dairy gold up for grabs, page-31

If you think a super cooperative will lead to increased farm-gate returns you are dreaming. Any efficiency gains will be eaten up by interest and reducdancy payments. Helou's comments re Fonterra's debt gearing during their "expansion phase" are completely misleading. There is absolutley no possibility of a WCB/MG merger resulting in expansion within a bulls roar of Fonterra's growth which was driven by incrased milk production i.e. dairy conversions. Helou comes across as a pompous fool that is quite happy to stir sht in an industry that he will be nowhere near in 3 years time.

Milk cheques paid by high volume commodity dairy manufacturers will always be slave to the world markets. The key to higher supplier payments is value-adding. Value adding requires capital investment. So which of the suitors is positioned to invest in capital? Certainly not MG with their debt from WCB acquistion and new packaged milk plants in Melb and Syd.

The parochial BS that I read in a papers about Australian owned is complely mis-informed. What an opportunity for redneck politicians to appeal to their redneck constituencies!! Where did Kraft come from? They were one of the foundations of the current SW Vic dairy landscape. How much profit do you think is going to go offshore? Look at WCBs and MGs financials for the last 10 years and take notice of the profit over revenue.

Terry McCrann is a right-wing tabloid columnist only equalled by Andrew Bolt. If you take his opinion as independant you are kidding yourself.

Lastly, look at Saputo's record in the US and Argentina. Where they have made acquisitions they have invested in capital. So how can they fill new capital investments with milk? By attracting milk supply. MG and others are seriously concerned (and should be) that the entrance of a new cashed-up player into the scene will make retaining supply difficult in the best dairy region in Australia, which means decreased efficiencies for these manufacturers.