One Question Quiz
You’re welcome.
You’re welcome.

The BulletinSeptember 14, 2018

The Bulletin: Fonterra under scrutiny after big loss

You’re welcome.
You’re welcome.

Good morning, and welcome to The Bulletin. In today’s edition: Milk and money spills at Fonterra, Coasters told they’ll have to leave after threats from rising seas, and deputy PM Peters addresses coalition rift rumours. 

In the end, Fonterra’s year turned out to be worse than a lot of people were predicting. The dairy cooperative has announced an annual loss for the first time ever, and it wasn’t a small one either – $196 million. That the result was going to be bad news was well telegraphed, but the scale of the loss has surprised some. What went wrong? New business editor of The Spinoff has a cheat sheet explaining how our biggest company went into the red.

Fonterra’s involvement in China has been seen as the key driver of the loss, particularly their investment in Beingmate, which turned out to be a disaster. This analysis from Stuff outlines that, and notes that Fonterra certainly aren’t the first NZ company to go overseas and lose their shirt in the process. There are suggestions that Fonterra might look now to scale back, and focus more on NZ operations, which are largely ticking over fine. Fonterra is also carrying some serious debt at the moment, reports The Country.

Leadership of the cooperative has also come under scrutiny, given both the CEO and Chairman have gone in the past year. Outgoing CEO Theo Spierings wasn’t at the announcement, and hasn’t really fronted at all since stepping down. Regional economic development minister Shane Jones – never shy about his views on Fonterra – has urged the new Chief Executive Miles Hurrell to start firing some underpaid executives, reports the NZ Herald. Jones says it’s not the product that is the problem, it’s the people.

Finally, the cooperative is being accused of that most human of failings – hubris. Farmers are accusing Fonterra of over-promising and under-delivering, reports Stuff, and as One News reports, butter price forecasting was far too optimistic. From here, the cooperative’s leadership say they’re going to review basically everything they’re doing financially, which given Fonterra’s importance to the rural economy, will be welcome news to farmers.

Residents of small West Coast settlements north of Greymouth have been told they’ll have to move in future to escape rising seas, reports Stuff. Sea walls won’t be anything more than a temporary solution, and houses in the villages of Hector and Granity get damaged when there are big storm surges. Some residents don’t want to leave though, and are quite literally trying to hold back the tide with protective measures.

Deputy PM Winston Peters has dismissed suggestions that there are rifts in the coalition government, reports the NZ Herald. Though in fairness, that’s not really the charge people are making – they’re saying that the coalition is united in agreeing that Mr Peters is the one with a veto power over policy. Over on Newstalk ZB, National leader Simon Bridges has given Jacinda Ardern a rather backhanded compliment, saying she’s “too nice” to be PM. And as Danyl McLauchlan writes on The Spinoff, the nature of the relationship means there isn’t an awful lot PM Ardern can do about it, short of ripping up the coalition agreement.

Remember those dead birds the anti-1080 protestors turned up at Parliament with? They weren’t killed by 1080. Rather, as Newshub reports, they were killed by “blunt force trauma” akin to being bludgeoned over the head. Complaints have now been laid with the Police and DOC, as the birds were protected species. One of the protesters denied that his group had killed the birds, reports Radio NZ.

The first Auckland councillor of Asian descent has been elected, with Paul Young winning the Howick by-election, reports the Howick-Pakuranga Times. Mr Young, a businessman, settled in Howick 30 years ago, and is an advocate for shuttle buses to connect up to public transport hubs, and law and order policies. It was a reasonably close-run win, with Mr Young winning 7293 votes, and three other candidates cracking 5000.

First they took away our pseudoephedrine, and now they’re coming for codeine? The front page of the Dominion Post today reports that over the counter codeine sales are to be quietly banned in two years, in a move that has outraged some. But others, including former addicts, say it can be a gateway to becoming addicted to opioids, and are praising the move.

The IRD has no team to monitor property speculator compliance with the bright line test, but 64 staff to chase down students who go overseas for their loans, reports Newsroom. This is despite pretty low rates of compliance with the bright line test, and the fact that most property speculators are probably in a financial position to pony up with what they owe. Revenue minister Stuart Nash admits it could send the impression that IRD has backwards priorities, but targeting students who go overseas is more about being proactive – he doesn’t want to see the interest on their loans balloon to unmanageable levels.

It’s not the end of the show by any stretch, but today will be the final edition of Checkpoint with John Campbell on Radio NZ. He’ll be replaced by Lisa Owen, who is heading over from Radio Live, and will himself be off to TVNZ to pick up a roving brief. It will be very interesting to see what he gets up to there.

The Bulletin is The Spinoff’s acclaimed, free daily curated digest of all the most important stories from around New Zealand delivered directly to your inbox each morning.

Sign up now

Sara and Melanie’s wedding features on Together Journal’s October cover. (Photo: Charlotte Sowman)

Right now on The Spinoff: Our latest book extract is from former PM Bill English, who reflects on a 2017 campaign which – all things considered – he really quite enjoyed. Maria Slade writes about a New Zealand wedding publication that is believed to have done a world first by putting a same-sex couple on the cover. And the Real Pod is here for another week, talking about how The Bachelor Australia is descending into hitherto unseen levels of self-parody.

Normally for a news bulletin there will be too many pieces produced for everything to make the cut, but that’s not necessarily the case on weekends. I used to work a lot of Saturdays and Sundays, and sometimes you’d be scrambling pretty hard to produce copy for the last few slots. Shows like Q+A on TV One were vital on those days, because they do good hard news interviews that produce interesting angles. But about two months ago the show moved into a more primetime slot – 9.30 on Sunday night – which has dramatically cut down how much pickup other media give their interviews, because of the way the news cycle works.

That’s the argument made by Media Scrum – made up of bloggers who work in newsrooms around NZ. It’s a site I’ll certainly be reading more of, because they’ve got a very clear understanding of exactly how the sausage gets made, as it were. Here’s an excerpt from their piece about weekend news:

“But Q+A has also broken some notable political stories in the past couple of weeks that took several days before everybody else noticed. There might be more people watching at that hour, but their stories are less likely to get picked up by the greater media scene.

When it was on in Sunday morning, editors and producers desperate to fill space would find a golden quote or two in Q+A’s interviews and stories, and it would get picked up by all sorts of outlets, with all the proper attribution to the source. Nobody really liked to make too big a deal about it, because it is a rival’s work, but it helped fill a gap.”

Ma’a Nonu is returning to the Blues, reports One News. I admit, when there were rumours about this a few weeks ago I thought it was a joke, but here we are. The 36 year old World Cup winner has just wrapped up three years in France, and it’s not yet known if he’ll also try and push a case to get back in the All Blacks.

We talked about the Silver Ferns making a bold foray into democracy earlier in the week, and the results are in – returning midcourter Laura Langman will lead the team, reports Radio NZ. That means former captain Katrina Grant will now be the deputy. The match against England tomorrow night will be absolutely fascinating, as a test of whether the Ferns have put a disastrous year behind them.

From our partners, Vector’s Beth Johnson writes that if you get a cheque in the mail, no, it isn’t a scam. It’s just the Loss Rental Rebate system in action.

That’s it for The Bulletin. If you liked what you read, and know other people who would find it useful, pass on this signup form to them.

This content is brought to you by Vector. If you live in Auckland, they also delivered the power you’re using to read it. And they’re creating a new energy future for all of us, as showcased by the incredible Vector Lights in partnership with Auckland Council.

Keep going!