A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

New Zealand sets prices on the global milk market

May 20, 2013


Fonterra, New Zealand’s dairy cooperative and the world's largest exporter of dairy produce have announced the implementation of a pilot project that will protect its members from hyper-volatility in global prices and the instability of New Zealand dollar, thus ensuring stable milk prices from one season to another. This program will take place over a period of 12 months, running until 31 May 2014. It will guarantee its participants a price to the amount of 75% of the milk sold to the cooperative group. The GMP (guaranteed milk price) should count up to 200 participants.

Beyond the advantages this aid would offer New Zealand’s producers, the program raises a far more complex and crucial question: what will the global impact be on its dairy industry after this new item is added to New Zealand’s arsenal of (often hidden) aid, when Europe is dismantling its aid policies and its farmers are exposed unsustainable global prices?

Instability in dairy markets is historical and structural and New Zealand’s decision could be an aggravating factor. As the world’s leader in milk, New Zealand, via Fonterra, directly influences global dairy produce prices. Most countries that serve as a benchmark are those that destabilize global markets the most. Fonterra is well known for being a state-owned trading company with a monopoly on exports that does not respect the rules of international competition, while enjoying critical structural advantages.

The situation almost seems Kafkaesque. How can an activity that is strategic to the correct functioning of the entire global economy be financed when its prices are dictated by the rule of the lowest bidder, which inevitably leads to destructive competition between the different markets?

It is urgent that regulatory mechanisms adapted to the specificities of agriculture as well as policy requirements be maintained for the return of healthy and ethical competition, because maintaining the situation in its current state means that the distortions generated on world markets are being underestimated by disguised aids and misrepresents the reality of a model that is presumed to be competitive and non-interventionist.
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Paris, 19 December 2018