[13 August/ National Business Review]

Primary Industries Minister, Nathan Guy said independent processors collected 22 percent and 9 percent of all milk solids in the South and North Island’s respectively, triggering the expiry of pro-competition provisions under the Dairy Industry Restructuring Act (DIRA) in the South Island. Mr Guy said he was encouraged by new processors entering the market as it increased competition in the dairy industry. The Commerce Commission is currently investigating whether the act’s 20 percent supply thresholds have been met, freeing Fonterra from its obligation to supply milk to smaller competitors. Mr Guy said that while the percentage of milk collected was an indicator of competition, it was not definitive. Mr Guy added that the government will consider next year whether to promote changes to legislation to extend the duration of the pro-competition provisions, or provide a transition pathway to deregulation, or a combination of both.