5 Jun 2012

TAF changes reassure dairy farmer representative

1:54 pm on 5 June 2012

A dairy farmer representative says he is reassured by the changes Fonterra has made to its share trading proposal.

The Trading Among Farmers (TAF) would allow farmers to trade shares between themselves and also allow for a separate Shareholders Fund from which outside investors could buy the dividend rights of farmers' shares without having voting powers.

Federated Farmers' dairy chairman Willy Leferink was concerned that the Shareholders Fund could spiral out of control resulting in a loss of 100% farmer ownership of the cooperative.

Mr Leferink says he was pleased details released on the scheme showed tighter controls on the size of the Shareholders Fund, restricting it to 20% of total shares.

And he says the Shareholders' Council, which acts as a watchdog for Fonterra farmers, has had its powers boosted.

"I think it was important to give the Shareholders' Council some teeth," he said.

Mr Leferink says the rules on when the council can get engaged are much clearer.

Council chair Ian Brown says 86% of its 35 members are in favour of TAF.

Fonterra's 10,500 dairy farmers vote on the scheme on 25 June.