Cooperative dairying is under serious threat in New Zealand, according to Bill Quest, operations director of Farmers of New Zealand.

He advised anyone doubting that companies in private ownership were taking over milk processing to visit Pokeno, where Chinese firm Yashili is setting up a NZ $ 220 million (€147 million) milk drier capable of producing 52,000 tonnes of infant formula annually.

Pokeno makes Fonterra’s Maungaturoto dairy factory look like a dog kennel, according to Mr Guest.

He went on to say “Talley’s have consent to build a dairy factory at Moerewa, Wayne Brown is going to build an ice cream factory at Kerikeri, the purchase of seven Pinney Farms south of Kaikohe for $42 million and the Chinese are coming to Northland.”

The farm leader has claimed legislation compelling Fonterra to supply milk to prospective competitors opened the way for rivals to get established.

He also said “Fonterra started with 96% of NZ milk supplies, but is now below 86%," thereby accusing the government of not being farmer friendly. "John Key is business friendly but does not care about farmers so long as overseas investment funds keep rolling in”.

Mr Guest wants Theo Spierings, CEO Fonterra to slash his $4.18 million annual salary in line with the cuts of the rest of the staff in Fonterra.

He feels that the wheels are flying off NZ’s dairy farmers businesses and they need leadership that will bring back confidence to the Co-op.

Fonterra chairman, John Wilson and two other directors are up for re-election at this year’s annual meeting and Mr Guest suggested dairy farmers send a strong message in that poll.