Fonterra's increased dividend payment isn't enough for most farmers to pay their interest bill, says University of Waikato Professor of agribusiness Jacqueline Rowarth.
Speaking on the The Economy Hub video show Rowarth said Fonterra's payout was still below the cost of production and farmers would not be happy despite what looked like a strong result on paper.
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Fonterra yesterday delivered a half year profit of $409 million and doubled its interim dividend to 20c per share, which it will pay earlier than usual to help struggling farmers.
But most farmers would not be happy with the result, Rowarth said. Farmers felt Fonterra was behaving more like a corporate than a cooperative and the costs of the administration were still too high.