“We did not foresee the closure of Russia.. we did not see the trouble in the Middle East, or the financial crisis in China.
“We have to look at the dairy scene and to predict geopolitical issues around the world, multiple geopolitical issues in key importing regions is very difficult.” Theo Spiering, CEO of Fonterra
When I began to blog on this blog I wrote about the fact that the US economy was unsustainable and would collapse and that with the collapse of the US China would also suffer a serious set back. The US had at the time a GDP of around $ 7 trillion and that GDP was not based on jobs in the manufacturing and farming communities but on financial speculation and housing bubbles.
All the manufacturing jobs had after all been outsourced to developing countries and China and to keep the illusion of a functioning economy going more and more people were pushed into food stamps while the rich looted the real estate and energy and food production markets.
Because there were no large cues outside of food kitchens the immense poverty suffered by the US population was invisible and with the GDP numbers manipulated to present economic growth instead of the demise of the middle class and around 100 million US citizens on food stamps and on the edge of starvation without healthcare and any chance of meaningful employment it was just a matter of time before calamities would show up in economies around the world.
This was visible to many people around the world and we have been warning people about the pending economic upheaval for the last 8-15 years. So if Theo Spiering, CEO of Fonterra, says Fonterra did not see this coming I seriously doubt the suitability of Mr. Spiering to be running Fonterra.
What is even more shocking is that as dairy farmers are facing the collapse of their farm nobody seems to even want to actually really analyse what will happen in the next 10 years. The argument that global overproduction is the cause of this demise is simply not tenable. Over production is something that one can see coming. It is calculable and can be corrected while there is still a profit margin in the prices asked for the milk. To keep prices high farmers could have temporarily diversified in dry stock or hemp to name a few and corrected the amount of milk produced.
What Theo Spiering and his ilk do not want to see or perhaps do not want YOU to see is the fact that a global economy and financial banking system, depending on fiat money and an ever growing debt is simply not sustainable. A farm of a 150 cows could happily sustain a family and make a good living not even 10 years ago but now farms of 500 to a 1000 are needed to just manage the outrageous mortgages and costs of running a farm and the farmers are again forced to borrow while the price of the milk no longer covers the cost of their farms.
Theo Spiering should be reading blogs like mine. He would have been warned well in advance!