Danone ruling will hit farmers in the pocket - Federated Farmers

Federated Farmers is frustrated with people slamming Fonterra over its $183 million fine.

It will pay French food giant Danone for recalling products as a precautionary measure in 2013.

Danone sued Fonterra over the whey protein concentrate contamination scandal, when Fonterra quarantined several batches over fears it was contaminated with clostridium bacteria. It later turned out to be a false alarm.

Federated Farmers vice president Andrew Hoggard says people think Fonterra is a private company, but it is owned by the country's dairy farmers.

"There's a bunch of people that need to get it into their heads this is a New Zealand-owned company. The profits it makes goes back into New Zealand, they go into our regions. Fonterra does well and New Zealand does well, and I wish people would have a bit more respect for it, to be honest."

Mr Hoggard says dairy farmers will lose around $16,000 each as Fonterra cuts dividends to cough up the money.

"It's going to hit farmers. It's going to cost all of us. A few farmers won't be particularly happy about that, but it is what it is."

Mr Hoggard says Fonterra did the right thing by owning up, even though the scare turned out to be a false alarm.

"In hindsight, they could have said nothing and got completely away with it. That was the wrong thing to do - they did the right thing… But mistakes were made and we've learnt from it."

Danone said it "welcomes" the court ruling.