Fonterra Supports Farmers with Interest-free Terms
NEW ZEALAND - Fonterra is lending up to NZ$15 million to the Co-operative’s 50 per cent owned subsidiary, RD1, to enable the rural retailer to extend interest-free terms for farmers on essential dairy supplies.
10 July 2009
1 minute read
Fonterra Director Milk Supply, Barry Harris, says the interest-bearing short-term loan to RD1 Limited is part of a package of targeted initiatives by the Co-op to assist its farmers under financial pressure due to the current lower payout environment.
"It’s a tough time for our farmers and we have been looking at every avenue we can to help them, particularly in finding ways to cut costs and manage cash flows while continuing to keep their farms productive.
"This opens up another option and some flexibility for farmers needing essential supplies to keep their farms running in what is going to be a difficult season for many."
Mr Harris says the loan will be fully repaid to Fonterra by 30 April 2010 and that RD1 will fund the interest costs of the loan.
RD1 CEO, John Lea, says RD1 will be promoting the details of the offer to farmers over the coming months, and continuing to offer practical advice about managing farm input costs.
"We have a real partnership with our dairy farmer customers, and it’s great to be able to offer this additional flexibility at a time when things are so tight.
"The other good news is that we’re seeing international prices come back for major inputs like fertilisers, which will flow through to farmers as we go through this season," Mr Lea says.
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