An agribusiness expert says NZ First’s policy to divert 500 million litres of milk from about 250 Fonterra farmers doesn’t solve the problem it intends to. Lincoln University senior lecturer in Agribusiness Management Dr Nic Lees says the policy would de-risk competitors for six years.

“If all it’s going to do is subsidise new competition to come in and set up processing capacity and basically sell commodity products the same as Fonterra, we haven’t achieved anything,” he says.

The proposed volume is about 3% of Fonterra’s milk.

The milk would flow from a New Zealand-owned co-operative to a private rival such as Open Country.

“So potentially you could have 49% of that ownership being based in a foreign country, and therefore the value add of that could potentially just be going offshore.”

Established global players such as Lactalis run billion-dollar brands going back decades.

“To develop a brand to compete with them requires huge investment.”

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