Dairy following failed example of meat industry

March 14, 2018

Have we reached peak dairy factory?

The number of dairy factories sprouting in Waikato has got to the stage that farmers are concerned the industry has reached a tipping point.

They fear further growth could lead to overcapacity – too many milk processing sites – and dairying will follow the path of the meat industry, which over the past decade has been plagued by plant closures and job losses. . .

Fonterra Shareholder’s Council chairman and Waikato farmer Duncan Coull​ says it is becoming a national issue for the industry. It is bigger than Fonterra and an industry-wide discussion is needed to find a way to save it from itself.

“Do farmers really want to reach that tipping point because once that tipping point is reached, there is no turning back. We need to start asking ourselves the question as farmers what we want the industry to look like going forward.

“If farmers continue to allow capacity to be built and continued to supply that capacity, be very careful what we wish for, we are another red meat sector waiting to happen and we are another Australian dairy industry waiting to happen.” . . 

Farmers like some competition but it the meat industry found out at great cost – in money and human terms – that it is possible to have too much competition.

Synlait chief executive John Penno​ says the dairy industry is already at overcapacity and the vast bulk of the processing technology built in recent years has been large-scale milk powder plants producing dairy commodities.

“There’s no question in my mind that overcapacity across the industry exists. But the real question is, is it the right capacity? What is the total capacity is the wrong question.”

Synlait does not operate in that market and builds plants focusing on high-end, value-added products. . ..

Farmers are free to choose which company they supply.

A new one might look attractive, especially if it doesn’t require suppliers to buy shares.

But the lesson from the meat industry is that more competition isn’t always better for farmers or the industry.


Rural round-up

September 19, 2017

Guiney misses out on selection – Hugh Stringleman:

One long-serving director and two newcomers are the preferred candidates for three Fonterra board seats this year leaving sitting board member Leonie Guiney out in the cold.

They were former Fonterra Shareholders Council chairman and nine-year director John Monaghan, of Wairarapa, former Deer Industry New Zealand chairman and farm consultant Andy Macfarlane of Mid-Canterbury and PWC partner and National Fieldays Society board member Brent Goldsack, of Waikato.

The three were named as independent nomination process candidates for three vacancies among seven farmer-director seats on the Fonterra board. . .

Palmerston North farmer Peter Bills owns more machines than most – Samantha Tennent:

Not many contractors or services agents come through the gate of Te Rata Farm at Linton, owned by Peter and Kim Bills. The Bills try to be as self-sufficient as possible across their business.

The Bills run a pretty taut ship, keeping costs down by doing all their own cultivation, mowing and bailing. They admit they own more gear than the average 260-cow farm; almost the only piece of equipment they don’t have is a harvester.

“It keeps costs down for us but more importantly we aren’t relying on a contractor to get the work done. . .

Weather hits somber pea growers – Annette Scott:

There’s been no compensation for Wairarapa pea growers heading into their second season of a two-year pea moratorium.

And on top of wet weather that meant they could not get crops in the ground put farmers in a pretty sombre mood, Wairarapa cropping farmer Karen Williams said.

Williams, the 2017 Biosecurity Farmer of the Year, was an integral part of the grower group working alongside farmers and the Ministry for Primary Industries in the pea weevil response. . .

Restrictions lifted on feijoas in Taranaki after being cleared of myrtle rust threat – Gerald Piddock:

Feijoa lovers can breathe a sigh of relief after ministry officials put the plant in the low risk category for infection from myrtle rust.

Growers will also be relieved after the Ministry for Primary Industries lifted restrictions for moving feijoa plants in and out of Taranaki after it concluded there was little risk of them spreading myrtle rust.

Since myrtle rust was found in New Zealand earlier this year, there had not been a single feijoa plant found with the infection, the New Zealand Plant Producers Incorporated said in a statement. . .

From milk to medicine with DFE Pharma – a farmer’s journey from Taranaki to Europe:

Under the mountain in Kapuni, Taranaki, our farmers’ milk is being made into something pretty remarkable.

Our Kapuni site focuses on producing pharmaceutical lactose, a key ingredient in inhalers helping people around the world manage their asthma.

The lactose we make at Kapuni is the most pure lactose you can make in the world. And in short, gets the medicine in powder inhalers to where it’s needed – the lungs. . . 

Rural round-up

September 8, 2017

 Auckland-based designer re-invents lamb docking tool named national winner of James Dyson Award:

A re-designed lamb docking or tailing iron has won the New Zealand leg of the prestigious James Dyson Award for design engineers.

Many sheep farmers can experience repetitive strain injuries from using traditional tools during the seasonal process of removing lambs’ tails, commonly known as docking. And it’s not just the farmers who have been suffering; fluctuations in blade temperatures can cause considerable pain for the lambs, often leading to ineffective cauterisation and stock mortality.

Auckland-based industrial designer Nicole Austin has helped solve these problems by inventing Moray, an innovative hand-tool designed to help improve usability, performance and stock wellbeing. . . 

“Black gold’: vanilla prices reach record highs – Alexa Cook:

A global shortage of vanilla has sent prices sky high, and the cost of vanilla is now more than double previous record prices. 

The last peak was in 2003 when it reached $US300 per kg, and it is now sitting about $US700 per kg.

Vanilla is a tricky product to grow: the flowers only open once a year and have to be hand pollinated within four hours of opening.

Heilala Vanilla chief executive and co-founder Jennifer Boggiss said vanilla, as a commodity, went through cycles, and at the moment it had record high pricing and short supply. . . 

Great Short and Great Day Walks announced:

Some of New Zealand’s finest tracks are set to become part of a new network of Great Short and Great Day walks, Tourism Minister Paula Bennett and Conservation Minister Maggie Barry have announced.

“We’re bringing new facilities and a new, higher profile to some of the best walking experiences New Zealand has to offer as part of Budget 2017’s $76m investment in DOC’s infrastructure,” Mrs Bennett says.

The Great Day and Great Short Walks, developed by DOC in partnership with Tourism New Zealand, are an expansion of the highly successful Great Walks brand aimed at promoting more of the fantastic walking experiences available across the country. . . 

Nominations for Fonterra Shareholders’ Council And Directors’ Remuneration Committee Open Today;

Nominations opened today for the 2017 Fonterra Shareholders’ Council and Directors’ Remuneration Committee Elections.

Following last year’s Governance and Representation Review undertaken by Fonterra, the Shareholders’ Council has given effect to the recommendation voted on by shareholders in late 2016 that: “Over the next 12 months, the number of Shareholders’ Council wards is reviewed to establish how they can be reduced within the range that is permitted under the current Constitution.” . . 

Substantial dairy farm and runoff block placed on the market for sale:

A substantial dairy farm and associated run-off block in South Canterbury – including approximately 1,100 cows plus young stock – has been placed on the market for sale as a going concern.

The properties are located under the rain shadow of the Hunter Hills and feature a 501.944 hectare dairy platform located at 3150 Back Line Road at Kohika plus a 119.9636 hectare self-contained run-off located at 316 Campbell Forrest Road, which is only four kilometres from the dairy platform on a quiet country road. . . 


Rural round-up

September 22, 2016

The P epidemic has reached Waikato farms – Chris Lewis:

Federated Farmers runs an 0800 helpline for members, which is a popular way our members get value out of their subscriptions. Increasingly we are getting member calls around drugs and alcohol and advice on how to address this growing issue.

We’ve previously provided advice to farmers who have had multiple houses contaminated with P and even advice to a farmer for an entire workforce that tested positive for drugs. Some of the common questions being asked include: If I don’t have a drug and alcohol policy, how do I go about testing my staff? And, am I insured for my houses and business?

So what are our rights as employers? Should you turn a blind eye so your cows get milked? It is time to directly answer some of the questions, and for you to get answers from experts who work in this field. . . 

SFF ‘unleashed’ by assent – Dene Mackenzie:

Silver Fern Farms would be a ”company unleashed” now approval for Shanghai Maling to buy 50% of the Dunedin meat processor had been confirmed, SFF chairman Rob Hewett said yesterday.

After months of debate and some opposition from dissenting shareholders, Shanghai Maling received approval yesterday to inject $261million into SFF and take a 50% share.

The decision was never in doubt, although the Overseas Investment Office process was a ”black box”, Mr Hewett said in an interview. . . 

Govt defends Wairarapa water grant:

A Wairarapa irrigation system which didn’t stack up economically still got taxpayer cash from the Ministry for Primary Industries, says a damning study commissioned by Fish & Game.

But MPI is standing by its decision and says the report is flawed.

Fish & Game has released an independent analysis of the Wairarapa Water scheme’s successful application for $821,500 from MPI’s Irrigation Acceleration Fund for stage 2 of the scheme, which aims to irrigate 30,000ha.

The 2014 application was based on a long run farmgate milk price of $7.07 per kg of milksolids, which was questionable, and that 55 percent of the irrigated land would quickly be converted to dairy, says author Peter Fraser, of Ropere Consulting. . . 

Strong 2015/16 Profit Result for Fonterra, Encouraging Milk Price Signals Ahead for Fonterra Farmers

Fonterra Shareholders’ Council Chairman, Duncan Coull, said Fonterra’s recording of its highest ever EBIT, which resulted in Fonterra Farmers receiving a 60% increase on the earning per share received last season, was a positive result in an otherwise challenging environment.

Mr Coull: “The final payout of $4.30 for a fully shared-up Farmer is reflective of the very tough season we have endured.

“However, it is encouraging to see that Fonterra, assisted by the low Milk Price environment, has further driven volume into value and captured efficiency gains which have cumulated into a strong dividend while also serving to strengthen our Co-operative’s balance sheet. . .

Self-resetting rat traps 20 times better than standard traps -study:

Self-resetting rat traps are 20 times more effective at killing the pests than standard traps, a new study has shown.

The project – conducted by Bay of Plenty Polytechnic student Chantal Lillas – compared the amount of rats killed by self-resetting traps over a 10-day period last month, compared to the single-action traps more commonly used.

The self resetting traps were developed by the company Goodnature in collaboration with the Department to Conservation, and could reset up to 24 times before it needed to be reloaded. . . 

Zespri Board announces succession planning for new CEO:

The Board of Directors of Zespri will start a search process next year to select a new Chief Executive Officer. The succession is being planned with a view to having the new CEO in place by the beginning of 2018.

The current CEO Lain Jager, who was appointed Zespri CEO in December 2008, will remain in the role until the new CEO starts.

Zespri Chairman Peter McBride says the Board is balancing continuity and renewal in the leadership of the organisation. “The Zespri Board has set out a process for succession at an optimal time. The timeframe helps to ensure continuity through this transition, which is important given Zespri’s critical role in the value chain for kiwifruit growers and customers globally.” . . 

NZ Merino lifts annual profit 19%, meets growth targets – Tina Morrison:

Sept. 21 (BusinessDesk) – New Zealand Merino Co, a wool marketer that aims to develop higher-value markets for sheep products, posted a 19 percent lift in annual profit and said its business has doubled in value over the past three years.

Profit rose to $2.7 million in the year ended June 30, from $2.3 million a year earlier, according to the Christchurch-based company’s 2016 annual report. Revenue rose 4.9 percent to $114.7 million, while cost of sales gained 5.7 percent to $104 million. It will pay its more than 500 growers a total dividend of $1.36 million, up from $1.1 million the previous year and in line with its policy of returning 50 percent of profit to shareholders. . . 

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Don’t complain about a farmer with your mouth full.


Rural round-up

August 10, 2016

Dairy downturn has a $1.3b impact on Waikato/Bay of Plenty farmers – Gerald Piddock:

The dairy slump has ripped more than a billion out of Waikato and Bay of Plenty farmers’ pockets, new figures show.

Farm consultancy group AgFirst’s 2016 Financial Survey shows the average dairy farmer’s net cash income was down $273,000 last season.

When multiplied by the region’s 4800 dairy farms, that’s $1.3b in lost income.

The big question was how much longer farmers could maintain the current situation where they had drastically reduced expenditure, AgFirst consultant Phil Journeaux said. . . 

Wintry blast hits farmers hard – Matt Shand:

The milking shed has frozen shut at Taharua Valley Farm as 200 dairy cows huddle together waiting for the problem to be fixed.

At 783 metres above sea level, the 2000-cow PenXing Group Milk New Zealand farm is one of the hardest hit by the recent snowstorm. Just over 100 metres lower in Taupo, the snow was a fun novelty. But here it is causing serious challenges. 

There is no such thing as time off for farmers and farmhands. Hot water and heaters are used to help thaw the shed out so it can hopefully milk animals tonight.  . . 

The snow has come again – Keith Woodford:

Every year we all talk about the weather and how fickle it is.  This year is no different. In most parts of the country, June and July were unseasonably warm.  Where I am in Canterbury, winter grass growth has possibly been higher than ever before.  Grass covers at the start of August were excellent.

In contrast, last year was one of the coldest winters on record, with many South Island farms getting no net growth in June and July.   That year, there was a string of southerlies, whereas this year warm winds were blowing over the Alps. . . 

MPI investigators target alleged unregulated meat sales:

A team of Ministry for Primary Industries investigators today executed a search warrant at an alleged unregulated meat premises in Turangi.

This was the culmination of a six month undercover operation involving the purchase of considerable quantities of venison, lamb and pork products from a local Turangi man.

The man is now being spoken to by MPI investigators in relation to the alleged sale of meat from an unregulated premises.

MPI Compliance Operations Manager, Gary Orr, says a decision will be made shortly as to whether charges will be laid under the Animal Products Act. . . 

Profit jumps for New Zealand’s leading fresh produce exporter :

Turners & Growers Global has posted an 89 percent gain in first-half profit driven by sales from new and existing businesses and a one-time gain from the sale of its crate hire unit.

The fruit marketer is controlled by Germany’s BayWa but is Auckland based. Their product base includes apples, pears, mandarins, coconuts and kiwifruit.

T&G profit rose to $22.7 million, or 18.2 cents a share in the six months ended June 30, from $12m, or 9.8 cents, a year earlier. Sales rose 14 percent to $423m. . . 

Fonterra Shareholders’ Council to get clearer mandate – Paul McBeth

(BusinessDesk) – The Fonterra Shareholders’ Council, which represents farmer interests in the world’s biggest dairy exporter, is poised for a refreshed mandate with clearer guidelines on how it interacts with the milk processor.

The council and Fonterra Cooperative Group are seeking feedback from farmers on a series of proposals to update the group’s governance to make the council’s role clearer, explain how it works with Fonterra’s board and management, and improve communication with farmer shareholders. Farmers are expected to vote on any changes to the council’s governance at a special meeting in mid-October. . . 

One of the worlds’ most respected wine consultants appointed to NZ’s boutique vineyard Chateau Waimarama:

After an extensive international search, award winning boutique vineyard Chateau Waimarama, has lured leading Bordeaux wine consultant Ludwig Vanneron half way across the world to be its wine specialist.

Ludwig Vannerons’ stellar career has seen him work in prestigious and major wine areas of Bordeaux, managing the winemaking process in estates from small chateau Bordeaux appellation properties to great classified growths. . . 


Rural round-up

April 21, 2016

Farmers’ urged to make their voices heard at local elections:

With local authority elections less than six months away, Federated Farmers is urging farmers to get engaged and involved.

Federated Farmers spokesperson on local government, Katie Milne, says local government elections is vitally important for farming on many levels, and is encouraging farmers to make their voices heard.

“It is absolutely crucial that farmers get involved in holding their councils to account. This includes being engaged on the issues and when the time comes make an informed vote.

“It’s also important that we get good candidates, including farmers and other business-minded people, to stand for election,” she says. . . 

New UHT milk plant for Canterbury:

The official opening of Westland Milk Products’ new UHT plant in Rolleston is a significant boost for the Canterbury dairy industry and is a sign of the continuing shift to value-added products, says Food Safety Minister Jo Goodhew. 

“It is important to celebrate good news stories such as this new UHT facility, which combined with the strong medium to long-term outlook for the sector, gives dairy farmers confidence that the period of low prices they are currently experiencing is only temporary,” Mrs Goodhew says.

The new plant can process 14,000 litres of milk per hour and has been constructed by Westland Milk Products, New Zealand’s second biggest dairy cooperative and third biggest dairy company overall. . . 

A2 Milk’s push into China bolstered by results of human clinical trial in that country – Fiona Rotherham:

(BusinessDesk) – Specialty milk marketer A2 Milk has bolstered its push to sell more products in China through a recently completed human clinical trial comparing the gastrointestinal and cognitive effects of consuming milk containing the A1 beta casein with that of the A2 variant on people with self-reported lactose intolerance.

The results of the Chinese study were published this month in the Nutrition Journal and are due to be released at a Beijing press conference late tomorrow by the company.

It’s part of a bid by A2 to get more credible scientific validation of its marketing claims, that have been in contention since the late 1990s, that its products might be better for people intolerant to standard cow milk. . . 

Protect our most precious and vulnerable waterways first, says Environment Commissioner:

The Parliamentary Commissioner for the Environment has welcomed the Government’s latest discussion document on water quality, but has called for councils to give priority to the most precious and vulnerable rivers and lakes.

“Water quality has been declining for years and significant improvements will take time,” says Dr Wright. “Not everything can be done quickly, so regional councils must focus on immediate problems and pressure points.”

Dr Wright today released her advice to Parliament in response to the ‘Next steps for fresh water’ consultation document.

In her submission, Dr Wright states that the Government has made significant progress and has called for councils and communities to follow through and make the policy work. . . 

Farming 9 til 5: The farmers putting people before production – Jendy Harper:

On one farm near Waimate, the mantra “people before production” underpins employment decisions.

On Cara Gregan’s farm, workers must pass what she calls the “gumboot test”. 

Cara says she asks herself whether if her children or husband were wearing the gumboots, how she would feel about their conditions of work.

“I’ve got teenaged children, and I wouldn’t be prepared for them to work 12-14 hour days.” . . 

PGG Wrightson seed site hit by Uruguay flooding – Edwin Mitson:

(BusinessDesk) – Agricultural products and services company PGG Wrightson has warned investors that its seed cleaning site in Uruguay has fallen victim to that country’s widespread flooding.

The company told shareholders in February that its South American business was expected to perform better between January and June. In a statement to the NZX today, chief executive Mark Dewdney said that was no longer anticipated.

“The strength of beef prices gave us reason to believe we would see a recovery in our Uruguayan business at the full year, he said. “While it remains too soon to quantify the full impact of the current flooding, we are now not expecting to see that full recovery in the current financial year”. . . 

Tonnellerie de Mercurey NZ Young Winemaker 2016:

Blending knowledge, skill and passion for New Zealand’s premium winemaking future

Entries are now open for 2016. Who will take out the title this year?

This exciting competition for NZ winemakers under 30 years old was held for the first time last year and proved to be a challenging yet fun and very rewarding competition. Contestants felt it increased their winemaking skills, knowledge and confidence as well as building important contacts for their future careers. . . 

Greg Mccracken New Shareholders’ Councillor for Southern Northland:

Today, following the close of voting in the Shareholders’ Council by-election in Southern Northland, Greg McCracken was announced as the successful candidate.

Mr McCracken, who has been farming in the Northland region for more than 30 years and currently farms at Wellsford, will take up his new role effective immediately. . . 


Rural round-up

January 28, 2016

Rural to benefit:

Rural fire chief Mike Grant hopes the intentions outlined in Fire Service reform documents become reality.  

Grant, the principal rural fire officer for the Southern Rural Fire Authority, said much of the detail was unknown because it had still to be discussed by Cabinet but there was a consistent message on how the new management entity should operate in the review document, submissions and analysis. . . 

Dairy farming best choice for Dairy Woman Network local co-convenor

Matamata sharemilker Suzie van Heuven could not imagine going back to working in town.

The Dairy Woman Network (DWN) co-convenor for the East Waikato group is hooked on dairy farming.

That might not be surprising seeing she grew up on a farm in Waitoa except for the fact that her high school career ambition was to be a vet or a cop.

But while waiting to be old enough to apply for the police force she dabbled in the dairy industry and by 2011, had progressed to farm manager. During that time she was involved in the Ngarua Young Farmers club, where she met her future husband, Alex. . . 

Despite Expected Milk Price Correction, 45 Cent Drop is a Sobering Blow to Farmers:

Fonterra Shareholders’ Council Chairman, Duncan Coull, said that today’s announcement of a 45 cent drop in the 2015/16 forecast F from $4.60 kg/MS to $4.15 kg/MS, is one that will further amplify the effects of the current low milk price environment on Farmers and their businesses.

Duncan Coull: “Farmers are very aware that this is a global story which is now having a significant local effect. Strong supply out of Europe coupled with flat demand is driving market sentiment as evidenced by the GDT results. . .

More moo woo – Alison Campbell:

Once I started paying attention to the woo around milk I realised how much of it there is. And how ready people are to accept it.

I’ve written about the notoriously non-scientific Food Babe before. Someone with a high pain threshold could probably manage a daily blog post on this young woman and the way she manipulates opinion, and sometimes sells the very things she inveighs against… But I digress!

Today I noticed she’s shared a link about how drinking milk encourages the development of osteoporosis. I was mildly suspicious about the source (‘healthy-holistic-living.com) but before taking a look, I skimmed the comments. Oh dear. . . 

New Science Challenge to boost land productivity and the environment:

Science and Innovation Minister Steven Joyce today launched the Our Land and Water National Science Challenge, which aims to enhance primary sector production and productivity while maintaining and improving land and water quality.

The National Science Challenges are dedicated to breaking new ground in areas of science that are crucial to New Zealand’s future.

“From an economic standpoint they don’t come much more important than this,” Mr Joyce says.  “There is increasing confidence that new agricultural tools will be able achieve both these crucial objectives for New Zealand.  The job of this challenge is to use science to accelerate the development of these tools.” . . 

Welfare of horses and donkeys the focus of a new code:

New minimum standards and best practice guidelines for the management of domestic horses and donkeys have been developed in a new code of welfare.

The new code comes into effect on Thursday (28 January 2016) and includes standards for equine management, food and water requirements, handling, training and equipment, husbandry practices and equine health.

The code has been developed by the National Animal Welfare Advisory Committee (NAWAC) and applies to horses, ponies and donkeys and their hybrids kept for any purpose including those kept as companions (pets), for breeding, sport, entertainment or as working animals. The code also applies to foals and any horse captured from the wild. . . .

Retiring Farmers Urged to Consider All Options Before Selling Up:

With succession front of mind for New Zealand agriculture, a North Island sheep and beef farmer turned agribusiness advisor is encouraging farm owners to explore all of the options before settling on a succession plan.

Sean Bennett, a veteran of 20 years on the land prior to becoming an agribusiness advisor for Crowe Horwath, suggests that succession is one of the industry’s biggest challenges over the next decade.

“When you consider the average age of a New Zealand farm owner is marching steadily towards 60, and the forecast capital required to replace their exit has been estimated at over NZ$60 billion, it’s easy to see why there are widely held concerns,” says Bennett. . . 

Soaring Start to Karaka Select Sale:

After just one day of trade at the three-day Karaka 2016 Select Sale the aggregate is already over half of the final aggregate of last year’s Sale, thanks to spirited competition at all levels of the market.

The momentum from the prosperous Premier Sale flowed through to the first day of the Select Sale with the aggregate, average, median and clearance rate tracking higher than Day One of the Sale last year, with two days of the Sale remaining. . . 


American Cattlemen's photo.


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