The core of the issue is that selling off brands like Anchor and Mainland to companies like Lactalis sacrifices the value created by a long-term connection with consumers. The author contends that Fonterra’s true strength lies in its integrated farm-to-brand model, which has built a reputation for trust and quality. By abandoning this model, the cooperative risks becoming a generic ingredient supplier, a position that leaves it vulnerable to market swings and competition.

This strategy is particularly concerning for the New Zealand dairy cooperative’s farmer-owners. The author argues that a shift away from high-value consumer products will likely result in lower returns and less stability for farmers. While the cooperative model is built on shared risk, a strategy that intentionally reduces a key source of profitability is seen as a betrayal of the farmers’ long-term interests and a dangerous path for the future of agribusiness.

The opinion piece highlights a fundamental disconnect between the cooperative’s current leadership and the original vision of its founders. The founders believed that true value was created by converting raw milk into consumer-ready products. The current strategy, however, prioritizes a simpler balance sheet over a diversified revenue stream, which, according to the author, is a narrow-minded approach that fails to recognize the complex dynamics of modern dairy economics.