1.How would the public, which doesn’t like coprorate farming, react to the suggestion a private company that already owned 105 farms wanted to buy the 16 Crafar farms?
2. Would it make a difference if a company which didn’t already own farms but was foreign owned wanted to make a bid?
3. Would it make a difference if the company wanting to bid was Landcorp, an SOE?
4. If Landcorp buys the 16 Crafar farms should it sell some of the 105 farms it already owns?
5. How much land should Landcorp have?
6. Is Landcorp a good farmer?
7. Does it have expertise in farm development?
8. If so how does its record of development compare with that of private farmers or companies?
9. Should the taxpayer have $1668.7m tied up in farms?
10. Are dividends of $10m last year, $13m in 2007/08, $12m in 2006/07 and $3m in 2005/06 good returns on that investment?
11. Would there be bigger dividends for New Zealand agriculture – and all New Zealanders – if some or all of the $16668.7m was invested in irrigation, agricultural research and education or training instead?
12. Would New Zealand be better off if some of that money was invested in something other than agriculture – health or general research and education perhaps?
13. Why doesn’t Landcorp invest in processing and fertiliser co-operatives as most other farmers do?
14. Do they support NZ Inc?
15. Should the state be in farming?
16. Why can’t individual New Zealanders or private companies afford to buy the Crafar farms individually or as a group?
17. Can a corporate entity ever be as good at farming as individuals and families?
(A nod to Cactus Kate who’s so very good at asking random impertinent questions.)
Homepaddock 
You get the feeling that Landcorp is a cosy arrangement where the reality of real returns on capital are hidden behind a political wall.
Don’t expect to ever get a straight answer for any of these questions.
How many young farmers have been denied opportunies to own farms privately because Landcorp has driven them out of the market?
As for Crafar’s farms, I suspect that the recievers only have one thing on their mind- the $15m+/- fee.
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Your points are very valid and I agree with them.
In the case of the Crafar farms however there is, IMHO a case to be made in favour of Landcorp possibly buying them.
The receivers have a statuary responsibility to act in the interest of those who wish to recover money owed and secured who called the receivers in.
As a sale of the whole will probably satisfy that need then it is likely all other equity will be extinguished.
As one with a past in the vulture ridden industry that sells property one of the first rules is that to maximise returns, then a reduction of asset value to smaller parts will be time consuming and sometimes complicated but worthwhile to maximise these returns. Therefore an orderly marketing will bring more rewards than selling the whole but will be unattractive to receivers who dont have any interest in a “purchase as a whole and on selling the parts” activity that would have advantages for the realisable value of the Crafar farms, other holders of equity and the market generally.
My argument is predicated on a philosophy that is probably only an idealone and certainly contrary to the mandarins of Landcorp whose primary drivers are empire building and socialising of land tenure coupled with a disconnect as to what effect their actions have on the private sector in farming in particular, and commerce and banking in general.
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Our son left orcharding after 10 years to go shepherding 3 years ago. After a year he applied for a posion on a Landcorp farm near Mangakino and someone told him that once you get with Landcorp you have a `job for life’ and can move from farm to farm at their expense.
He missed the job and is in Central Hawkes Bay with a very good farmer.
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$10m odd off $1 billion….brilliant returns 😉
Landcorp farms would be better off sold on the market to private individuals and companies. Sure it would result in a drop in prices but as Lou has stated, more people would have the chance to buy the farms and build their own long-term businesses with a revenue stream, not just take punts on capital gains – which is all farming has become.
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Lou – you’re right, it would be very hard to compete with Landcorp’s buying power.
GD selling the farms individually would open them up to more sellers and almost certainly result in a better price, but I take your point that the receivers may not be itnerested in that.
PDM – Landcorp does have a good reputation for training staff. No doubt like anyone else once they’ve trained them they want to keep the good ones and that wouldn’t be hard with 105 farms to choose from.
Kate, no point flooding the market by trying to sell the lot at once. But a gradual selling off of farms would be better for farming and the taxpayer than continued state ownership.
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Well as my parents got a ballot farm so I’m a bit of a Landcorp fan. Though I think it’s lost it’s way, once upon a time it was about taking huge “inefficient” farms & investing in breaking them up & making them more productive, then selling them to up & coming farmers ( surely a smart play would be Landcorp becomes a major sponsor of Farmer of the Year, giving farms as prizes, instead of balloting farms, but that’s a whole different arguement ).
I’m not sure what it does now apart from provide a land bank for treaty settlements & chop down forests around Taupo.
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Isn’t Landcorp the lesser of two evils? Now that their bid has failed, consider the following
I believe that this large amount of land should not be sold to non New Zealand interests, regardless of wether there is a reciprocal agreement or not.
There are a number of reasons for this point of view.
1. New Zealand is a nation of producers. We use the land to provide items to trade with the rest of the world, and that land is irreplaceable, when it is nolonger in our ownership we may in future not have the ability to feed ourselves, or to trade with the rest of the world.
2. Our identity is our land. Look at the Maori land rights claims -we are passionate about our land ownership, and we will never be able to in future say we made a mistake and take a land rights claim to foreign owners.
3. Selling land like this is a foreign take over with out the blood shed of war, but the result is the same.
4. What benefit (in the short and long term) do we as a nation get from this sale?
I am passionate about ensuring this sale does not proceed. What is being done to educate the public to stop it?
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Join the save the farms campaign by Lawyer Tony Bouchier its gaining heaps of support.
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I totally agree with Bronwyn’s comments.I believe that Landcorp is the lesser of the two evils.Why on earth would we want to sell large tracts of farmland to overseas interests ? I think a lot of New Zealanders would support this view also.I felt very heartened by the news that a group of New Zealanders had seen fit to form a group to protect local interests.
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Foreign ownership per se isn’t bad, nor is local ownership always best.
But if the farms were sold separately it would be more likely individual New Zealanders would be interested in buying.
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HP, this is a very valid debate. My input and suggestion is that why not consider leasing rather than selling- on long term leases? The British have a good history of leasing and it works. The Duke of Westminster, for example, owns much of Mayfair in London but all the buildings are leased-the British get on with it. Leasing in NZ is tainted and has a bad name because of government ownership of farming property.
When I was a Director of Ngai Tahu’s commercial arm, in the early 2000’s, Directors debated this issue; ownership being very important to Maori,and leasing being an option. But it got no legs because of other political issues that dog NT to this day.
HP, keep this debate open, it is so very important for our country.
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Yes, there is merit in long-term leases but I still wouldn’t want a blanket ban on foreign ownership.
Happy to keep the debate open and will do more posts on the topic.
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