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Fonterra follows on from Murray Goulburn

Following on from Murray Goulburn’s (MG) announcement last week, Fonterra made a similar
announcement yesterday.

It is important to note that the actions of MG and Fonterra in late April/early May last year has caused enormous heartache for farmers and the industry.
Those impacted were hit hard and it will take a long time for the farmers to recover and rebuild not just financially but their herd sizes, their confidence,
and their emotional well-being.

These financial hits on farmers should never have happened.

Through no fault of their own, farmers who left MG or Fonterra, did so because they had no other financial option. The lack of reimbursement to these farmers
from the MG MSSP and the Fonterra Australia Support Loans Package respectively appears discriminatory and unfair.

While ADF acknowledges that both MG and Fonterra will be reimbursing existing (and retired) suppliers, they have both made a point to deny those farmers
who are no longer suppliers, yet were equally financially disadvantaged.

ADF believes that farmers who were financially forced to leave their processor should not be forced to continue to bear the cost of processor actions.
There are serious questions that must be answered about the fairness and equity of the financial impacts and treatment of those who had to move to
other processors.

Trust and respect are important parts of any business relationship and this has been lost for many farmers who supplied and currently supply MG and Fonterra.
Not only has trust and respect been damaged but so too has industry confidence, and this will take a long time to restore.

To ensure a positive future, our industry relies on all the elements to operate effectively. Now more than ever, the dairy industry needs to remain focused
and united in its goals to achieve a shared vision of improving the profitability and sustainability of dairy farmers and the entire dairy industry
in Australia.

ADF will continue to work with both processors and farmers to rebuild confidence and trust. It will take time and will require a commitment by processors
to treat their farmers as equal partners and with the respect they deserve.

John McQueen

Interim ADF Chief Executive Officer

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