Word of the day

16/12/2021

Ventosity – flatulence or its cause; pompous conceit or boasting; pride; vainglory; inflated vanity.

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Rural round-up

16/12/2021

Record milk price is holding – Sudesh Kissun:

Last week’s rise in global dairy prices has further boosted the chance of a record-breaking $9 milk price for the season.

Whole milk powder prices – the benchmark for Fonterra’s milk price – to its farmer suppliers – broke the US$4,000/metric tonne barrier for the first time in six months.

Westpac has lifted its 2021-22 farmgate milk price by 10c to $9/kgMS, at the top of Fonterra’s updated forecast range of $8.40 to $9.00/kgMS.

Senior agri economist Nathan Penny believes the lower NZ dollar is likely to prove a windfall gain for farmers. . .

Fert prices hurt – Sudesh Kissun:

Federated Farmers vice president Chris Lewis claims farmers won’t be making much money this year, despite a record forecast milk price.

He says fertiliser prices have jumped 100%, wage bills are up 20% and hiring tradesmen has become more expensive.

Lewis says “market forces” mean farmers must pay more to retain staff in a labour-squeezed market.

While the record forecast payout must be celebrated and provides a buffer against rising costs, he doesn’t expect too many farmers to end up with a large surplus this season. . .

SNAs are great if you have the space – Lois Williams:

Telling farmers to protect what they’ve been protecting for a hundred years was never going to go down well on the West Coast.

But having a Significant Natural Area (SNA) or even several on your land need not be an outrageous imposition – if you have scale.

That’s been the experience of one of the region’s biggest landholders, Ken Ferguson, of Waipuna Station.

The Grey Valley spread he farms with his brother Mark has been in the care of Ken’s family since the 1860s and has 60 hectares set aside in significant natural areas. . .

Croptide raises $1m to help fruit growers battle water scarcity :

 Agritech startup Croptide, which transmits plant water health to a farmer’s phone within seconds, has raised $1 million in a pre-seed funding round led by Icehouse Ventures with support from Sir Stephen Tindall’s K1W1 and Masfen Group.

Croptide uses internet-enabled sensors to provide accurate and timely water measurement data to fruit and wine growers battling the impacts of water scarcity brought about by climate change. The sensors are clipped to the plant, sourcing accurate water and nutrient readings directly from its stem tissue, a new, more precise approach to measuring plant health.

The company aims to improve water use efficiency for fruit and wine growers by 30-50%.

Four global businesses are among the first to trial Croptide’s technology, with T&G Global, Pernod Ricard Winemakers, Cloudy Bay New Zealand, and Indevin have signed up for the summer pilots; along with large kiwifruit grower, the Ngai Tukairangi Trust. . .

MPI funding for transition to future orchard planting systems:

A project to increase the successful adoption of a new growing system with the potential to double orchard productivity, improve environmental outcomes, and boost labour efficiency has received $1.65 million of Government funding.

Future Orchard Planting Systems (FOPS) is a scientifically proven fruit tree growing system. It has the potential to double yields and improve fruit quality by bringing orchard rows closer together and growing trees in a planar (two-dimensional) structure. This maximises the trees’ use of available light.

The Government support, which comes from the Ministry for Primary Industries’ (MPI) Sustainable Food and Fibre Futures fund (SFF Futures), sits alongside the $1.1 million committed to the project by Plant & Food Research, and industry partners New Zealand Apples and Pears, Rockit Global, and Summerfruit New Zealand.

The five-year project, led by Dr Ben van Hooijdonk and Dr Jill Stanley from Plant & Food Research, is being delivered with AgFirst Consultants NZ and industry representatives. The project aims to investigate barriers in adopting new growing systems, validate and refine FOPS performance, and support uptake of emerging technologies. . . 

MPI assessment of the potential for a new primary industry based on industrial hemp :

The NZHIA congratulate MPI on the release of their 60 page “Facilitating growth in the New Zealand Hemp Industry” report.

The report was independently prepared by Sapere and recognises the industrial hemp industry is “rapidly developing internationally, driven by recent deregulation and increasing interest in and demand for its use in a range of products”.

The report identified a number of comparative advantages for hemp production in Aotearoa New Zealand. Based on our strong track record in plant and food science and innovation, strong agronomic fundamentals, our “clean and green” image and availability of water in potential growing regions.

“These advantages can be leveraged to create a new primary food and fibre industry in regional Aotearoa New Zealand,” says Richard Barge, Chair – NZ Hemp Industries Association Inc. . . 


Sowell says

16/12/2021


Taxing times

16/12/2021

This really is a taxing government:

The Government’s biofuel mandate will be another cost that will see motorists paying twice at the pump for carbon emissions, National’s Transport spokesperson Simeon Brown says.

“Every litre of fuel Kiwis use already faces an 18 cent cost under the existing Emissions Trading Scheme. Adding a biofuel mandate on top of that will simply be another cost for the same outcome already being achieved by the ETS.

“MBIE stated that the introduction of the biofuel mandate will increase the price of petrol by 0.4 cents per litre, diesel by 7.1 cents per litre, and jet fuel by 7.1 cents per litre (or 11.2 per cent).

“Overall, it is estimated the economic cost of the policy will be over $1.2 billion. Yet as New Zealand already has a cap on our emissions, there will be no reduction in New Zealand’s total emissions.

“Essentially, this is a policy to make it more expensive for New Zealand to achieve emissions reduction targets, and to make petrol and diesel more expensive at the pump.

“At a time when Kiwis are paying more for petrol at the pump than ever before, the Government needs to grant relief to motorists by removing the Auckland regional fuel tax at a minimum.

“The mandate will be particularly hard for farmers who are already facing the introduction of the new ute tax, as the biofuel mandate could increase the price of diesel by 7 cents per litre.

“While National is supportive of biofuels and reducing our carbon emissions, the Government cannot double dip into Kiwis’ pockets by taxing them through the ETS and the biofuel mandate.”

The taxing doesn’t stop at the petrol pump:

Grant Robertson is riding inflation to execute an unjustifiable tax grab, says the New Zealand Taxpayers’ Union in response to today’s Half Year Economic and Fiscal Update.

Speaking from the HYEFU Treasury lock-up, Union spokesman Louis Houlbrooke, “The Government is set to increase its tax take by an extra $7 billion each year for the next five years. That’s perverse in the context of a pandemic that has left businesses reeling and households facing rising living costs. New Zealanders deserve tax relief, but Grant Robertson seems proud to be taking more and more.”

“A major cause of Grant Robertson’s revenue bonanza is inflation, which is now forecast to hit 5.6% next year. Inflation this high should be intolerable – there’s a reason the Reserve Bank targets 1-3%. But rising living costs are made even more painful by the Government’s refusal to adjust income tax brackets to keep up.”

“Someone on the average salary ($58,836) is set to pay an extra $955 in income tax next year, assuming they’re lucky enough to get an inflation-level pay rise. Of course, their real pre-tax buying power will be no higher, so eitherway everyone is left poorer.”

“In response to a question from Brad Olsen of Infometrics, Grant Robertson flatly ruled out the adjustment of income tax brackets, and made no apology for his Government’s contribution to inflation via massive spending.”

“Tax brackets haven’t been adjusted for a decade. National and Labour might have thought taxpayers wouldn’t notice slow, inflation-driving tax creep, but with inflation curving up, the elephant in the room is now impossible to ignore.

“Taxpayers need relief from the corrosive effect of inflation. Grant Robertson’s refusal to acknowledge this is cruel.”

The government’s refusal to adjust income tax brackets adds more tax insults to the other taxing injuries it is inflicting on us:

Today’s Half Year Economic and Fiscal Update (HYEFU) confirms that despite a hot economy where everyone is competing for scarce labour and resources, Finance Minister Grant Robertson isn’t easing off his big debt-funded spend up and that will fuel inflation and hurt Kiwis, National’s Finance spokesperson Simon Bridges says.

“Improved macro fiscals like a higher tax take and lower expected net core Crown debt are all well and good, but that doesn’t wash with Kiwi families who are being burnt by price rises that far outstrip wage increases.

“Core government spending is forecast to run a whopping 68% higher since Labour took office this year. The HYEFU reforecast shows government spending remaining high even post-Covid.

“While elevated spending levels were appropriate through much of the pandemic, many economists and the likes of the Reserve Bank now confirm its an overheating economic picture where adjustments and some easing off is required. Otherwise Labour is just outbidding private players for land, building supplies, and motel rooms, and forcing prices up across the board.

“Not all spending is good investment and you can have too much of a good thing. What’s more, an awful lot of it is being funded by borrowing, which means it has to be paid back eventually.

“The real kicker though is that this spending is pushing inflation higher and that in turn is forcing the Reserve Bank to keep hiking up interest rates. More than half our inflation is from the non-tradables sector and so home grown, and at 4.9 per cent its growing faster than it has in over 30 years, much faster than in Australia (3 per cent), and much faster than wages at 2.4 per cent.

“Inflation is literally taking money out of Kiwis’ pockets and making us poorer. Whether it’s the mum at the supermarket, the tradie at the petrol station or the young person trying to buy a first home, inflation is making things much, much harder.

“With all Grant’s spending, it’s up to the Reserve Bank to come to the rescue, pushing interest rates higher than they might otherwise need to go.

“We are saying ‘rein it in a bit Minister’. Take off some of the pressure on inflation and interest rates and give Kiwis an economic fair go. Your hot economy is burning us.”

Inflation is theft – it steals the real value of money including wages and savings.

The government’s low value spending is adding fuel to the inflationary fire and the increase in interest rates that will follow will turn up the heat even more.


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