey?
Speaker 3 (04:34):
Yeah, well, it certainly looks that way just at the moment,
doesn't it. Pardon the pun there, but it's you know,
quite frankly, we're seeing in America right now is way
and to an extent, the fat component driving cheese production
and cheese pricing has come off a little bit. But
in the cheese and then there's cheese, and then there's cheese,
(04:56):
there's cheddar, there's gouda, there's mozzarella. So in each of
those types of cheese have different returns for them. So
it's about producers or cheese being able to make sure
they're covering those markets and getting the most out of it.
Speaker 1 (05:10):
Where's Open Country going to finish on a weighted average
for the twenty five twenty sixth season? Do you know
that number yet?
Speaker 2 (05:19):
Yeah?
Speaker 3 (05:19):
We don't haven't quite finalized the fourth period.
Speaker 2 (05:22):
We're about a month away from doing that.
Speaker 3 (05:24):
We obviously wash up our season and finalize our price
well before our Fonterra finalized their season price. But our numbers,
you know, they're out there in the public domain now,
I think on a way to average basis through about
nine seventy four.
Speaker 1 (05:40):
I think on average, Well, we'll take that. That's not
a bad number at all. Hey, Mark Delator, Chief executive
of Open Country. Derry, thanks for your time today on
the show, and you'll be pleased to know that I
didn't drop you, unlike Ryan Bridge, great broadcaster Ryan, by
the way, on his show you were meant to be
starring there this morning. Wich annoyed me a wee bit
(06:01):
because I don't like it when someone earlier in the
day cuts my lunch. But you got dropped for sir
Sam Neil, so you know we stuck to our guns
here on the Country. We've taken you on instead.
Speaker 2 (06:12):
And I appreciate it, mate. Thank you,
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