Rural round-up

August 12, 2018

Lumsden birthing centre closure prompts community anger – Tess Brunton:

The Lumsden Rural Women’s network is calling for the decision to shut its local birthing centre to be reversed.

The Southern District Health Board today announced the unit would become a maternal and child hub, where babies are only delivered in an emergency.

The DHB today released a plan that also included four other hubs to be established in Wanaka, Te Anau, Tuatapere and Ranfurly; funding support for midwives working in remote locations; and investment in technology to support care. . . 

Lessons from dairy can help NZ red meat sector develop winning formula in China:

New Zealand’s red meat sector should draw on the experiences of the dairy sector to help formulate its strategy for continued growth in the Chinese market, according to RaboResearch General Manager Tim Hunt.

Speaking at the Red Meat Sector conference in Napier last week, Mr Hunt said the Chinese market offered significant growth potential for New Zealand’s red meat sector and there was much the industry could learn from New Zealand dairy. . .

T&G Global lifts first-half operating profit 40% on improvements in pipfruit, international produce – Tina Morrison:

Aug. 9 (BusinessDesk) – T&G Global, New Zealand’s biggest fresh produce grower, distributor, marketer and exporter, posted a 40 percent jump in first-half operating profit due to improved performances from its pipfruit and international produce businesses, its two largest units.

Operating profit, which gauges the underlying performance of the business, rose to $10.4 million in the six months ended June 30, from $7.5 million in the year earlier period, the Auckland-based company said in a statement. . .

Sustainable plastic recycling solution for farmers:

As plastic waste hits the headlines again, rural recycling programme Agrecovery assures farmers and growers that it offers a complete and sustainable local solution for empty agrichemical containers and drums.

This plastic is collected from over 80 sites and large-scale farms across the country and taken to Astron Plastics in Auckland, where it is reborn as underground cable cover and building materials to prevent rising damp. . .

Tighter import rules to stop stink bug:

New treatment and cleaning rules for imported vehicles and machinery will make it harder for brown marmorated stink bug to make landfall in New Zealand, says the Ministry for Primary Industries.

MPI released the new import health standard for vehicles, machinery and equipment today. It will come into force on 1 September – the beginning of the stink bug season. . .

How Australia’s meat industry plans to flood post-Brexit Britain with products banned in EU – Josh Gabbatiss:

Australian meat industry leaders are heavily lobbying their government to put pressure on Britain to accept products currently banned under EU law after Brexit.

Among the meat products suggested for export to the UK are hormone-treated beef and “burnt goat heads”.

Ministers from both countries met last week to discuss the future of their trading relationship, amid concerns that the Australian government could force the UK to lower food standards.

It comes as a petition supporting The Independent’s campaign for a Final Say on Brexit passed 570,000 signatures. . .

Norway up to 60% crop loss :

The worst grain crops in more than 50 years.

The farmers despair over what seems to be the worst season for grain crops since the early 1960s. “Extreme situation”, says an advisor.

– I do not think the regular Joe understands what’s going on. This is an extreme situation that we have never experienced before, says grain advisor in Norwegian Farm Counsellors (Norsk Landbruksrådgiving), Bjørn Inge Rostad to Aftenposten.

The grain farmers are unevenly affected, but Rostad thinks the grain crops can be down to 40 per cent of what is normal.
Chairman of the Board in the Cereal Producers’ Organization, John Lilleborge also believes that the production is a halved on a nationwide basis. . . 

World’s first Manuka honey jar with 11 separate counterfeit measures available September:

The world’s first Manuka honey jar with eleven separate consumer security and anti-counterfeit measures is available to purchase nationwide and online on from September. Boasting New Zealand’s highest standard of Manuka honey, PURITI Manuka comes in a customised cylindrical jar with a unique lid that features a thick anti-tamper seal.

The jar and lid have the same diameter, allowing for a smooth and seamless fit and a distinctly different visual appearance. This design is unique to PURITI Manuka. The jar also features a tear strip for additional consumer security. . .


Rural round-up

August 11, 2018

Our farmed meat is a green food – Neal Wallace:

Exporters are not shy in promoting New Zealand red meat as grass-fed and free-range but recent studies by Oxford and Otago Universities have lumped our system in with feedlots to claim the industry is environmentally degrading and unsustainable. Neal Wallace investigates the true environmental impact of grass-fed beef.

Work to differentiate the environmental footprint of New Zealand’s pasture-based red meat sector from feedlot systems that have a far greater impact has begun.

Beef + Lamb NZ chief insight officer Jeremy Baker said NZ grass-fed, free-range beef has been included in international studies that claim beef production is a major contributor to climate change. . . 

Fonterra fund units drop to 3-year low as investors grow dark on capital structure – Paul McBeth:

Aug. 10 (BusinessDesk) – Fonterra Shareholders’ Fund units, which gives outside investors exposure to Fonterra Cooperative Group, fell to a three-year low after the latest dividend downgrade added to scepticism about the efficacy of the cooperative’s structure.

The units dropped 2.7 percent to $4.97, adding to a 20 percent slide so far this year, and fell as low as $4.95, a level not seen since September 2015 when Fonterra was hit by a slump in global dairy prices and offered interest-free loans to its farmer shareholders to tide . . 

Fonterra announcement disappointing, definitive plan of action required:

Duncan Coull, Chairman of the Fonterra Shareholders’ Council, has expressed his absolute disappointment with today’s Board decision to reduce the 2017/18 forecast Farmgate Milk Price by five cents to $6.70 per kg/MS in order to support the balance sheet, and the decision to retain more of the Co-op’s earnings which will likely see no further dividend payment to Shareholders over the 10 cents distributed earlier in the year.

Mr Coull: “I can understand the Board’s rationale and that it is prudent to protect the balance sheet, but the fact that we find ourselves in this situation is unacceptable. . .

Fonterra’s credit rating safe but Shareholders’ Council labels payout cut ‘unacceptable‘ – Rebecca Howard:

(BusinessDesk) – S&P Global Ratings said there is no immediate impact on its rating on Fonterra Cooperative Group from the group’s lower farmgate milk price and dividend guidance for the year ended July 31, issued this morning.

However, the Fonterra Shareholders’ Council expressed deep disappointment, saying “the fact that we find ourselves in this situation is unacceptable” and took the unusual step of questioning the cooperative’s value creation record at a time when a new chief executive is being sought and the chairmanship has unexpectedly changed. . . 

Three Rivers catchment group catch up in Southland – Nicole Sharp:

Southland farmers are leading the way in environmental practices and 17 catchment groups are now established in the region. With six more in the wings, and half the region covered, reporter Nicole Sharp looks into some of the achievements to date.

When a group of farmers put their minds to it, anything is possible.

That is how the catchment group idea started in 2013, when some farmers in the Balfour area formed a group. . . 

Canterbury woman Ash-Leigh Campbell elected new chair of NZ Young Farmers Board:

A woman is at the helm of the NZ Young Farmers Board for the first time in 12 years.

Ash-Leigh Campbell was elected chair of the eight-member board yesterday, replacing Jason Te Brake.

The 27-year-old is a technical farm manager with Ngāi Tahu and helps oversee the management of eight dairy farms.

“I feel extremely privileged to be elected chair. I’m really looking forward to the role,” said Ash-Leigh. . .

Cereal yields down but growers remain positive:

Total hectares sown in wheat and barley this season is predicted to decrease by around 8%, but growers are positive about future prospects, Federated Farmers Arable Chairperson Karen Williams says.

Results from the Arable Industry Marketing Initiative (AIMI) July 1 Cereal Survey are out and confirm average yields are down compared to last season. Milling and feed wheat yields were down 12%, malting barley down 9%, feed barley down 10%, milling oats down 17% and feed oats down 6%.

“This is no surprise and reflects variable growing conditions (hot, dry, wet, cold) throughout the key crop establishment periods in late spring and early summer,” Karen says. . . 

Major international agritech announcement expected for NZ

In less than a fortnight, more than 30 New Zealand agritech leaders will make history in Silicon Valley.

They will be part of the international 2018 Silicon Valley agritech immersion programme and Conference, involving Silicon Valley Forum, Tauranga’s Wharf42, Agritech New Zealand, Callaghan Innovation, and New Zealand Trade and Enterprise.

Agritech New Zealand executive director Peter Wren-Hilton says the four-year-old Silicon Valley agritech connection will have a significant and long-term impact on New Zealand’s emerging agritech sector. . . 

Kerrygold butter is being taken to court over ‘false’ grass-fed cows claim – Katie Grant:

Customer can’t believe it’s not butter made from exclusively grass-fed cows

The company behind Kerrygold butter is facing legal action for advertising its products as being made from the milk of grass-fed cows.

A US customer has taken umbrage with the butter maker, hitting it with a class action lawsuit claiming that Kerrygold has “misled” consumers, leaving them “unable to exercise their right to choose grass-fed products”.

Kerrygold cow diet Kerrygold cows are fed grass, but not exclusively – they also eat various grains such as soy and corn at certain times of the year, according to Dyami Myers-Taylor, the customer in question. . .


Fonterra drops milk price

August 10, 2018

Fonterra has announced a 5 cent drop in the forecast farmgate milk price for the 2017/18 season:

The Co-operative is reducing last season’s 2017/18 forecast Farmgate Milk Price to $6.70 per kgMS from $6.75 per kgMS. The previously announced 25-30 cents guidance range has been held but the Co-operative is indicating that it will be at or slightly below this range and it is likely that the full year dividend will be just the 10 cents already paid in April.

Chairman John Monaghan said the Board has made these decisions in the best long-term interests of its farmer shareholders and unitholders.

“It is important for our Co-operative to have a strong balance sheet and, as we indicated in May, the higher milk price, which is good for our farmers, has put pressure on Fonterra’s earnings, and therefore our balance sheet in a year which was already challenging due to the payment to Danone and the impairment of the Co-operative’s Beingmate investment.

“You never want to have to reduce the Milk Price at the season’s end, but it is the right thing to do and $6.70 remains a strong milk price.

“Maintaining a strong balance sheet has helped us to support farmers during tough seasons through our Co-operative Support Loan and being able to bring forward the Advance Rate Schedule and get money to farmers earlier in the season.

“We need to do everything within our control to keep these options on the table for when farmers need them. This means keeping our balance sheet strong.

Mr Monaghan said he wanted to be upfront with farmers and unitholders that to achieve this the Board has taken the step to depart from the amount calculated under the Farmgate Milk Price Manual. This is permitted within Fonterra’s Constitution.

“During the process of closing our books for the financial year end, the need for these actions has become clear. Our forecast performance is not where we expected it would be. While the numbers are not finalised, our margins were less than we forecasted right across our global Ingredients and Consumer and Foodservice businesses.”

The Co-operative’s full year results will be announced on 13 September 2018.

This is disappointing but not unexpected.

It’s also a reminder that the forecast milk price can change and that budgets should be conservative until its confirmed.


More bloody meetings

August 8, 2018

Prime Minister Jacinda Ardern’s return from maternity leave was supposed to start with an announcement to boost business confidence.

Instead of which she introduced Trade for All which is once again more hui and little doey.

It’s a bit like putting the produce-laden cart before the lumbering Clydesdale as the Government tries to bring the public on board with free trade deals and what they’re calling a ‘Trade for All’ agenda.

It seems a bit like the coalition cobbers trying to salve their guilt for opposing the likes of the old Trans-Pacific Partnership and now supporting it since its name has become more of a mouthful with Comprehensive Progressive added to its title. . . 

And just like all Government announcements without substance they’re setting up a board to advise on how to woo the great unwashed when it comes to trade. And as usual they’ve appointed the chair with the boardroom chairs to be filled later, or as the blurb said “in due course”.  

There would be no need to spend time and money trying to improve their supporters’ poor perception of, and misconceptions about, trade had Labour not spent so much effort in opposition campaigning against it in contradiction of the long-established bi-partisan approach both Labour and National took in the past.

This is using taxpayers’ money to talk to their supporters because most other people understand the benefits and importance of trade.

Their blurb was stating the bleedingly obvious, they want trade benefits to flow to all New Zealanders, they want them to be felt throughout the country, not just in the major cities. . 

Trade has always benefited the whole country for goodness sake. Most of our significant exporters are in rural New Zealand, they’re called dairy, sheep and beef farmers, winegrowers and orchardists. They do well and the whole community benefits.. . .

Businesses will be relieved that Labour has seen the trade light again, but setting up yet another committee and doing yet more consultation won’t help confidence.

The Government’s ‘Trade for All’ agenda is simply a rehash of National’s work on trade and won’t make up for plummeting business confidence caused by the Government’s anti-growth policies, National’s Trade spokesperson Todd McClay says.

“Trade for All is nothing more than a shameless rebranding of National’s Trade Agenda 2030 which was aimed at creating opportunities for our exporters to compete on the world stage.

“But while National was consulting on Trade Agenda 2030 with businesses, exporters and the public Labour, NZ First and Green MPs were marching in the streets against the TPP.

“While the Government’s backflip on trade is welcome, it won’t be enough to turn around New Zealand’s worst business confidence levels in ten years.

“We know this is a direct result of bad policies like raising taxes, restricting foreign investment and axing oil and gas exploration – yet the Government refuses to acknowledge that, choosing instead to lecture businesses over their supposed bias. . . 

Instead of action, all this announcement offers is more talk.

And rather than providing reassurance it merely shows that the government doesn’t understand business and has no idea how to address the understandable and growing lack of confidence.

Businesses don’t need yet another bloody committe and more bloody meetings.

They need policies which recognise the importance and value of business.


Rural round-up

August 7, 2018

Wool gets revived as tide turns on synthetics’ pollution of the seas – Heather Chalmers:

A new wave of socially and environmentally-conscious consumers are turning to natural fibres for their clothing and homes, rejecting polluting synthetics and plastics.  

New Zealand wool companies are already tapping into this trend, promoting wool as a natural, biodegradable and renewable replacement.

But while momentum is growing, returns remain stubbornly low for the coarser end of New Zealand wool clip.   

While shoppers may think they have done their bit for the environment by ditching plastic bags, they are being advised to look at what they are wearing and how their house is carpeted, furnished and insulated.  . . 

 Wrightson shares jump 9.4% on plans to sell seeds unit for $439M; may distribute cash – Tina Morrison:

(BusinessDesk) – Shares in PGG Wrightson jumped as much as 9.4 percent after the country’s largest rural services business said it had agreed to sell its seed and grain business to Danish cooperative DLF Seeds for $421 million in cash and $18 of debt repayment, and signalled it may return up to $292 million to its shareholders.

The sale is above the $285 million book value of the seeds business and follows several expressions of interest received from international parties as part of a strategic review underway with Credit Suisse (Australia) and First NZ Capital. The Christchurch-based company expects to have a net cash balance of about $270 million following the sale and could distribute as much as $292 million to shareholders. . . 

A2 doubles stake in Synlait at 23% discount – Sophie Boot:

A2 Milk will buy another 8.2 percent of Synlait Milk, doubling its stake in the company.

The milk marketing firm will buy the shares at $10.90 apiece, down 2.3 percent from the NZX one month volume weighted average price of $11.16, for a total of $161.8 million. The shares will come from Tokyo-listed Mitsui & Co, a general trading company which invests across sectors and bought 8.4 percent of Synlait at the company’s initial public offering in 2013. . .

 

New Zealand red meat sector strongly opposes European Union and United Kingdom’s WTO quota proposal;

Beef + Lamb New Zealand and the Meat Industry Association strongly oppose the European Union (EU) and United Kingdom’s (UK) proposal to ‘split’ the EU’s World Trade Organisation (WTO) Tariff Rate Quotas between them.

The UK and EU have officially notified the WTO of their draft tariff schedules, which propose to split tariff rate quotas that allow access for New Zealand sheepmeat and beef exports. . .

Trade outlook still bright, but not without challenges – Allan Barber:

Vangelis Vitalis, Deputy Secretary for trade at MFAT and chief negotiator for the CPTPP due to take effect early next year, gave a very thorough and enthralling presentation on the trade landscape to the Red Meat Sector Conference in Napier on Monday.

Free trade and market access are a key area of interest to the New Zealand meat industry and the economy as a whole. Vitalis stated that three assumptions underpin New Zealand’s international trade negotiations: . . 

MPI sets the record straight with Forest & Bird:

Ministry For Primary Industries 2 August 2018 MPI is disappointed that Forest and Bird thinks it necessary to make inaccurate claims about combined efforts to prevent the spread of Kauri dieback.

Forest and Bird has advised MPI that it is closing off its reserves with wild kauri as a further measure to prevent the spread of kauri dieback, says Roger Smith, Head of Biosecurity New Zealand (a part of MPI). “We welcome all efforts to protect our kauri and have been working in partnership with a wide range of organisations to support their local efforts. . .

Tour leader found with fruit fly:

Fruit fly larvae carried by a tour party leader could have devastated New Zealand’s horticulture industry, says Biosecurity New Zealand.

Biosecurity officers intercepted the larvae last month in undeclared food with a holiday group from Malaysia at Auckland Airport, says Biosecurity New Zealand Passenger Manager, Craig Hughes.

The larvae was found in chillies following x-ray screening of the tour leader’s baggage. A caterpillar was also detected in some garlic bulbs carried with the undeclared food. . .

Rabobank Wine Quarterly Q3 2018: Status Quo Under Pressure in US Route-to-Market

The US has emerged as the largest wine market in the world, and by most measures, the most profitable and attractive. While wineries – both foreign and domestic – recognise the profit potential of the market, it is also widely seen as an exceptionally-difficult market to penetrate (particularly for small wineries), according to the latest RaboResearch Wine Quarterly report.

Route to the US consumer

Major changes are occurring today in how wine reaches the US consumer. “Changes in technology, business models and market structure are disrupting the global wine market and creating new sets of winners and losers among wholesalers, retailers and suppliers,” according to Stephen Rannekleiv, RaboResearch Global Strategist – Beverages. “Responding quickly to these changes will determine who survives, who thrives, and who fades away.” . .

Boy, 10, raises $60,000 in ‘Fiver for a farmer’ campaign – Shelley Ferguson:

More than $60,000 has been raised for drought-stricken farmers through a campaign started by children at a Sydney school last week.

Jack Berne, a grade four student at St John the Baptist Catholic School in Freshwater, was the instigator of “a fiver for a farmer”, and was inspired to help after learning about the struggles of those on the land in class.

Last week, Jack wrote a letter to media outlets as he tried to generate support for the cause after telling his mum that their teacher always tells them, “we can use our small and mighty voices” ..  . 


Free trade falters

August 3, 2018

Free trade is faltering:

The man who led the New Zealand team in key global trade negotiations says the world is seeing the worst rise in trade protectionism in 23 years.

Vangelis Vitalis, from the Ministry of Foreign Affairs and Trade, spoke to RNZ at a conference of the meat industry in Napier.

He said years of eased trade rules were in danger of being reversed, and this must be dealt with.

“We have seen 400 new protectionist measures to May have been put in place.

“We know that non-tariff barriers cost the wider agricultural sector of New Zealand up to $6 billion a year in restricted access. These have a profound impact.

“We are seeing the sharpest rise in protectionism since 1995, especially in the last six months.” . . 

This isn’t just a threat to exporters, it’s a threat to the whole economy.

Trade restrictions don’t just hurt businesses exporting to a country which imposes tariffs. They hurt businesses in the importing country trying to export to other countries which impose tariffs in response.

There’s no better illustration of that than this Trump Toon at Inquiring Mind.

By making it harder for businesses to sell their goods to the USA, Trump’s tariffs are making it harder for USA producers to export their goods.

Trump responded by giving subsidies which is a cost to taxpayers who are the consumers who are having to pay more for imported goods.

The inability to export will result in a glut in the domestic market which will depress prices. That might help consumers in the short-term but anything they gain in lower prices will come at their cost as taxpayers who pay for the subsidies.

I’m old enough to remember what it was like in New Zealand before we embraced free trade.

Tariffs were in effect a consumer subsidy for local industries which left consumers with less choice, often lower quality, and always higher prices on a whole range of goods from necessities to luxuries.

The whole system of tariffs, import and export licences, and subsidies was ripe for exploitation, manipulation and corruption.

It gave power to politicians, created work for bureaucrats and helped the favored few at the cost of the many.

The transition to an open economy wasn’t easy, but it has been worth it.

We are no longer producing low quality food in quantities too great to sell. Production is market led, aimed at what consumers want not political and bureaucratic whim.

There is little risk that New Zealand will close its borders again but we could be caught in the crossfire as trade wars between other countries escalates.


Rural round-up

August 2, 2018

Farmers seek off-farm income to counter rising costs – Heather Chalmers:

A farming leader says it is no surprise that farms are increasingly reliant on off-farm income.  

A Lincoln University survey has shown just over a quarter of farms obtained 30 per cent or more of their income from off-farm sources.

Farmers were struggling to keep up with the mainly inflation-caused price squeeze, the survey found. But the authors said some families found the rural lifestyle compensated for tight finances. . .

Dairy farm effluent compliance in Tasman District coming up roses – Cherie Sivignon:

Tasman district deputy mayor Tim King says the result of the 2017-18 dairy farm effluent compliance survey is a “good story all round”.

It revealed 90 of the 96 farms inspected were fully compliant for effluent management. The other six, graded non-compliant, comprised five with minor ponding and one that failed to adhere to setback rules.

In a report on the matter, council compliance and investigation officer Kat Bunting says all six instances of non-compliance were considered a minor breach of the rules that resulted in “no adverse environmental effect”.

Formal written warnings with directions for improvements were sent to those six farms and return visits found full and continued compliance. . .

Rabobank Global Dairy Top 20 – A Shuffling of the deck chairs:

Dairy price recovery in 2017 has positively affected the combined turnover of the top 20 global dairy companies, which, in 2017, was up 7.2% on the year in US dollar terms and 5.1% in euro terms, according to RaboResearch’s latest Global Dairy Top 20 – A Shuffling of the Deck Chairs report.

“For the second consecutive year, there were no new entrants to the Dairy Top 20 list, with the USD 5bn threshold difficult to achieve due to a scarcity of large acquisitions or mergers.” says Peter Paul Coppes, Senior Analyst – Dairy. “However, while the names have remained the same, the order shifted in 2017.” . . 

UK’s Daily Mail urges Theresa May to listen to Kiwi trade expert– Point of Order:

Brits who may be despairing at the lack of progress on Brexit, as Britain’s political class trade blows and the process becomes bogged down in politicking, have been told “there is a small corner of a government department that they can turn to for cheer”.

This is the office of New Zealand’s Crawford Falconer, Chief Trade Negotiation Adviser at the Department of International Trade, described by the Daily Mail as

“… a man of immense experience in such matters. And, in contrast to the doomsayers, his message about Brexit is one of almost unbounded optimism.”

 The article goes on to say: . .

Comvita touted as potential bidder for Manuka Health company – Tina Morrison:

(BusinessDesk) – Comvita, the NZX-listed manuka honey company, declined to comment on whether it is interested in making a bid for honey company Manuka Health New Zealand which has reportedly been put up for sale by its Australian owner Pacific Equity Partners.

The Australian newspaper suggested Comvita or its largest shareholder China Resources Ng Fung as possible buyers of Manuka Health, which was put on the market about six weeks ago for more than A$200 million by PEP and advisers Luminis Partners. Manuka Health was reportedly sold to the Australian private equity firm in 2015 for $110 million. . .

 

Inter-club challenge still going strong:

The last hurrah for the Canterbury dog trial season, the annual Inter-Club Challenge, was held at Waihi Station, home to the Geraldine Collie Club, on July 1.

The day turned from a ”rugged-up” winter’s morning to a balmy northwest afternoon.

The Canterbury Centre is one of the largest centres in New Zealand,comprising 18 club trials stretching from Cheviot in the north to Mackenzie in the east and Levels (Timaru area) in the south, encompassing all areas in between.

In its 25th year of competition, the trial attracted a strong gallery of spectators and team supporters from throughout the province, testament to the strength and popularity of the sport. . .

Strong interest expected with vacant governance roles on Ballance board:

 A “genuine and rare governance opportunity” has opened up with one of New Zealand’s industry-leading rural co-operatives with Ballance Agri-Nutrients announcing that two farmer-elected directors will be stepping down from its Board this year.

Ballance shareholders are currently being notified of the vacancies created by the decisions of Gray Baldwin not to seek re-election, and Donna Smit who is standing down in the North Island Ward (N). Murray Taggart is retiring by rotation (as required under the Co-operative’s Constitution) and seeking re-election in the South Island Ward (S). . .

MyFarm launches $17.6m Hop Garden investment

MyFarm has launched a $17.64 million investment into what will become New Zealand’s largest hop garden.

The opportunity to invest in Tapawera Hop Garden Limited Partnership includes the purchase of a 96-hectare property and the lease of a second 50-hectare property which will be developed into a 116 canopy (effective) hectare garden. Half of the garden will be planted this spring alongside other development such as building hop picking and drying facilities and worker accommodation. . . 


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