Rural round-up

Surviving the dairy downturn – Keith Woodford:

In recent weeks the short term dairy outlook has turned from bad to awful. Fonterra’s recently revised milksolids price estimate of $4.15 for the current 1015/16 season has already been overtaken by events, and is once again looking decidedly optimistic.

I now see a figure of about $3.90 as being more likely, but still with plus or minus 40c around that. Even more important, no longer can we ignore the likelihood that dairy prices are going to stay low for at least the first half of the 2016/17 dairy season, and possibly for all of that season.

Most but not all of the farmers I have contact with are going to come through relatively unscathed. But that is not the case for those who have both high costs of production and high debt. We are now facing a situation which New Zealand farmers have not faced since the 1980s. . . 

Broker warns average dairy farmer may lose $140k this season – Edwin Mitson:

(BusinessDesk) – Financial broker OMF is warning the average New Zealand dairy farmer is likely to lose $140,760 this season, with next year looking just as grim.

In its monthly New Zealand dairy report OMF suggests there is a further risk that Fonterra Cooperative Group could lower payouts again, pointing to a potential milk price of $3.89 per kilogram of milk solids. Fonterra lowered prices on Jan. 28 to $4.15/kgMS. OMF estimates the current cost of production is $5.31/kgMS.

OMF said dairy farmers are likely to face a third season of weak prices, with many becoming increasingly reliant on credit lines and vulnerable to a shift in banks’ willingness to “extend and pretend” loans are going to be repaid. DairyNZ estimates 85 percent of dairy farmers will make a loss this season compared to 49 percent last season. . . 

Seafood exports reach $1.63 billion:

New Zealand seafood exports reached a record high of $1.63 billion last year, up over 6 per cent on 2014.

The growth was most pronounced in the final two months of the year, says Chief Executive Tim Pankhurst.

Up to the end of October export growth was tracking at about 3 per cent but increased demand in November and December pushed the growth to over 20 per cent for those two months and lifted total growth for the year to 6.6 per cent. . . 

Ex-deer farmers drawn back by strong returns:

Deer farmers who left the industry for brighter pastures in dairy are being drawn back by strong returns for venison and velvet, a south Canterbury deer farmer says.

Kris Orange farms 1600 weaner deer on 260 hectares in Geraldine, South Canterbury and 1000 hinds on a farm at Dunback, Otago.

He said venison prices were up more than $1 on last year’s returns, sitting at about $7.20kg, with expectations of strong growth in the next five to 10 years. . . 

Four finalists named for IrrigationNZ’s Innovation Award:

For the second time – IrrigationNZ has shortlisted four finalists for its ‘Innovation in Irrigation Award’ sponsored by Aqualinc – which will be presented at the organisation’s biennial conference in early April.

New technologies, products, practices or community collaborations that reflect innovation within the irrigation sector are the focus of the award, which is only presented every second year.

IrrigationNZ CEO Andrew Curtis says the external judging panel had struggled to keep the shortlist to the normal three, so four finalists have been chosen this year. . . 

Beef + Lamb New Zealand making global connections:

Beef + Lamb New Zealand teamed up with Le Cordon Bleu New Zealand Institute (LCBNZ) recently to host six chefs from China – winners of the global “Chef par Excellence” culinary competition.

The institute and Sealord New Zealand were the main sponsors and Beef + Lamb New Zealand (B+LNZ) was invited to arrange a day’s activity for the chefs.

B+LNZ General Manager Market Development Nick Beeby says the opportunity was too good to pass up, particularly given the group’s influential travel members. . . 

SealesWinslow mills receive quality stamp:

SealesWinslow has attained FeedSafeNZ accreditation across all of its mills, recognising the high quality of the animal feed products they make.

FeedSafeNZ is a quality stamp from the New Zealand Feed Manufacturers Association (NZFMA) for manufacturers and blenders, designed to enhance the quality assurance of stockfeed. . . 

Synlait Strengthens Senior Team to Drive Value Growth And Business Performance:

Three new senior management positions will add business development and process improvement capability to Synlait’s Senior Leadership Team.

Managing Director and CEO John Penno said the decision follows an assessment of business areas that require additional focus to ensure the company continues to deliver against its growth aspirations.

“Building our business development capability will significantly improve our ability to take advantage of emerging opportunities that will accelerate our growth,” said Mr Penno. . . 

 

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