Rural round-up

08/05/2019

Chinese demand still strong – Hugh Stringleman:

China’s dairy demand is steady and the feedback from customers there is strong, Miraka chief executive Richard Wyeth says.

After talking to Chinese customers and Miraka’s sales representatives through Global Dairy Network, Wyeth doesn’t expect big commodity price increases for the season ahead but neither will there be big decreases.

“I think it will be steady as it goes, which is a nice situation to be in.”

All of Miraka’s UHT liquid milk output and about half of its milk powder volume go to China. . . 

Artist and actor riding high in a bull market – Sally Rae:

“You’re the chick who paints cows. You’re the bull painter.”

Amelia Guild gets used to hearing such comments from those familiar with her bold and bright paintings of animals, particularly cattle.

The Canterbury-based artist and actor is excited about her upcoming exhibition, “Mustering the Muscle”, which opens at The Artist’s Room Fine Art Gallery in Dunedin on May 11.

Life is busy – “on the cusp of getting chaotic” – for the mother of 4-year-old Willa and 16-month-old Rollo.

But she is also living the dream, being able to reside in her “happy place” on High Peak Station, the high country property she grew up on, inland from Windwhistle, near the Rakaia Gorge. . . 

Farmer-led group lobbying for changes to Waimakariri water plan – Emma Dangerfield:

A group of young North Canterbury farmers are challenging proposed environmental rules they say are “unachievable”.

The farmers had established the Waimakariri Next Generation Farmers Trust in response to planned changes and rules affecting farmers in the district.

They hope to collaborate with industry and local authorities to address environmental concerns, particularly relating to water quality and management issues. . . 

 

Breeders on tour – Sally Rae:

Bruce Robertson describes the fellowship of Dorset Down breeders as being like a family.

Breeders from throughout the country were in Canterbury and North Otago last week for an annual tour.

About 35 people visited studs in the Ashburton area, before heading to Aoraki-Mount Cook for a night, a visit to merino property Benmore Station, and then to Oamaru. It ended with a visit to studs in South Canterbury. . . 

IHC fundraising calf scheme is on again– Annette Scott:

The annual IHC calf and rural fundraising scheme fell short of its target last season with organisers reaching out to farmers to get on board this year.

IHC national fundraising manager Greg Millar said last year was terrible for many farmers and he hopes the scheme can bounce back this year. 

“Farmers still managed to raise $650,000 for people with intellectual disabilities and despite falling short of our $1m target it was great to see the rural community continue to support our cause,” Millar said.

The national advocacy organisation for people with intellectual disabilities has acknowledged the challenging times with the introduction of new processes as the industry grapples with Mycoplasma bovis. . . 

Helping hands needed for animal farm rescue centre in Glenhope – Carly Gooch:

Lisa Grennell did everything she could to save a piglet but when the little porker lost its battle, the decision was made – time to set up an animal farm rescue centre.

Plum Tree Farm in Glenhope, 80km south of Nelson is home to Lisa and her husband, Mal, but it’s also a sanctuary for farm animals including donkeys, alpaca, kunekune, calves, lambs and goats.

The animal farm “gradually happened”, Lisa said, after the couple moved to the 42 acres nearly four years ago.  . . 


White gold not so golden

10/09/2008

A fall in world prices for dairy products is making potential investors increasingly shy about putting their money into the sector.

With whole milk powder prices retreating significantly in the past couple of months, market participants are saying demand for rural land suitable for dairy is lessening and linking it to new production investment.

Global Dairy Network director John Shaskey said the latest price being paid for whole milk powder was about US$3000 a metric tonne, a significant retreat from recent peaks.

One set of University of Wisconsin data showed whole milk prices peaking at more than US$5800 about a year ago.

“In the last two months they’ve dropped by about US$1500 … Demand has really softened in key markets, in developing markets,” Mr Shaskey said.

There were also now expectations of “a pretty normal supply year” from Oceania markets, including Australia and New Zealand, where Fonterra was expecting about 10 per cent more production compared with last year’s drought-ravaged supply.

Mr Shaskey, whose company trades and exports on behalf of New Zealand and overseas producers, said the Kiwi dollar would need to retreat even further from its existing levels of US66c-US68c to support Fonterra’s payout plans.

Another industry insider said the price falls had created uncertainty in terms of investment in land and the development of infrastructure for processing milk. “This will have an impact on the payout price by Fonterra- the banks are talking somewhere between $5.50 and $5.80 [a kilo of milk solids].”

In spite of the encouraging propsects of increased demand and diminishing supplies, I knew that the milk payout wasn’t going to keep going up. I didn’t however, expect it to come back down so soon and so far.

The concern is that while the payout has gone up so too have costs and they won’t come down as far or as fast as returns do. That will mean taking a more conservative view on budgets for established farmers and even more serious re-budgeting for new entrants who have paid an inflated price for land based on higher returns than will now be achievable.

In May, Fonterra increased the farmer payout to a record $7.90 for the 2007-08 season, and announced an initial forecast for 2008-09 of $7 a kilo. “This is certainly affecting the economics of people who are looking to enter the dairy industry, and those who have bought land at high prices with an expectation that the high payout prices will continue,” the industry insider said.

Financial players who knew the dairy sector well and knew that demand would continue were now in a wait-and-watch mode, the insider said.

Mr Shaskey said that in the longer term there could be a significant realignment of high land prices, given retreating commodity prices and the probability of more overseas supply coming into the market.

But the creation of new processing facilities and land conversion would probably continue, given prices were above historic levels.

“People need to be cautious around their numbers, and not budget on $7 [a kilo] plus payouts … because they’re not the norm.”

Another view in the market was that a US dairy herd expansion had driven up supply but that now some of those farmers were leaving the business – a positive for New Zealand producers.

Conversion to bio-fuels has led to an increase in the costs for US dairy farms which use grain to feed their cows. It’s possible some of those farmers will find more lucrative uses for their land than dairying which will provide a gap in the market for us.

But the short term outlook isn’t nearly as good as it was and if the Emissions Trading Scheme passes its third reading then more of the shine will go off our white gold.


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