Another dramatic drop in global dairy auction prices highlights how reckless National has been in failing to properly diversify the economy, says Labour’s Finance spokesperson Grant Robertson.
“Overall prices dropped by 9.3% in the auction, including a 10.3% drop for whole milk powder, which represents 75% of Fonterra's milk price. These are the lowest prices ever in the global dairy trade auction and the whole milk powder price has halved since March.
“This comes on top of yesterday's ANZ Commodity Price Index which saw the largest ever monthly fall in commodity prices in July, falling to the lowest levels in six years.
“John Key has simply brushed off these plummeting prices, saying that it only affects 5 per cent of the economy. That is just wrong - many regional communities rely on the spending of dairy farmers. Many farmers will now be looking to cull stock, while some will struggle to survive what is likely to be two years of payout well below break-even point.
“It is just over a year since Steven Joyce arrogantly dismissed a potential five year global dairy glut when I raised it with him on The Nation. This kind of complacency is reckless in the extreme.
“New Zealand is good at producing raw commodities, and we should be proud of that. But we know that is not going to be enough to sustain the quality of life we want for our families.
“National has squandered opportunities to support genuine regional economic development plans that focus on adding value to existing industries and supporting a more diverse range of sectors. Instead they have been content to bask in the glory of high commodity prices and lean on the Canterbury re-build.
“It was never good enough, and now the ‘rock-star’ economy is on the skids they are simply in denial. New Zealanders deserve better,” Grant Robertson said.