FrieslandCampina

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FrieslandCampina is working on incentives for attracting new members

April 10, 2024 - Klaas van der Horst

FrieslandCampina is working on a 'feelgood' package for existing and potential members. This package includes various financial incentives, such as discounts, premiums, and capital liberalization. It is all aimed at maintaining milk supply.

The proposals have now been shared with the members. FrieslandCampina states that these are 'directions for consideration'. Members are expected to make a decision on these in the course of this year. The goal of the entire operation is to keep milk volume stable in a situation of declining milk supply. The directions are articulated in a video that members can watch at home at their leisure.

Deferred Payment
The proposals include a interest-free loan or deferred payment for the purchase of delivery certificates, reintroduction of a volume bonus, for example, for volumes above 1.5 million kilograms, three years of exemption from the entrance premium for new members, and the opportunity for existing members to convert member bonds into freely tradable bonds on the internal market. However, to facilitate this, the credit facility at Rabobank needs to be increased from €50 to €100 million. If there are no buyers for the new freely tradable bonds, FrieslandCampina will ultimately have to buy them back themselves.

FrieslandCampina can seek new members in the Netherlands, Flanders, and in parts of Germany along the border with the Netherlands.

Klaas van der Horst

Klaas van der Horst is a senior market specialist in dairy at DCA Market Intelligence. He also closely monitors developments in politics and agricultural policy.
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