Money is still being poured into milk

Ele at Homepaddock strikes a positive note of the sort Alf hoped to hear, the morning after the Stats Department reported a 0.9% contraction in the economy in the December 2008 quarter.

It was the fourth consecutive decline in economic activity, as measured by Gross Domestic Product.

A major cause of economic weakness was residential construction (down 14% in the December quarter alone). This contributed to a quarterly drop of 5.3% in gross fixed capital spending.
Export volumes were down 3.3% but farm output increased 4%, offsetting a 3.8% drop in manufacturing.

There’s no sign of an economic recovery and people are being laid off from their jobs up and down the country.

Waking up to a dose of something positive was just the ticket.

Ele draws attention to a Rural News report about former National leader Don Brash and Meridian CEO Keith Turner being directors of New Zealand Milk which is planning to build a factory to produce skim and whole milk powder near Glenavy, just north of the Waitaki river.

South Canterbury suppliers will be spoiled for choice, she points out – New Zealand Dairies has a factory at Studholme, near Waimate, and Fonterra has a factory at Clandeboye, north of Timaru.

In spite of the uncertain outlook for commodities in international markets, this indicates that there’s still plenty of people who believe that where there’s milk there’s money to be made.

Alf likes to think that blokes of Brash and Turner’s calibre know where the country’s investment money should be directed. Accordingly, he reckons it should be trumpeted to a much broader audience that they are confident about prospects for dairying.

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