Keith Cooper, farmer, professional director and former Silver Fern Farms CEO, ponders on co-operatives in a new column at www.interest.co.nz.
Cooper says there’s no doubt there will be savings from the amalgamation of co-ops, but there will be costs in terms of plant closures and worker layoffs. In addition, while it is simple to calculate the possible synergistic gains from an aggregation, actually banking the gains can be problematical, he says.
He believes that the efforts of farmers and their ginger groups should be focused on how they create value for a new entity to enable that entity to make a good decision
“Focus should be on how a model, contract or obligation can be created to ensure farmer suppliers support any amalgamation with livestock in the future, as that is the backbone of any meat processor amalgamation business case. That will create a “currency of change” for the co-ops.”