Rural round-up

July 20, 2019

Social licence about trust – Sally Rae:

Penny Clark-Hall is passionate about helping rural communities.

Ms Clark-Hall is the founder of New Zealand’s first social licence consultancy, helping farmers and agri-businesses earn and maintain their social licence to operate.

She is excited about speaking at the Women’s Enviro Evening in Clinton later this month, saying meaningful change had to come from grassroots, or “the ground up”.

That had a domino effect and, if everyone did their “own little bit” then it all added up to something big, she said. . .

Need for study of winter grazing – Sally Rae:

There is no place in modern farming for winter grazing practices that compromise animal health and welfare, the New Zealand Veterinary Association says.

Chief veterinary officer Dr Helen Beattie, of Dunedin, has strongly advocated for a national-level, pan-sector working group to be formed, saying a collaborative approach is needed to assist farmers through a fair transition away from such practices.

Intensive winter grazing was common and could lead to poor animal welfare and environmental damage, particularly during prolonged periods of wet weather, Dr Beattie said.

“We need to take a second look at these practices and, when animal welfare isn’t protected, find solutions that rectify this safely,” she said. . .

Thinking outside the square – Jenny Ling:

A Waikato couple are finding doing things a bit differently is paying off. Jenny Ling reports.

Hard work, a shared passion for science and technology and sheer grit and determination are helping a Waikato dairy farming couple create their dream property and life together.

Bill and Michelle Burgess milk 340 cows on 100ha of prime land in Te Poi, a small but thriving farming area 10km south of Matamata.

Here they milk and manage their elite herd of mostly Friesian and Friesian crosses and a small amount of Jerseys, while raising their two children, Alex, 3, and Sophie, 5. . . 

Government ‘don’t have a clue’ when it comes to rural living – Kate Hawkesby:

Interesting that 6,000 Aucklanders have moved to Northland over the past 4 years. 

I’m not surprised. 

Auckland traffic’s a nightmare, public transport isn’t up to scratch, property prices are still excessively high, and I think these days we’re getting better at prioritising quality of life. 

We bought a place in the country on a whim, and we haven’t looked back. 

There’s something very soothing about rural life.. trees, birds, animals, rolling hills, quiet roads.  . .

Farmers help pooh-powered milk lorries become a reality :

Farmers who supply Arla are starting to make the most of their cow’s manure by using it to power up milk lorries.

Farmers in Sweden are contributing to a fossil-free fuel future by turning manure into biogas, which in turn powers vehicles.

Biogas can also be a source of the income for farmers, and the biomass that remains after the cow manure is digested can be used as a fertiliser. . .

Rejoice: the earth is becoming greener – Matt Ridley:

Amid all the talk of an imminent planetary catastrophe caused by emissions of carbon dioxide, another fact is often ignored: global greening is happening faster than climate change. The amount of vegetation growing on the earth has been increasing every year for at least 30 years. The evidence comes from the growth rate of plants and from satellite data.

In 2016 a paper was published by 32 authors from 24 institutions in eight countries that analysed satellite data and concluded that there had been a roughly 14% increase in green vegetation over 30 years. The study attributed 70% of this increase to the extra carbon dioxide in the atmosphere. The lead author on the study, Zaichun Zhu of Beijing University, says this is equivalent to adding a new continent of green vegetation twice the size of the mainland United States.

Global greening has affected all ecosystems – from arctic tundra to coral reefs to plankton to tropical rain forests – but shows up most strongly in arid places like the Sahel region of Africa, where desertification has largely now reversed. This is because plants lose less water in the process of absorbing carbon dioxide if the concentration of carbon dioxide is higher. Ecosystems and farms will be less water-stressed at the end of this century than they are today during periods of low rainfall. . .

 


Rural round-up

November 9, 2015

Alliance in good shape, Donald says – Sally Rae:

He’s been sitting around the board table at Alliance Group for 24 years but Murray Donald has finally called time.

Come December 17 and the Southland farmer will be gone, as he is standing down as a supplier representative at the company’s annual meeting in Oamaru.

Mr Donald (54), who farms near Winton, and fellow long serving director Doug Brown, of Maheno, who was elected in 2001, have decided not to seek re election. . . 

Exit from EU could cripple UK agriculture – Allan Barber:

A new report by agricultural consultancy Agra Europe entitled Preparing for Brexit suggests leaving the EU, to be determined by a referendum in 2017, could destroy the British farming sector. The authors have based their forecast on the Coalition government’s 2013 Fresh Start Policy document which theorised that British agriculture could imitate New Zealand and Australia’s success in surviving, even flourishing, in a post-subsidy world.

Not surprisingly there is plenty of scepticism about the realistic prospect of either of these scenarios eventuating. If British voters chose the Brexit option, it is most unlikely any government would eliminate all subsidies, while a cursory glance at the proportion of farm income from EU Common Agricultural Policy payments shows how laughable it would be to expect them to become suddenly profitable. . . 

Contest continues to hold appeal – Sally Rae:

Chris Pemberton was just a lad when he competed in the Young Farmers Contest.

It was 2005 and, at 17, Mr Pemberton was one of the youngest regional finalists in the contest’s then 36-year history.

He was still at boarding school at St Kevin’s College when he competed in the Aorangi regional final.

While unplaced, he performed creditably and was a favourite with the crowd. . . 

Spaans new DairyNZ head – Stephen Bell:

Waikato dairy farmer Michael Spaans has been elected the new chairman of DairyNZ.

The industry-good body held a special meeting of the board this weekend.

Spaans will serve an annual term as chairman, leading an eight-member board made up of five farmer-elected and three independent directors.
He replaced long-serving chairman and former Cabinet minister John Luxton who retired from the DairyNZ board last month after 12 years of service on dairy industry bodies. . . 

Yashili New Zealand’s Pokeno factory opens – Gerald Piddock:

Yashili New Zealand Dairy Co has opened its new state-of-the-art infant formula manufacturing plant in Pokeno, south of Auckland.

The 30,000m2 plant will employ 85 staff and have an annual production capacity of about 52,000 tonnes of formula product. It will produce formula under the brand ‘Super Alpha-Golden Stage Infant Formula’ with shipments to China expected to begin in early 2016.

Yashili New Zealand is a leading producer of infant milk formula for the domestic market in China. It was founded in July 2012 and is a subsidiary of Yashili International Holdings and Mengniu Dairy Co.  The new factory took three years to build and cost $220 million. The company’s goals were to produce the highest quality infant formula and raise the healthiest babies in China. . . 

Yashili, Arla and Danone sign agreement – Gerald Piddock:

Yashili International along with European dairy producers Arla and Danone have entered into global strategic cooperation agreement.

Signed at the opening of Yashili’s new infant formula plant at Pokeno on November 6, the agreement will see the three companies work closer together in supplying products into Arla and Danone’s markets.

“It is a significant agreement between these two great dairy producers who are each committed to the highest standard of food quality and safety,” Yashili International Holdings president Lu Mingfang said. . . 

 


Rural round-up

December 17, 2013

Canterbury suffers another blow:

Farmers are reeling from yet another blow, after a severe localised hail storm tore its way through the Mayfield area of Mid-Canterbury.

“As the year draws to a close and we are fast approaching harvesting season, Mid-Canterbury farmers are facing a financial nightmare after the hail storm yesterday,” says David Clark, Mid-Canterbury Grain and Seed Chairperson.

“This has been a mongrel year for farmers in Mid-Canterbury; we have gone from snow to wind storms to a very dry spring to now this. It is a horrible way to finish off the year, with radish and carrot crops shredded and wheat and barley crops having the stuffing knocked out of them. . .

A timely reminder:

Fonterra dropped a bombshell last week when it announced its latest consideration on its farmgate milk price.

For farmer shareholders in New Zealand’s largest company, it had been shaping up to be a particularly merry Christmas, with economists suggesting the milk price could be lifted as much as 40c.

Elevated prices, which have defied predictions and remained at very high levels – the GlobalDairyTrade price index was just 7% below its April high and about 50% higher than a year ago – raised expectations for the forecast to rise. . .

UK butter eaters lose taste for Anchor after dairy giant cuts NZ ties – Nicholas Jones:

British shoppers have noticed that their favourite Anchor butter tastes different – with the explanation being it’s no longer from New Zealand.

In Britain, the famous Kiwi brand is used by European dairy company Arla. Until recently, Arla had shipped over New Zealand butter made by Fonterra, but has now switched production to its British facilities.

The Arla logo has been added to block butter packs, but the company has faced a number of complaints from disgruntled customers who were unaware of the change. . .

How much dairying is too much in terms of water quality? – Daniel Collins:

On 21 November the Parliamentary Commissioner for the Environment, Jan Wright, released her second report on water quality. It warned that business-as-usual dairy expansion by 2020 would leave our lakes and rivers more degraded than they are now, even with improved mitigation. I’d now like to re-cap what the report concluded, how it got there, and how it was received.

The report

The purpose of the report was to illustrate how land use change could affect future nutrient runoff – nitrogen and phosphorus – based on a simple, business-as-usual scenario for 2020.

Motu used a combined economics-land use model called LURNZ to project what land use changes are likely by 2020, driven by commodity process and knowledge of land use practices and landscape characteristics. Sheep and beef farming were expected to give way to dairying, forestry, and even reversion to shrubland. . .

Director elections mean an exciting Red Meat Industry:

Federated Farmers looks forward to working with the Boards of the cooperatively owned Silver Fern Farms and Alliance Group following their recent Director elections.

“Federated Farmers congratulates the new directors elected to our two largest cooperatives, Don Morrison at Alliance Group as well as Richard Young and Dan Jex-Blake at Silver Fern Farms,” says Jeanette Maxwell, Federated Farmers Meat & Fibre chairperson.

“We also congratulate Alliance Group chairman Murray Taggart on his re-election.

“Federated Farmers Meat & Fibre wishes to formally thank Alliance Group’s Owen Poole and Jason Miller as well as Silver Fern Farms’ David Shaw for their service to shareholders. . .


100th auction proves GDT’s worth

September 20, 2013

Fonterra’s GlobalDairyTrade passed a significant milestone on Tuesday with its 100th auction.

Global Dairy Trade Director Paul Grave says the 100th successful auction marks a coming of age for the platform which is now in its fifth year of trading and surpassed US$10 billion in aggregate sales earlier this year (July 2013).

“Achieving our 100th trading event proves the success of the online model.  It shows that Global Dairy Trade has matured to become an essential feature of the global dairy industry.  GDT now provides price transparency and highly efficient purchasing for more than 850 registered bidders from 90 countries,” Mr Grave said.

“The strong support for the platform shows we are meeting a real market need to find a robust reference price that reflects true levels of supply and demand in the market,” Mr Grave says.

The platform is now used by six global companies supplying product for sale.  This includes Fonterra (New Zealand), Dairy America (USA), Amul (India), Arla (Denmark), Murray Goulburn (Australia) and Euroserum (France). A typical auction event lasting around two hours will sell enough product to completely fill a container ship; amounting to around  2,500 standard twenty-foot containers, valued at between US$100 and $250 million.

Global Dairy Trade operates at arm’s length from its owner Fonterra.  Fortnightly auctions are conducted on behalf of GDT by Boston-based, NASDAQ-listed CRA International in accordance with market rules monitored by an independent advisory board of sellers and buyers. 

“We are delighted that Global Dairy Trade is today centre-stage of a vibrant global dairy industry which is experiencing annual demand growth of well over 2.5%.  We will be seeking to continuously improve our service as technology evolves over the years ahead,” Mr Grave says.

There was concern and scepticism from within New Zealand and abroad about the on-line auction system when it was first launched but this milestone proves it’s working and shows its worth to Fonterra, its shareholders and suppliers and customers.

The company trades only a small proportion of its product through the auction but it is a useful indicator of demand and price.

It’s also used as a benchmark by other companies here and overseas.

When we were in Holland last year the latest GDT auction results featured on the front page of a farming paper.


Fonterra still #4 in global dairy

September 11, 2013

Fonterra has maintained its fourth place in Rabobanks top 20 dairy rankings.

The latest Rabobank survey of the world’s largest dairy companies (ranked by dairy product turnover1) has some familiar features. Nestlé and Danone remain at the top of the table and 18 of the 20 companies are the same as 12 months prior.
 
However,the survey also demonstrates some significant changes. The most notable shift at the top end of the table is the continued rise of Lactalis. With ongoing sales growth and the acquisition of Parmalat and Skånemejerier, Lactalis has moved from fourth into third position, and is now within striking distance of Danone. But the biggest strides up the table were made by the Chinese giants. Having entered the top 20 for the first time in 2010, Yili moved up four places into 15th and Mengniu moved up two places into 16th, riding the wave of domestic market sales growth.
 
Perhaps most striking is that despite the rise of the Chinese, the list of the world’s 20 largest dairy companies remains dominated by those based in OECD countries.
 
The headquarters for 18 of the 20 are in the EU, North America, Japan or New Zealand.
Shifting global dynamics call for strategic change:
This highlights one of the key challenges facing the world’s largest dairy companies. As outlined in Rabobank’s January 2012 report Show me the money, growth is expected to slow in these traditional dairy markets over the next five years, as the industry battles economic and demographic headwinds, already high dairy consumption levels, overweight consumers and concerns over the cost of dairy. By contrast, emerging markets such as China, South East Asia, India and Latin America are expected to offer good sales growth, with almost the opposite trends in place.
These dynamics have been developing for some time, and many of the world’s largest dairy companies have been working for years to ensure they are well placed to survive and thrive in this shifting market place. Those who are less well placed are now moving quickly to do so.
In slowing home markets, companies are building larger, leaner businesses and trying to tap into the pockets of faster growth that remain, sparking national and regional consolidation moves. At the same time, most are working hard to acquire the products, brands and competencies to build footholds in newer growth arenas.
Today, 16 of the largest 20 dairy companies have investments in manufacturing in Asia and/or Latin America; 15 of them have investments in China alone.
Companies are jostling for position
But an increased sense of urgency has entered the game of late, as the market trends accelerate and each new acquisition or merger narrows the remaining field of targets.
These strategic imperatives have generated a wave of M&A activity over the last 18 months, much of it cross border. The majority of the companies in our top-20 have bought other companies or entered joint ventures to strengthen their position during this period. The most significant moves have
included:
– Nestlé’s acquisition of Pfizer’s nutrition business, to buy improved entry into the rapidly growing infant nutrition sector in emerging markets;
– Lactalis’s acquisition of Parmalat, giving them access to several new markets around the world;
– FrieslandCampina’s acquisition of Alaska Milk in the Philippines, expanding their foothold in a fast-growing market;
– Arla’s proposed merger with Milk Link in the UK, and Milch-Union Hocheifel in Germany,consolidating their Northern European footprint;
– Canadian-based Saputo’s acquisition of the US cheese maker DCI to bolster its product portfolio in the US cheese market;
– Müller’s acquisition of Robert Wiseman Dairies in the UK and joint venture with PepsiCo in the US to tap into the expanding US yoghurt category.
Rabobank expects to see companies continue to vigorously pursue merger and acquisition targets in the next 12 months as they jostle to position themselves for growth and profit in a changing market environment.
rabodairy13

Fonterra opening second farm in China

April 4, 2012

Fonterra’s chair and chief executive Sir Henry van der Heyden and chief executive Theo Spierings will be in China next week to open the company’s second dairy farm there.

In a newsletter to shareholders they also mention that China’s imports of milk in February were 45% higher than at the same time last year. New Zealand supplied 95% of the whole milk powder and 75% of the skim milk powder.

The trade weighted price of milk increased 1.5% in this morning”s globalDairyTrade auction after three months of falling prices.

the price of anhydrous milk fat increased 8.3%; cheddar was up 13.2%; milk protein concentrate went up 13%; rennet casein was up 13.8%; skim milk powder was down .8% and the price of whole milk powder was down 2,8%.

Arla, a european co-operative, and Murray Goulburn, an Australian co-operative, sold milk in the auction for the first time. The addition of more industry players highlights the GDT’s key role in international dairy trade.

 


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