Mooney JosephJOSEPH MOONEY (National—Southland): Oh thank you very much Madam Speaker. It's a pleasure to rise and speak on the Dairy Industry Restructuring (Fonterra Capital Restructuring) Amendment Bill (DIRA bill) this evening on behalf of the National Party. This bill enabled the formation of Fonterra in 2001 and manages risks arising from Fonterra's dominance on New Zealand dairy markets.I heard a few words from the Green Party before and I think I'll just clear something up as I get into this. New Zealand dairy farmers have the world's lowest carbon footprint at half the emissions of other international producers—half the emissions of other international producers. New Zealand has approximately 5 million people and about the same number of cows producing 21 billion litres of milk every year—the eighth-largest dairy producer in the world with 11000 dairy farmers. Now Brazil by way of contrast has four times the number of dairy cows over 20 million but produces less than twice the amount of milk 36 billion litres with a huge 900000 dairy farmers. So just to put it in context with a significantly smaller four times' smaller herd we produce an incredible 21 billion litres of milk with the most carbon efficient footprint in the planet because our dairy farmers are incredible. I just want to put that on the record.I should just say dairy farming has carried this country through the pandemic like our agriculture industry has done an incredible thing for this country. Dairy exports in the year to June 2022 reached a record high of $22.1 billion in export revenue and make up 3.1 percent of our GDP. New Zealand's dairy industry is of significant national interest and that is really important that we recognise that and we recognise that these are the most efficient dairy farmers on the planet.This bill regulates Fonterra's activities to ensure efficient operation of a dairy market with contestable goods and services in the face of a forecasted static or declining milk production. I should make that clear New Zealand milk production is flatlining and expected to fall. That needs to sink in—expected to fall. So that is not something many people I think who are attacking dairy farmers in New Zealand actually understand. So this capital restructure aims to ensure that Fonterra's factories remain full of milk by making it easier and cheaper for those wanting to join the cooperative to buy shares in order to be able to supply milk. Fonterra collects just 80 percent of the country's raw milk. When it was created under the enabling DIRA legislation 21 years ago it controlled 96 percent. So it's down from 96 percent to 80 percent.Just to keep another factor in mind that's probably quite important New Zealand's second biggest dairy producer Open Country Dairy has said that it had a 40 percent lift in demand for product from its Australian customers. That was just published yesterday: a 40 percent lift in demand from its Australian customers. The Australian milk pool is declining and limiting milk supply and so New Zealand dairy exports to Australia in the first nine months of this year earned $8.6 billion compared to $7.3 billion in the full financial year prior. So Australia's milk production is falling they need our milk they're getting it from New Zealand. This is actually really important and combine that with our flatlining and expected to fall milk production in this country. So we've got a very different market ahead of us. This bill is aiming to try and do a little bit to support Fonterra and the milk market.Fonterra's farmer shareholders voted in support of the changes in December last year. The changes in this bill will see Fonterra adopt a more flexible shareholding structure allowing farmers to hold fewer shares and widening the pool to include sharemilkers contract milkers and farm lessors as associated shareholders. Fonterra's competitors don't require farmers to purchase shares to supply milk and Fonterra has had concerns that it will become a smaller less efficient business that would continue to lose milk supply without this amendment forcing factories to close and reduce farmer milk payout.As a large-scale farmer-owned cooperative Fonterra can invest in innovation and sustainability when capital is freed up. In the face of this forecast a static or declining milk production the amendment will enable it to better compete for farmers' milk supply and efficiently use its existing processing infrastructure.The bill supports the new capital structure intended to reduce long-term risks to the sector increases the number of Ministerial nominees to Fonterra's milk price panel from one to two requires an independent chair gives the Commerce Commission power to issue binding directions to Fonterra supports liquidity and transparency in the share trade of Fonterra shares and requires Fonterra to maintain and publish a dividend and retentions policy. With that I support this bill.