Rural round-up

August 28, 2014

Fonterra to offer at least 20% premium for Beingmate shares in deal to drive Anmum sales - Jonathan Underhill:

 (BusinessDesk) – Fonterra Cooperative Group will offer a premium of at least 20 percent for a one-fifth stake in Beingmate Baby & Child Food as part of a $615 million investment in a partnership to drive baby food sales into China.

Fonterra will offer 18 yuan a share for Beingmate stock in a partial tender offer that will be supported by chairman Wang Zhentai, who will sell down his stake to about 33 percent in the transaction.

Based on Reuters data, Beingmate has 1.02 billion shares on issue, suggesting the offer values the Chinese company at 18,360 billion yuan and Fonterra would pay 3.67 billion yuan, or NZ$714 million to build a 20 percent stake. The shares last traded at 14.36 yuan before being halted from trading, according to Reuters data. . . .

New Zealand And International Investment Welcomed by Farmers:

Fonterra Shareholders’ Council Chairman, Ian Brown said today’s announced investments in New Zealand’s milk pools and a global partnership with China’s Beingmate were bold moves that would be welcomed by the Co-operative’s Farmers.

Mr Brown: “There is a direct link between the $555 million investment in the Lichfield and Edendale sites and the $615 million investment in the partnership with Beingmate in that both align with the Fonterra strategy of increasing the volume and value of our milk.

“The investment in New Zealand operations is a real positive and will optimise the Milk Price we receive by enabling our Co-op greater flexibility in deciding which products our milk goes into and when. . . .

 Fonterra news ‘as far from milk & disaster as the moon’:

Farmers will be breathing a huge sigh of relief with Fonterra’s benchmark forecast payout for 2014/15 being held at $6 per kilogram of Milk Solids (kg/MS), while other aspects of the announcement are a great boost of confidence in New Zealand agribusiness.

“This is as far from milk and disaster as the moon is,” says Andrew Hoggard, Federated Farmers Dairy chairperson.

“While this season remains a super trim one last season was definitely a silver top one.

“The milk price hold is good news given there’s been widespread speculation about it sliding below the $6 mark, however, we’re not out of the woods yet. We still advise farmers to err on the side of caution by budgeting in the mid-$5 payout range. . .

Major boost for Otago conservation projects:

Associate Conservation Minister Nicky Wagner today announced $475,000 in funding for four Otago conservation projects.

Community Conservation Partnership Fund grants will be made to the Orokonui Ecosanctuary, Landscape Connections Trust, Otago Peninsula Biodiversity Group, and Herbert Heritage Group.

“The projects these groups are advancing align perfectly with the Department of Conservation’s goals of connecting more urban dwellers to conservation and working in partnership with others.

“The Orokonui Ecosanctuary is recognised as the flagship biodiversity project in the South Island and is achieving its aim of restoring the coastal ecosystem to pre-human state. . .

The long arm of health and safety gets longer – Andrew McGiven:

We’ve all heard about the Marlborough farmworker copping $15,000 worth of fines related to a quad bike.  Helmet use is in the Department of Labour’s (now Worksafe NZ) ‘Guidelines for the safe use of quad bikes.’  . 

While there’s been plenty of discussion about the fine what has slipped under the radar are other recommendations in the guide.  One is recognising dangerous areas on-farm and establishing ‘no-go’ zones in your health and safety plans. 

Another case, highlighted for us by Neil Beadle, a Partner at Federated Farmers’ legal advisors DLA Phillips Fox, rams home the bite of these recommended ‘no-go’ zones.  It involved a Mangakino sharemilker with an otherwise good record who tragically lost a farm worker when their quad bike flipped.  . . .

Beet crop ‘revolution for beef farmers’:

The growth in the use of fodder beet as a forage crop in the beef industry has been so rapid, that seed supplies for the coming growing season are expected to run out.

That is the prediction from Dr Jim Gibbs, a senior lecturer in livestock health and production at Lincoln University, who has done years of research on feeding cattle on what has become a revolutionary crop in this country.

Fodder beet is a bulb crop related to beetroot but can grow to huge sizes.

Dr Gibbs’ work was initially for the dairy industry, but the demand for fodder beet really exploded when he introduced it to the beef industry, and he says it has become the fastest growing forage crop by a long shot. . . .


Rural round-up

August 27, 2014

$150 million boost for Rural Broadband Initiative:

National’s Communications and Information Technology spokeswoman, Amy Adams, today announced a re-elected National-led Government will establish a new $150 million fund to extend the Rural Broadband Initiative (RBI).

Ms Adams made the announcement in Greymouth with Prime Minister and National Party Leader John Key.

“The RBI is making an immense difference to the way our rural firms do business, the way our kids learn and the way our health services deliver to us as patients,” Ms Adams says.

“Already, nearly 250,000 households and businesses have access to faster broadband under the RBI. However, National wants to see more rural homes and businesses benefit from faster, more reliable internet. . .

New partnership a boost for sheep and beef farming:

Lincoln University officially launched its lower-North Island base for vocational training and demonstration in lamb and beef finishing systems at a function in the Rangitikei today.

The University, along with the newly-formed Lincoln-Westoe Trust, will operate the 400 hectare Westoe Farm north of Bulls as a training facility, offering land-based certificate programmes for students looking to enter into primary sector careers. The training will have a particular emphasis on sheep and beef farming, and a special focus on training youth from Te Rūnanga o Ngāti Apa.

Over time, the Westoe Farm will also be developed as a demonstration farm for the finishing of lambs and the raising and finishing of beef cattle. This demonstration activity will be underpinned by objective scientific measurement of the farm’s performance, including its environmental footprint. Demonstration activity will be supported by commercial sponsors. . . .

A1 beta-casein a threat to dairy industry – Keith Woodford:

Evidence that A1 beta-casein might be a human health issue has been available for more than 15 years. However, the mainstream dairy industry has always fought against the notion that it might be important.

Back in 2007, I wrote a book called ‘Devil in the Milk’ which brought together the evidence at that time. The mainstream industry and even some elements within the Government were not impressed. They made it clear that this was an issue which New Zealand did not need to air publicly. The industry, with considerable help from the Food Safety Authority, was largely successful in dousing the public concerns, leaving just a few little puffs of smoke to remind those who were watching carefully that the fire might not be totally out. . . .

Landcorp, keen user of Fonterra’s guaranteed milk price, looks to reduce dairy exposure – Jonathan Underhill:

(BusinessDesk) – Landcorp, New Zealand’s biggest corporate farmer, has been an enthusiastic participant in Fonterra Cooperative Group’s guaranteed milk price scheme as it reduces exposure to volatile dairy prices, while looking at ways to reduce the dominance of dairy in its portfolio.

The state-owned farmer’s milk revenue soared 70 percent to $129 million in the year ended June 30, contributing to a more-than doubling of operating profit to $30 million. It won’t see a similar benefit from dairy prices in the current year, given dairy prices have tumbled this year from their highs in February.

“We’re making sure we don’t get too reliant on dairy income so the more volatile dairy sector doesn’t become too dominant in the portfolio,” chief executive Steven Carden told BusinessDesk. Landcorp’s strategy includes exploring fixed-price contracts, hedging and greater cooperation with customers across both dairy and meat, he said. . . .

Country of origin law rejected – report:

The Meat Industry Association is supporting the finding by a World Trade Organisation disputes panel that has ruled against the United States over a country of origin meat labelling law.

Canada and Mexico, backed by New Zealand and Australia, amongst others, opposed a new US rule that requires more information on labels about the origins of beef, pork and other meats.

They regard the country of origin law as a potential trade restriction. . . .

Conservation grant supports bird recovery:

Conservation Minister Dr Nick Smith today announced Wildbase Recovery Community Trust is to receive a $90,000 grant from the Department of Conservation to put towards a new state-of-the-art rehabilitation facility for birds and wildlife.

“New Zealand’s most challenging conservation issue is the decline in our native bird populations. We need to raise public awareness of the threat from pests like rats, stoats and possums that kill 25 million native birds each year. We need facilities like Wildbase Recovery to improve public understanding of our special birds and save those birds that are injured and can be rehabilitated back into the wild,” Dr Smith says.

Wildbase Recovery Community Trust is a charitable trust formed in partnership with local iwi, Palmerston North City Council, Massey University, Rotary and the Department of Conservation for the sole purpose of building, operating and maintaining the community-funded Wildbase Recovery. . .

Benefits from dairy demonstration farm New Zealand wide:

 A new demonstration dairy farm in the Waikato has a key role in helping New Zealand achieve the Government’s target of doubling revenue from primary industries by 2025.

This was a consistent theme from speakers at the launch of the St Peter’s – Lincoln University Dairy Demonstration farm in Cambridge on Thursday 14 August. 

The Demonstration Dairy Farm has set its sights on being in the top 3% of farms in the region for both profitability and environmental performance.  The overall aim of the farm is to promote the sustainable development of profitable dairying, principally in the Waikato but also the greater North Island.  This will be achieved through the implementation of proven scientific research, best practice farming coupled with scientific monitoring of impacts in a collaborative environment with farmers. . .

Akarua Purchases Vineyards on Felton Road

Akarua is delighted to announce a major vineyard purchase with the acquisition of vineyards located in Felton Road and Lowburn finalised on Friday 22 August 2014.

Akarua, established in 1996 by Sir Clifford Skeggs is the largest family owned vineyard in Central Otago with single estate holdings in Cairnmuir Road Bannockburn, this recent purchase will significantly boost their total vineyard area to 100 hectares in Central Otago.

David Skeggs, Managing Director of the Skeggs Group said that that the company had been actively looking at purchasing developed vineyard in Central Otago for the last 2 years. . . .

New Zealand organic pioneers place farming unit up for sale:

A sizeable landholding which is part of one of New Zealand’s oldest organic farming operations has been placed on the market for sale.

The farms just north of Tolaga Bay on the East Coast and trading under the brand Kiwi Organics, have been run by the Parker family for more than 50 years – the last 23 of those under ‘certified organic’ branding. Owners Mike and Bridget Parker are former winners of the Heinz Watties Organic Farmer of the Year title.

Kiwi Organics farm and manufacture primary products for customers throughout the Pacific Rim – including Hong Kong, Taiwan, South Korea, Japan, Australia. The company’s products are Bio Gro Certified, USDA/NOP Certified, and EU Certified and Gluten Free. . .

 


Fonterra expands in NZ and proposes partnership in China

August 27, 2014

A newsletter to suppliers from Fonterra chair John Wilson announces plans to expand processing in New Zealand and the proposal for a new partnership in China:

Your Board has given approval to build a new high efficiency milk powder drier in the North Island and further increase milk processing capacity in the South Island to help meet global demand for dairy products.

This investment, totalling $555 million, will grow the Co-operative’s processing capability and allow for more flexibility to better optimise production.

New Zealand is our most important milk pool.  Our strategy is to increase earnings by driving more of your milk into higher value categories.  It’s all about turning the wheel from commodities to higher-margin products.

Key points on the new Lichfield drier:

  • Capable of processing up to 4.4. million litres per day
  • Similar in size to the world’s largest drier at Darfield which produces up to 30 metric tonnes of Whole Milk Powder per hour, and 700 metric tonnes per day
  • Will use the latest energy-efficient processing and water reuse technology.

Three plants will also be installed at our Edendale site in Southland.  Key points are:

  • Milk Protein Concentrate (MPC) plant which separates protein from skim milk and turns it into protein powder – capable of processing 1.1 million litres per day
  • Reverse Osmosis (RO) plant which will increase capacity on an existing drier by 300,000 litres per day
  • Anhydrous Milk Fat (AMF) plant capable of processing 550,000 litres of milk into cream per day

In total, the development of Edendale will increase capacity by 1.4 million in milk, and 550,000 litres of cream processing per day.

Global Partnership with Beingmate

We are establishing a global partnership with Beingmate, which is one of the leading infant food manufacturers in China.  Beingmate is already a long-standing customer – and is a well-established and respected company in China.

Our partnership will be the next milestone for our strategy, as it will increase the volume and value of our ingredients and branded infant products exported to China.

Together we will create a fully integrated global supply chain from the farm gate direct to China’s consumers, using Fonterra’s milk pools and manufacturing sites in New Zealand, Australia, and Europe.

This global supply chain will see more of our high quality dairy ingredients and our Anmum™ brand exported from here in New Zealand. It will see more high value paediatric products made in Australia for China at the Darnum plant – that is our second milk pool. And it includes a third milk pool in Europe where whey specialty ingredients will be manufactured at our new JV plant in the Netherlands, and through our alliance with Dairy Crest in the UK.

This partnership is about volume and value.  The value will come from accessing Beingmate’s extensive distribution and sales network in the infant formula market in China.  This market is today worth around NZ$18 billion – and is expected to be worth nearly NZ$33 billion by 2017.

This partnership will come together in two phases:

We are starting the process to issue a partial tender offer to gain up to a 20 per cent stake in Beingmate. Depending on the response to the tender offer, Fonterra’s total investment in the global partnership will be in the range of NZ$615 million (including proceeds from the JV in Australia), funded through debt.  

After gaining regulatory approvals and Fonterra satisfactorily completing the partial tender offer, Fonterra and Beingmate will set up a joint venture to purchase Fonterra’s Darnum plant in Australia and establish a distribution agreement to sell Fonterra’s Anmum brand in China.

The purpose of the proposed joint venture will be to manufacture nutritional powders, including infant formula and growing up milk powder at Darnum, for Beingmate as well as Fonterra.

Beingmate will own 51 per cent of the JV to satisfy Chinese regulatory requirements.

The JV will be governed by a Board, and Fonterra and Beingmate will each appoint two directors. 

We will manage Darnum’s operations, under a formal management agreement.  We will also supply raw milk to Darnum.

Summary

Today’s announcements are a major step forward in our strategy to be a globally relevant co-operative so that we can will deliver increased returns to our farmers – through both the Milk Price and dividend – during the ups and downs of global dairy price volatility.  We are financing the increases to processing capacity and our partnership with Beingmate from a solid balance sheet position, and a strong gearing position will be maintained.  These investments are intended strengthen returns by:

  • Turning more New Zealand milk into higher value products  
  • Optimising the use of our Co-operative’s global assets  
  • Investing in capacity and flexibility of our New Zealand assets  
  • Building a fully integrated global supply chain. . . .

This is very good news for the company and the communities where it is expanding processing because of the jobs that will be created.

The board also decided to hold the forecast farmgate payout at $6 a kilo.

Along with a previously announced estimated dividend range of 20-25 cents per share, the forecast Cash Payout for the season is $6.20-$6.25.

The decision to maintain the forecast Farmgate Milk Price reflects the longer term outlook for international prices for dairy. Current market views supported by our own forecasting indicate commodity prices improving later this year or in early 2015, with global demand for dairy continuing to grow year-on-year. 

While the long-term market fundamentals remain sound, we need to recognise that the current conditions are difficult and there remains further downside risk.

There is still volatility. This reflects challenges with supply and demand following a good dairy season globally. Given these factors, the forecast is our best judgement at this time.

It is early in the season, and it is important to continue exercising caution with your farming business budgets. The reality is, we expect to see ongoing volatility, and we will keep you informed as we move forward.

Russia’s decision to block European imports and cheaper grain prices which are leading to an increase in production in the USA will both have an impact on the supply of milk and other dairy products.

Fonterra and its suppliers are right to be cautious.

For more see media releases:

FONTERRA INCREASES PROCESSING CAPACITY TO HELP MEET GLOBAL DEMAND

FONTERRA AND BEINGMATE INITIATE GLOBAL PARTNERSHIP IN CHINA’S HIGH-VALUE INFANT FORMULA MARKET

FONTERRA MAINTAINS FORECAST FARMGATE MILK PRICE FOR 2014/15 SEASON


Rural round-up

August 23, 2014

Speed milking becomes a sport – Jackie Harrigan:

The northern European rural sport of speed milking will be starring at the inaugural New Zealand Rural Games in Queenstown in February.

Games sponsor and Fonterra chief executive Theo Speirings is right behind it.

Having seen the sport known as dairy hand milking in action in his home continent, Speirings said it will be great to see it in NZ.

Rural Games organiser Steve Hollander says the speed milking competition will introduce a dairy component to fit well alongside speed shearing, speed gold panning and coal shovelling. . .

Australian, China-backed company targets NZ forest owners – Paul McBeth

 (BusinessDesk) – United Forestry Group, backed by Australian timber marketer Pentarch and China’s Xiangyu Group, is targeting small forest owners in New Zealand in a bid to cash in on a looming ‘wall of wood’ it estimates will generate $30 billion over the next two decades.

The Wellington-based company wants to consolidate the country’s 14,000 small forests, which account for just over a third of New Zealand’s plantations, and use its forestry management skills and supply chain to achieve a more efficient network and boost returns for the owners, it said in a statement.

United Forestry, which counts Pentarch and Xiangyu joint venture Superpen as cornerstone investors, is offering to buy small forests outright, or buy a combination of land and trees. It will also offer advice on harvesting and marketing mature forests. . .

Varroa and bee viruses linked – study:

An Otago University study has thrown more light on the role that the varroa honey bee mite plays in spreading diseases through beehives.

A PhD student, Fanny Mondet from the University’s Zoology Department and Avignon University in France, investigated the effect of the varroa parasite as it spread south after its arrival in New Zealand more than 10 years ago.

Otago University zoology professor Alison Mercer said the study had confirmed the link between varroa and the spread of some bee viruses, including the deformed wing virus which has been associated with colony collapses. . .

Hill Laboratories appoints new Agricultural Divisional Manager:

New Zealand’s leading analytical testing laboratory, Hill Laboratories, has appointed Dr Bart Challis as new Agricultural Divisional Manager for the company.

Dr Challis brings to Hill Laboratories 16 years of international experience in the fields of Life Science and Biotechnology.

After completing a PhD in microbiology from the University of Otago, Dr Challis began his career in Sales in the United Kingdom in 1999. . .

Funding boost for tutsan fight – Bryan Gibson:

Taumarunui’s Tutsan Action Group (TAG) hopes new funding will help find a biological control for the invasive plant tutsan (Hypericum androsaemum).

Chairman Graham Wheeler said the group has secured a further three years of government and community funding to complete its investigation.

Tutsan now costs some landowners up to $400 a hectare a year to control.

An economic assessment found there is $2.3 million a year in direct and indirect costs, with a capital cost to New Zealand of up to $32m because of the reduction in land values. . .

Pineland Farms: Magic Happens When Private Funding Meets Family Farming – Food Tank:

Pineland Farms, located in New Gloucester, Maine, is a 2,020-hectare working farm, as well as an educational and recreational campus. Pineland Farms comprises three for-profit companies that are supplied by local family farms: Pineland Farms Creamery; Pineland Farms Potatoes; and Pineland Farms Natural Meats. Owned by the Libra Foundation (a Maine-based private charitable foundation), Pineland profits are reinvested in the companies, as well as in other charities that support local communities.

Food Tank spoke with Erik Hayward, Vice President of the Libra Foundation; Rodney McCrum, President and Chief Operating Officer of Pineland Farms Potatoes; and, William Haggett, President of Pineland Farms Natural Meats.

Food Tank (FT): What inspired the creation of Pineland Farms and how is its structure different from smaller family farming operations?

Erik Hayward (EH): In early 2000, a state property came up for sale in New Gloucester, Maine. Built in 1908, it was originally a hospital for the mentally disabled. There were a number of farms on the campus, however these had basically been abandoned and were in various states of disrepair. . .

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Rural round-up

August 17, 2014

Aerial topdressing scheme flies away with top award  – Sue O’Dowd:

A safety programme developed by the agricultural aviation industry to protect the environment has won a major award.

The New Zealand Agricultural Aviation Association (NZAAA) Aircare programme received the Richard Pearse Trophy for Innovative Excellence in the New Zealand Aviation Industry, named in honour of the New Zealand pioneer aviator and inventor, at last month’s Aviation New Zealand conference.

Aircare was an integrated environmental safety and flight safety programme that stopped contamination of waterways by fertilisers and sprays, NZAAA chairman Alan Beck, of Eltham, said. . .

Northlander takers Young Grower crown -

Northland kiwifruit and avocado specialist Patrick Malley was crowned Young Grower of the Year at an awards function in Christchurch last night.

The 30-year-old contracting manager from Onyx Capital kiwifruit and avocado orchard in Maungatapere, Northland, secured his place at the national competition after being named the Bay of Plenty Young Fruit Grower in June.

In the final phase of the competition he topped three other regional champions in a series of practical and theory challenges testing their industry knowledge and skills. . .

Ngai Tahu appeals dairying decision:

South Island iwi Ngai Tahu is appealing against a decision declining an application to develop large scale dairy farms in North Canterbury.

In July this year, commissioners on behalf of the Canterbury Regional Council granted only partial consent to convert 7000 hectares of Hurunui forest to irrigated dairy farming and another 617 hectares for dryland dairy farming.

The decision was based on the unacceptable adverse effects the full development would have on the environment and the water quality of the Hurunui River. . .

Cow lameness costs farmers – Tim Cronshaw:

Cow lameness could be higher than 10 per cent a year nationally and cost dairy farmers an average of $500 for each case of a cow out of production.

Accurate figures are not kept for lame cows because not every incident is reported, there can be repeat cases for the same cow and the extent of lameness can vary.

DairyNZ animal husbandry extension specialist Anna Irwin said lameness was more difficult to measure than mastitis or other animal health issues because it was not routinely measured by all farmers, had different treatments and few cows needed medical treatment. “We have industry estimates of somewhere around 10 per cent and it could be as high as 15 per cent and that’s incidents for the whole year.” . . .

Call for whitebait sock net ban:

Whitebaiters in Buller on the West Coast are demanding an end to the use of large sock nets to catch the delicacy in their area.

Lynley Roberts said she’s collected close to 400 signatures on a petition calling on the Department of Conservation to ban sock nets.

Whitebaiters in Buller on the West Coast are demanding an end to the use of large sock nets to catch the delicacy in their area.

Photo: PHOTO NZ

She said the use of the nets, which she says can catch up to 200 pounds a tide, is greedy.

Ms Roberts said there won’t be time to make any changes before the season starts in Buller on 1 September. . .

Where have all the whitebait gone?:

Whitebait season opened today and many whitebaiters may be asking themselves, “where have all the whitebait gone?” With predictions that it will be only an average season, it’s a very pertinent question.

Whitebaiting has long been a contentious issue, with feuds over the best positions on the river sometimes lasting through generations of whitebaiters.

These days, with whitebait numbers dwindling further and further, the arguments go beyond who has the best spot. Debate now includes the question of where they have all gone, who’s to blame for the declining numbers and if we should still be allowing people to catch whitebait at all. . .

Nominations open today for the 2014 Fonterra Elections:

This year elections are being held for three shareholder-elected Directors for Fonterra’s Board of Directors, two members of the Directors’ Remuneration Committee, and 22 members of the Shareholders’ Council.

Candidates must satisfy shareholding requirements in order to be elected and further procedural requirements are specified in the Election Rules. These include a requirement for Candidates to be nominated and seconded by Fonterra shareholders.

Nomination Papers and Candidate Handbooks are now available by phoning the Election Hotline on freephone 0508 666 446 or emailing elections@electionz.com. Nominations must be received by the Returning Officer, Warwick Lampp of http://electionz.com/ by 12 noon on Friday, 5 September 2014. . . 


Rural round-up

August 16, 2014

 Not celebrating yet - Andrea Fox:

Bay of Plenty farmer David Jensen’s commitment of nearly a third of his milk production this season to Fonterra’s June guaranteed milk price (GMP) of $7 a kilogram of milksolids (MS) looks set to boost his coffers by at least $80,000 but he’s not crowing.

He knows that would be foolhardy, given the roller-coaster ride of the milk price this year and the long stretch of the season ahead.

This is Jensen’s second round on Fonterra’s new fixed milk price programme. In last year’s pilot scheme his business posted a $45,000 opportunity cost after he committed milk at $7/kg MS in what is set to be a record $8-plus payout season. . .

Pipfruit sector’s future ‘very bright’ – Pam Jones:

Good returns are expected in the pipfruit industry this year following a record season last year, Pipfruit New Zealand chief executive officer Alan Pollard says.

Mr Pollard was one of the keynote speakers at the two-day Pipfruit New Zealand conference in Queenstown last week, and visited three Central Otago orchards and one winery with delegates during a field day after the conference.

The conference built on the Pipfruit New Zealand strategic plan, which was released at last year’s conference and outlined how to achieve a goal of developing the pipfruit industry into a $1 billion export industry by 2022, Mr Pollard said. . .

Innovative sheep farmers winners -

Southland and Otago did well in the third annual Beef and Lamb New Zealand Sheep Industry Awards in Napier last week.

AbacusBio managing director Neville Jopson, of Dunedin, received the Focus Genetics sheep industry science award in recognition of his work in the industry, while Mount Linton Station, in Southland, won the Alliance Group terminal sire award for lamb growth and meat yield and the SIL-ACE award for terminal sire for lamb growth.

Andy Ramsden, of Wanaka, was awarded the Allflex sheep industry innovation award for his input to increasing the productivity of New Zealand sheep during the past 20 years, and Riverton’s Blackdale Coopworth stud won the Telford dual purpose award for reproduction, lamb growth plus adult size and wool production. . .

Agricultural drones taking off on farms:

Robots are not only taking their place in milking sheds or on vineyards and orchards – aerial drones are increasingly being used to extend the reach and view of human farmers.

Unmanned aerial vehicles or aerial robots – known in the military world as drones – are increasingly being used for a range of activities on farms, including checking fences and water systems, and monitoring and even moving stock.

Linda Bulk of the Aeronavics company, said farmers were surprised at how easy they were to use.

“It’s so practical,” she said. “There’s that eye in the sky, what you see from above is so much more informative than when you’re on eye level to start with and it gets into those hard to reach areas that are often a hazard for quad bikes. . . .

Improved Returns See Rise in Cattle Numbers:

Dry conditions in the northern North Island and continued land use change in the South Island saw New Zealand’s sheep numbers decrease 3.2 per cent over the 2013-14 season, while beef cattle numbers increased 1.6 per cent.

Beef + Lamb New Zealand’s (B+LNZ) Economic Service carries out a stock number survey annually. Its latest survey shows sheep numbers dropped to 29.8 million in the year to 30 June 2014.

B+LNZ Economic Service Chief Economist Andrew Burtt says strong mutton prices, driven by rising demand from North Asia, encouraged a high level of cull ewe processing for the second year in a row.

Breeding ewe numbers, at 19.96 million, were slightly down (-1.4%) on the previous June. The largest contributor to the overall decline was the South Island, reflecting the continued land use trend towards dairy and dairy support activities.

 

Meadow Mushrooms Opens Second Stage Of $120 Million Redevelopment:

The second stage of a $120 million redevelopment and expansion project at one of New Zealand’s largest agricultural enterprises will be opened this week.

The $12 million investment into the extension of Meadow Mushrooms’ Christchurch farm will add a further 60 jobs and increase production by 37,000 kilograms of fresh white mushrooms a week.

This project follows the $45 million expansion undertaken by the company on site in 2011 and is the second of three stages to completely reconfigure the company’s infrastructure in New Zealand. A new office administration and headquarters construction project will commence before the end of the year and will be followed by an expansion of the compost facilities and growing shed conversions.

“This development demonstrates Meadow Mushrooms’ confidence in the future market and our commitment to the industry,” said John Barnes, CEO of Meadow Mushrooms. . . .

 

 

 


Rural round-up

August 15, 2014

Commission releases draft report on 2013/14 review of Fonterra’s base milk price calculation:

The Commerce Commission today released its draft report on Fonterra’s base milk price calculation for the 2013/14 dairy season. The base milk price is the price Fonterra pays to farmers for raw milk.

The Commission is required to review Fonterra’s calculation of the base milk price each year as part of the Dairy Industry Restructuring Act’s milk price monitoring regime. The review assesses if Fonterra’s calculation approach provides incentives for it to operate efficiently and provides for contestability in the market for purchasing farmers’ milk.

The scope of the Commission’s review is only to look at the base milk price, not the retail price that consumers pay for processed milk. . . .

 

Fonterra’s farmgate milk price out of step with efficiency – Pattrick Smellie:

 (BusinessDesk) – The Commerce Commission says Fonterra Cooperative Group’s decision to cut the last season’s forecast payout to farmer shareholders by 55 cents per kilogram of milksolids below the result produced by its Farm Gate Milk Price calculation is not consistent with the milk price regime’s intention to make Fonterra operate efficiently.

However, it says the decision – the first ever taken to vary the payout from the calculated level since the Farm Gate Milk Price regime came into force in 2009 – was consistent with ensuring competitive provision of milk to alternative suppliers, the commission concluded in its annual review of the regime.

Under the Dairy Industry Restructuring Act, which allowed a merger to create Fonterra despite creating a dominant local market player, the commission must monitor how Fonterra sets the price it pays farmers for milk as part of efforts to ensure it’s possible for local dairy market competitors, such as Synlait or Westland Milk, to emerge.

Under the monitoring and reporting regime, the commission has no ability to force any change on Fonterra. . .

 

Latest dairy farm visits reveal poor record keeping:

The Ministry of Business, Innovation and Employment’s Labour Inspectorate has released the results of the third phase of its national dairy strategy, which involved visits to farms that employ migrant workers.

The findings show that while no exploitative conduct was found, a quarter of the farms visited were in breach of employment laws for poor record keeping.

Senior Labour Inspector Kris Metcalf says the visits were part of a long-term operation to check compliance with minimum employment obligations at dairy farms across the country.

“The majority of the 42 dairy farms visited in this phase were meeting minimum employment standards,” says Kris Metcalf.

“However, 11 farms were found to be in breach of their minimum employment obligations which is disappointing. . .

Government migrant dairy worker survey highlights procedure hole:

Following the third phase of the Ministry of Business Innovation and Employment’s (MBIE) dairy strategy, focussed on migrant workers, Federated Farmers knows a sizable minority of farmers still need to meet basic employment law and the Federation is offering to help.

“The latest information from MBIE shows that there has been a significant improvement in the performance of dairy farmers, but far too many are failing to take accurate time sheets seriously enough,” says Andrew Hoggard, Federated Farmers Employment Spokesperson.

“We are pleased MBIE inspectors did not find any exploitative behaviour of migrant workers on the 42 farms they visited. That said we’ve still got a bit of work to do with our guys on record keeping and basic employment practices. . . .

Softening the dairy blow:

• NZ dollar is under pressure
• Interest rate predictions delayed
• Meat sector outlook remains bullish

While eleven of the last twelve dairy auctions have recorded price falls, the sheer magnitude of the falls is bringing other factors in to play, according to the latest ASB Farmshed Economics Report.

“With dairy prices down by 37 percent on a year ago, the NZD has finally come under some pressure” says Nathan Penny, ASB Rural Economist.

“The NZD has passed its peak. We expect the NZD to trade at around 85 US cents for the rest of the year.”

“The dairy price falls are also a major reason why we’ve pushed back our interest rate call.” ASB Economics now expects the next OCR increase in March 2014 rather than their previous call for a December 2014 hike. . .

 

Working group for dairy processing sector:

Primary Industries Minister Nathan Guy has announced the establishment of a working group to develop a ‘roadmap’ on how to meet the future capability needs of the dairy processing sector.

“This was a recommendation of the independent Government Inquiry into the Whey Protein Concentrate (WPC) Contamination Incident last year. It found that our food safety regulatory model for dairy is among the best in the world, but also recommended improving people capability to strengthen the food safety system.

“The inquiry highlighted the shortage of experienced people with processing expertise across the industry’s regulatory sector, and at all levels of the system. . .

 Does Australia want to compete? – Jo Bills :

Recently the Business Council of Australia released a report it commissioned from McKinsey & Co – Compete to Prosper: Improving Australia’s global competitiveness.

It was fascinating reading – taking a helicopter view of the Australian economy and the global competitiveness of industry sectors.

Most of us probably regard Australia as a trading nation, but the McKinsey analysis highlights the fact that our economy remains quite inwardly focussed – while we are the world’s 12th largest economy, we rank 21st in terms of global trade – well behind some that you might assume we should be ahead of.

As part of the study, the McKinsey number-crunchers developed a Relative Competitiveness Score, applied it to all sectors of the Australian economy and found that only one sector – agriculture – stood out as truly competitive. . .

Boost for wilding tree control in Waimakariri:

A group of volunteers dedicated to clearing wilding trees around Flock Hill in upper Waimakariri is to receive a major funding boost, Associate Conservation Minister Nicky Wagner announced today.

Waimakariri Ecological and Landscape Restoration Alliance will receive $309,000 over the next three years from the Department of Conservation’s Community Conservation Partnership Fund.

“Wilding trees are now the most significant threat to biodiversity and infrastructure in the 60,000 hectares of public and privately owned lands in the upper Waimakariri Basin. . .

Forest contractors welcome WorkSafe submission:

Today the government’s safety agency for forestry, WorkSafe NZ, has publicly released its submission to the panel of the Independent Forest Safety Review. The Forest Industry Contractors Association (FICA), the industry group that originally initiated the review, has welcomed the comments from the regulator.

“We’re pleased that some vital issues have been highlighted by Gordon MacDonald’s WorkSafe NZ team,” says spokesman John Stulen of the Forest Industry Contractors Association, “They’ve made some very practical observations vital to making change in our industry.”

Stulen says WorkSafe NZ has been open and frank in their criticism of some shortcomings, yet has also been constructive at the same time. . .

Feed Partnership Set to Shake Up South Island Mag Regime:

South Island dairy farmers can now reap the rewards of a revolutionary new Magnesium product, which is transforming Magnesium use in dairying.

Animal feed ingredient supplier, BEC Feed Solutions, is partnering with South Island animal feed manufacturer and blender, James & Son (NZ) Pty Ltd, to give the region’s dairy farmers convenient access to its Bolifor® MGP+ product.

Bolifor® MGP+ is a unique alternative to messy pasture dusting and laborious daily drenching, and contains the essential minerals Magnesium and Phosphorus in the one product. It’s anticipated thatBolifor® MGP+ will be well received in the South Island, given that farmers, vets and animal nutritionists are observing an increase in Phosphorus deficiency due to the region’s dependency on fodder beet crops and changing land use. . .


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