365 days of gratitude

October 10, 2018

Sweet notes of bird song entertained me on this morning’s walk.

I peered up and found the singer – a tui.

Today I’m grateful for nature’s music.


Word of the day

October 10, 2018

Obelus – the † symbol used as a reference mark in printed matter, or to indicate that a person is deceased;  a mark (– or ÷) used in ancient manuscripts to mark a word or passage as spurious, corrupt or doubtful; the division sign in mathematics.


Hunter Downs irrigation scheme down

October 10, 2018
The Hunter Downs irrigation scheme hasn’t got enough support to go ahead.

Hunter Downs Water Ltd announced yesterday it did not have enough buy-in from landowners in its command area between the Waitaki River and Timaru.

The company owns resource consent to use up to 20.5 cumecs of Waitaki River water.

The irrigation proposition was launched in 2006.

In March last year, shares were offered in a $195million scheme to irrigate 21,000 ha and a government development funding grant of $1.37million had been made. By June 2017, the design was shrunk to 12,000 ha.

At the end of last year, South Canterbury rich-lister Gary Rooney’s offer to buy “dry shares” saved the project from being scrapped then.

In April, Finance Minister Grant Robertson announced Crown Irrigation Investments Ltd’s $70million term debt funding would no longer be available to the scheme. So the company released a new funding proposal in August, asking all prospective investors to reconfirm their commitment.

Not enough did.

Chairman Andrew Fraser said yesterday “a significant drop-off in support” meant the scheme could not proceed.

It was not all about intensifying land use and converting to dairying, but rather relieving pressure on existing water takes, decreasing reliance on surface water extractions, and using the plentiful Waitaki River resource, he said. . .

These schemes have to have the support of farmers. But without debt funding from Crown Irrigation, the cost would have been too high for too many. IrrigationNZ rightly calls it a lost opportunity for South Canterbury.

The scheme had the potential to significantly boost the Waimate economy, create jobs, improve people’s standard of living and help resolve water quality problems,” says Andrew Curtis, Chief Executive of IrrigationNZ.

“It’s disappointing that a scheme with wide reaching community benefits won’t proceed.”

“Much of Environment Canterbury’s plans for improving water quality in the South Canterbury coastal area rely on the development of the irrigation scheme to reduce pressure on groundwater and augment the Lake Wainono Lagoon. Hunter Downs still wants to use its consent to augment the Lake Wainono Lagoon, but the other environmental impacts of the scheme not proceeding will need to be worked through.”

The scheme wouldn’t just have drought-proofed farms, it would have    had environmental benefits in improved water quality and lagoon enhancement.

“While farmers benefit from irrigation development, so do local communities. Irrigation projects are difficult to get off the ground if farmers are the sole funders of major infrastructure projects. There have now been numerous studies completed of New Zealand irrigation schemes and all demonstrate that irrigation have significant benefits for local communities and create substantial new tax income for the government,” says Mr Curtis.

“Other countries are increasing their investment in water storage to recognise that their communities and economies need access to a secure water supply in a changing climate. New Zealand needs to keep making similar investments to future-proof our water resources and food production, and secure our export income.”

On the south of the Waitaki River the economic, environmental and social benefits of irrigation are obvious. Those on the other side of the river will miss out on all of that without the scheme.

Rural round-up

October 10, 2018

High lamb prices will hit profit – Nigel Malthus:

Alliance Group has warned that its annual result, due to be reported in November, will show a drop in profit.

“The financial performance of the company this year will be down… meaningfully,” chief executive David Surveyor told farmers attending the company’s roadshow meeting in Cheviot last week.

However, he assured shareholders the company is profitable, the balance sheet remains “incredibly strong, and for the avoidance of any doubt we have the ability to make sure we build our company forward.” . . 

3 M bovis farms confirmed through bulk milk testing – Sally Rae:

 Only three farms have been confirmed through bulk milk testing as having Mycoplasma bovis – but the Ministry for Primary Industries says it is too early to speculate about final results.

The second bulk milk surveillance programme was being undertaken now as spring was the best time to test for the disease, the ministry said.

Infected animals were more likely to shed the bacteria after a stressful period, such as calving and the start of lactation
.

To date, almost 10,000 of the country’s 12,000 dairy farms had completed two rounds of testing, MPI said in an update
.

Govt committed to Mycoplasma bovis eradication; $25.6M spent to date – Rebecca Howard:

(BusinessDesk) – The government has paid $25.6 million in compensation claims related to Mycoplasma bovis and remains committed to phased eradication, said Prime Minister Jacinda Ardern and Biosecurity Minister Damien O’Connor.

One of the biggest challenges for farmers has been navigating the compensation process and Ardern and O’Connor announced a new recovery package aimed at making that easier.

The package includes a team of rural professionals who understand both farming and the compensation process who can sit down and work with farmers on their claims. The Ministry for Primary Industries has also produced an improved compensation form and guide and an online calculator of milk production losses. It will also provide regional recovery managers for key areas. . . .

Marc Rivers: The man with Fonterra’s fortunes in his hands – John Anthony:

Marc Rivers has a TEDx talk. And it’s not about numbers, profit and loss – and there is no mention of balance sheets.

Rivers, Fonterra’s top number cruncher, is not your typical chief financial officer.

Unlike their charismatic chief executive counterparts, chief financial officers are generally regarded as robotic accountant types, capable of presenting a company’s financial position in jargon that few people understand. . . 

State of the Rural Nation Survey finds rural dwellers less likely to talk to health professionals

  • Seven in ten people have felt increased stress over the last five years
  • Those aged 18-39 feeling the most pressure
  • 61 percent said living rurally limits access to mental health resources

A recent survey has found that 70 percent of rural New Zealanders have felt more stress over the last five years.

The State of the Rural Nation Survey, conducted by Bayer New Zealand and Country TV, asked participants several questions regarding their views on critical topics impacting rural New Zealand today, including a series of questions around mental health.

Of those who responded that they had felt increased stress over the last five years, over half (54 percent) attributed financial pressures as the main reason, while the impact of environmental factors (ie droughts, flooding, hail) on people’s work and livelihoods came in at a close second (49 percent). . . 

Gene editing in brief: What, how, why:

Embracing gene editing could have huge benefits for New Zealand’s primary industries and we shouldn’t be scared of the technology, scientists say.

The latest paper in a series from the Royal Society Te Apārangi outlined five ways gene editing could be used in farming and forestry and scientists are keen for Kiwis to discuss the issue.

It sounds scary, though.  So what’s it all about?

Gene editing (also known as genome editing) is the targeted alteration of a specific DNA sequence. While older genetic modification technology typically added foreign DNA to a plant or animal, gene editing involves precise modification of small sections of existing DNA.  . . 

Mental health workshop focus on rural people:

Workshops being held across the country are equipping farmers and rural professionals with the tools to recognise and support those who are struggling.

NZ Young Farmers has organised five of the Good Yarn workshops, the second of which was held in Carterton last week.

Greytown dairy farmer Rachel Gardner, one of 14 attendees last week, is encouraging other young people to talk about mental health. . . 

Meat measurement technology given funding boost :

Adelaide-based AgTech startup MEQ Probe has received $500,000 funding from Meat & Livestock Australia and industry partners Teys Australia and the Midfield Group to test ground-breaking technology to objectively measure the eating quality of meat.

Coming just a few months after MEQ Probe took home a coveted Pitch in the Paddock prize at the tri-annual Beef Australia event, the funding also includes investment from MEQ Probe founder, AgTech betaworks Availer.

It will enable a commercial pilot of the MEQ Probe technology, which uses nanoscale biophotonics to measure the marbling and tenderness of meat; both major drivers of eating quality.   . . 

 

Blueberry orchard for sale offers jam-packed opportunities:

A substantial blueberry orchard with its own commercial processing plant and refrigerated pack-house – producing one of the rarest but highest-yielding blueberry crops in New Zealand – has been placed on the market for sale.

The 8.8-hectare property at Gordonton in the Waikato features some eight hectares of blueberry plantings under canopy cover, along with buildings, equipment, and plant used for picking, sorting, packing and chilling blueberries.

Planted on peat soil and regularly fertilised, the orchard has some 15,000 trees – including 500 of the new Jaac variety of blueberry which produces a heavier-yielding crop than traditional clones. Other blueberry varieties grown in the orchard include Powder Blue, Tiff Blue, Centra Blue, O’Neal, Sunset, and Velluto. . . 


Fonterra drops forecast payout

October 10, 2018

Fonterra has dropped its forecast farmgate milk payout for the current season:

Fonterra Co-operative Group Limited today revised its 2018/19 forecast Farmgate Milk Price from $6.75 per kgMS to a range of $6.25-$6.50 per kgMS and increased its forecast New Zealand milk collection volumes by 1.3 per cent to 1,550 million kgMS.

While no-one will be celebrating this, it’s not unexpected and it’s still not a bad price.

Although it’s very early in the season and it could well change again.

Fonterra Chief Executive, Miles Hurrell, says the change in the forecast Farmgate Milk Price was due to a stronger global milk supply relative to demand at this time.

“I know how hard it is for farmers when the forecast Farmgate Milk Price drops, but it’s important they have the most up to date picture so they can make the best decisions for their farming businesses.

“We are still seeing strong production coming from Europe, US and Argentina. While the hot weather in Europe has slowed down the region’s production growth, it is still tracking ahead of last year. US milk production is up slightly and Argentina’s is up 6.8%.

“Here in New Zealand, the season has got off to a positive start, mainly thanks to good weather and early calving in the South Island. As a result, we have increased our forecast milk collections for the year to 1,550 million kgMS – up from 1,525 million kgMS.”

Mr Hurrell says that global demand is simply not matching current increases in supply.

“At recent Global Dairy Trade (GDT) events, prices for all products that make up the milk price have fallen. Demand for WMP, in particular, continues to grow in China, and it remains strong across South East Asia, but it simply isn’t matching current levels of supply.”

Talking about the new move to provide a range for the forecast Farmgate Milk Price, Mr Hurrell says it was part of the Co-op’s intention to provide the best possible signals.

“We operate in a hugely volatile global market place, so it is very difficult to pinpoint an exact forecast Farmgate Milk Price this early in the season. For example, weather conditions can change suddenly and this can have a significant impact on the global milk supply.

“As a result, we have chosen to give a range of $6.25-$6.50 per kgMS and be clear that the Advance Rate is based on $6.25 per kgMS and the final price could be outside this range as we are still early in the season and up against considerable volatility. We therefore recommend farmers budget with ongoing caution.”

The timing of today’s update is driven by available market information and is not a DIRA requirement. Fonterra is required to give a forecast for DIRA purposes by 15 December 2018.

Supply and demand – the former is higher than the latter which depresses the price.

It’s as simple as that.

 


Who’s fleecing us?

October 10, 2018

Jacinda Ardern reckons fuel companies are fleecing us.

The Motor Trade Association says that isn’t so:

. . . MTA Chief Executive Craig Pomare says the biggest influences on prices at the pump are the landed refined price of petrol and diesel, taxes and the value of the NZ dollar against the USA dollar.

“Competition also has a big effect in New Zealand. It is well recognised that the deregulation of the market and the emergence of Gull, and other smaller independents such as Challenge and G.A.S. have affected prices in the areas where they operate. So too has the widespread use of discounting.”

Mr Pomare says the independent fuel retailers have minimal control over their daily pump prices.

“Most of these small businesses have contracts with the oil companies which give them very little wriggle room when it comes to setting their pump price.

“We take issue with the Prime Minister for suggesting that service stations, or oil companies are ‘fleecing’ motorists. Last year’s review of pricing by MBIE found no evidence of this. Like others in the sector, and the public, we support a further detailed market study to give us all more information on pricing structures.”

He says if the Government is seriously concerned, there is plenty of precedent for reviewing fuel taxes and either lowering them, or holding off on further increases.

Michael Barnett, chair of the Auckland Business Chamber has no doubt where the blame lies:

The tipping point for fuel consumers has been the blunt and ineffective fuel taxes imposed by local and central government. The margins identified by media today are less than most retailers would seek and have not changed.

It is worth noting:

• The major fuel companies welcome the proposed investigation from the Commerce Commission

• Of the 1,500 service stations in New Zealand, over 1200 are mum and dad running their small businesses, employing people and trying to make a profit. They deserve a return on the risk

• There are 20% more fuel providers than 5 years ago – does this signal a lack of competition?

The currency and additional Government taxes have created a price point consumers find unacceptable.

Consumers don’t only find the price unacceptable, Many also find it unaffordable.

The National Party has called for the tax increases to be dropped.

The Government should axe its fuel tax increases to provide immediate relief to motorists, Opposition Leader Simon Bridges says.

“Instead, the Prime Minister’s response to record high fuel prices is to announce yet another inquiry.

“She’s saying consumers are being ‘fleeced’ while her Government is driving up fuel prices and taking hundreds of dollars from Kiwi households through higher taxes on fuel.

“The inquiry will take months and any resulting changes could be years away. Meanwhile New Zealanders are paying record prices for petrol and the Government is collecting hundreds of millions of extra tax from them.

“Unlike petrol, talk is cheap. And the Government is a big part of the reason why petrol prices are so high.

“The importer margin, the profit petrol companies make on every litre of fuel sold and which the Prime Minister wants more information on, is 31 cents per litre and around the same as it was last year. The amount the Government makes is $1.25 – and that keeps increasing.

“The average New Zealand household is now paying $200 a year more in petrol taxes than this time last year, with Auckland families paying $324 extra as a result of higher petrol prices and this Government’s decision to hike fuel taxes. It’s pricing Kiwis out of their cars.

“There are a number of other reasons behind record petrol prices and National supports another look at the practices of fuel companies, something we also looked at in Government, but the Government should also be looking in the mirror.

“While the Government passes new legislation and waits for yet another report it should provide immediate relief to motorists by putting a stop to its relentless imposition of new taxes.”

The Taxpayers’ Union agrees:

Taxpayers’ Union Economicts Joe Ascroft says “When the Government was legislating for fuel tax hikes, we argued that these taxes punish hard-working families – especially those that live in the city-fringe and are forced to commute for work. The Government should back the call from the Opposition and provide much-needed relief to family motorists who are struggling.”

“Now that National has called for fuel tax repeal, it must meet that commitment if it goes back into Government in 2020, 2023, or later. It’s easy to argue for tax cuts in opposition, but walking-the-talk in Government is much harder. The Taxpayers’ Union will be watching closely
.”

Who is fleecing us?

The government that is taking nearly half the price of fuel in tax and worsening the pain by spending the increases not on roads but public transport and cycle ways most of us will never use.


Quote of the day

October 10, 2018

The past is what you remember, imagine you remember, convince yourself you remember, or pretend you remember. Harold Pinter who was born on this day in 1930.


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