A month ago there was a message that the chairman of the farmers’ own cooperative, Nortura, resigned with immediate effect. In advance, the chairman had “crossed the Rubicon” and gone to open battle against the CEO; now only one of them could stay seated. But to the chairman’s surprise, the rest of the board sided with the CEO. The consequence was that the chairman of the board passed away for six years. What made Trine Hasvang Vaag put her own position at risk? – It belongs in a boardroom, she has told Bondebladet. Before she added: – But things have happened in the last few months that have weakened my confidence. – We register that there will be political decisions that make it difficult to fulfill the role of cooperative and market regulator, Trine Hasvang Vaag said before she resigned. Photo: Nortura – The co-operative foundations are shaking strongly A look in the news archive tells a little about what has happened in recent months. Or as the county leader in Trøndelag Bondelag summarized earlier this summer: – The co-operative foundations are shaking strongly. The background was the turnaround in June where Nortura terminated the agreement for a chicken slaughterhouse in Trøndelag. The consequence was that 36 chicken producers were suddenly left without a delivery agreement. – We understand that the decision is difficult for those who are affected, but unfortunately it is absolutely necessary if we are to be competitive, explained CEO Anne Marit Panengstuen. At the start of school, Nortura got even more booed when they cut the kilo price of beef by four kroner. The rationale was that they wanted to stimulate sales, which had fallen in line with the general increase in costs. But among their own members, the chief fan was instead blamed for “foaming the whistle”. Increased food prices The comparison of food prices and the wage trend says something about whether you get more, less or the same amount for your money. When the development of food prices is higher than the development of wages, it means that food has become more expensive. Both figures are averages for the specified period. Read more about sources and reservations here. How much food prices have increased in the last year, in comparison with wage trends – We need to think again. In parallel, Nortura is under pressure from new sustainability strategies which say that Norwegians should eat less meat; and from the food giants who create their own value chains completely independently of Nortura. And beneath the surface lurk deeper identity questions about who the co-operative should be and what kind of “Lord” they should serve: Should Nortura be more of a “stock exchange” or a “cathedral”? – We stand in a dilemma between the basic values of the co-operative, the need in society for agriculture and jobs, and the demand for cheap food, says Kjell S. Rakkenes, who is director of strategy at Nortura. He adds: – We have to be brave and we need to think differently. Higher ceiling or strictly business – it is certain that Nortura’s credit rating was downgraded in September. The credit bureau based the downgrade on the fact that it will take time for Nortura to recover from an “extraordinarily weak” result in 2022. How far can Nortura’s ideals of cooperation, solidarity and “obligation to receive” be stretched before the natural laws of business economics catch up with them? Photo: Cornelius Poppe / NTB scanpix – Mykje can come into play – A strong and well-functioning meat and milk cooperative is a cornerstone of Norwegian society, says director of the Norwegian Institute for Bioeconomy, Nils Vagstad. He adds that “further weakening of Nortura could have far-reaching consequences for the districts in Norway and for the Norwegian food security”. – A lot can come into play if Nortura doesn’t get its own house in order. Positive result for Nortura Last Friday, Nortura reported that they are improving the result by NOK 200 million. The explanation is “operational improvements in production, renegotiation of a number of agreements and targeted and short-term cost cuts”. CEO Anne Marit Panengstuen says the company has taken “necessary measures to ensure future growth and profitability”. – In the competition against industry players in livestock-dense areas, we must take steps to adapt the business model to the changes and a lower cost level. We are well underway with the development of a new group strategy that will deliver profitability to our owners throughout the country. “Why are we so stubborn about setting up a slaughterhouse? Yes, for the simple reason that we want safe disposal and the highest prices for our slaughter”, said Lars Opsahl when the first forerunner of Nortura (Hamar Slagteri AS) was established in 1904. 119 years later, Nortura struggles with the same tension. Photo: Nortura With reference to “changing commercial and agricultural political framework conditions”, the group board of Nortura has announced that a working group will assess how the cooperative should adapt to a new era. The report to the working group must be ready “well in time” before the annual meeting in April 2024. – These are demanding times in agriculture, and Nortura is particularly important for Norwegian farmers and the market for meat and eggs in particular, says leader of the Farmers’ Association, Bjørn Gimming. – We take note of Trine Vaag’s departure and look forward to good cooperation with the new chairman, says the leader of the Farmers’ Association. Photo: Camilla Alexandra Lie / news – Listening to the criticism from the departed chairman – The road ahead for Nortura will be tough, says Anders Felde, former leader of Vestland Bondelag. He hopes the co-operative prioritizes putting in place an efficient industrial structure for the slaughtering and further processing of meat and eggs. Even if it goes beyond other good purposes. – This means that district workplaces and other important objectives must be toned down. If the farmer is to have power in the value chain for food, it is absolutely decisive that we own parts of the industry. Following the no-confidence motion against the Nortura boss, the representatives of the company’s annual meeting demanded an extraordinary annual meeting because of “many unresolved questions”. A few days later they changed their mind and withdrew the claim. In a letter The Nation has obtained, they give the basis for the turnaround by stating that several annual meetings will not “provide the opportunity for a thorough debate about why the chairman left”. In return, the same delegates to the annual meeting write that they are looking forward to the control committee’s report on the departure. This is expected to be ready later this autumn. In a press release dated 29 August, CEO Anne Marit Panengstuen writes that she was surprised by the no-confidence motion and that she “listens to the criticism from the now-departed chairman”. – The Norwegian farmer and Nortura are in a demanding time, and it is important that we find good solutions together, says Nortura manager Anne Marit Panengstuen. – We must maintain a profitable farmer-owned industry with expensive food and emergency production throughout Norway, while at the same time we must measure our strength against capital-strong competitors, says strategy director at Nortura Kjell S. Rakkenes. – Should the farmer remain with power in the value chain for food, it is absolutely decisive that we own parts of the industry, says Anders Felde. – Landbrukssamvirka is decisive for food preparedness Gaute Lenvik. managing director i Norsk Landbrukssamvirke – The aim of the Norwegian Landbrukssamvirke is to contribute to the owners, i.e. the farmers, getting good financial results from their production on the farms. They jointly own the co-operatives in order to have security for sales from their own production, and to have this processed and distributed in the market. This security of price and supply is very important in order to maintain the level of production in Norwegian agriculture, which can only be practiced on 3 percent of the total area in Norway. However, it is also decisive for food security. The agricultural cooperative can also be seen as a collective insurance to avoid that each individual farmer has to stand for himself and have to negotiate with an investor-owned industry that largely wants the possible low price for raw materials, and to take over the management of production on the farms. The food sectors are exposed to national and international competition, and it is crucial that agricultural cooperatives, in the same way as their competitors, can continuously work to reduce costs and build strong brands. As the situation is in the market, it is not possible to impose tasks on agricultural cooperatives beyond the commercial ones without being directly compensated for this.
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That is why there is a ruckus in the farmers’ own cooperative – news Vestland
