Rural round-up

01/04/2016

Nutritional Sales Underpin Half Year Underlying Profit of $12.3 Million:

Synlait has reported an underlying net profit after tax (NPAT) of $12.3 million for the first half of the 2016 financial year (HY16).

In contrast to $0.4 million in HY15, this improved performance is primarily the result of increased nutritional sales in canned infant formula.

“We’re glad to deliver a solid result for the first half of FY16. Our significant investment in customer and product development, people, plant and operating systems in recent years is beginning to transform our earnings,” said Chairman Graeme Milne. . . 

European market conditions depress Westland’s payout prediction:

Global market conditions for dairy products point to at least two more seasons of low milk payouts in New Zealand, Westland Milk Products told shareholders today as the co-operative revised its predicted payout for the 2015-16 season to $3.90 – $4.00 per kilogramme of milk solids, down from last month’s prediction of $4.00 – $4.10.

Westland CEO Rod Quin said the major driver of the revised payout remains the global oversupply of milk, compounded by the ongoing high availability and aggressive approach by the European dairy market.

Quin and Westland Chair Matt O’Regan have recently returned from Europe where they met with customers, farmers, processors, traders and industry advocates. . . 

Fonterra makes best of a bad job – Allan Barber:

The PR spin has been pretty active signalling a much improved half yearly result which was duly delivered this morning. The company confirmed a 40 cent dividend for the full year with the interim dividend being paid next month as usual and the final dividend being paid in two tranches in May and August instead of October.

This improvement in cash flow will do something, but not a lot, to comfort farmers labouring under a debt burden. Unfortunately it will do absolutely nothing to support sharemilkers who will have to rely on their share of the milk payout. Predictions for the rest of 2016 are notable for their conservatism, probably in recognition of a disappointing track record when forecasting the extent of the current downturn. . . 

Fonterra’s six-month results – good news but some underlying issues – Keith Woodford:

As expected, Fonterra has announced a greatly enhanced six-month profit for the period ending 31 January 2016. The profit of $409 million (NPAT; i.e. net profit after finance costs and tax) is up 123% from the same period in the previous year.

The expected full year profit of 45-55c per share implies an annual profit of about $800 million compared to $506 million for the full year 2014/15.

These figures are all very much in line with expectations . The reason for this is that when milk prices to farmers are low, then Fonterra has low input costs. Accordingly, there is more scope for corporate profit. . . 

Keep sharing the load by talking about it:

No matter which branch of farming you are in, you will face tough times, says Nelson farmer and Horticulture NZ President Julian Raine. When that happens, don’t be too proud to ask for help.

Speaking to the Farming Show’s Jamie Mackay as part of the Getting Through Adversity radio series, Julian said that even with the best planning, erratic weather events can cause mayhem. Jamie suggested that growing fruit crops is arguably one of the riskiest pursuits in farming: “One adverse event at the wrong time and suddenly your whole crop is wiped out. If you are a sheep farmer, for example, you at least have lambing spread over three weeks, or if you are dairy your risk is spread over nine months of milking.” . . 

Meat exporters ready to reap benefits of TPP:

The Trans-Pacific Partnership (TPP) agreement eliminates all tariffs on beef into our biggest market, the United States, within five years of coming into force.

Trade Minister Todd McClay, speaking at the Canterbury Employers Chamber of Commerce this morning, says New Zealand exported meat products worth over $2.8 billion to TPP countries in 2015 and the gains once TPP comes into force will be significant.

“Our beef into Japan currently attracts a 38.5 per cent tariff. That has made it extraordinarily hard for our exporters to compete with other countries with lower tariffs. . . 

Ongoing market challenges weigh on New Zealand farmers, with confidence close to 10-year low:

The significant and persisting challenges in market conditions continue to weigh heavily on the nation’s farmers, with New Zealand’s rural confidence at the second lowest level recorded in the past 10 years, the latest Rabobank Rural Confidence Survey has shown.

Completed earlier this month, the survey found more than half of farmers surveyed (53 per cent) had a pessimistic outlook on the agricultural economy over the coming 12 months. This was significantly up from 30 per cent with that view in the previous survey, in late 2015. . . 

Dairy downturn: councils prepare to tighten belts:

Councils in rural areas might be forced to cut spending if the dairy downturn lasts for a long time, Local Government New Zealand head Lawrence Yule says.

A Westpac-McDermott Miller regional economic survey has shown big falls in confidence in major dairy areas including Waikato, Taranaki, and Southland.

Mr Yule said the businesses in many rural towns were already hunkering down as farmers tightened their spending, and that could spread. . .

NZX to teach farmers about new milk contract:

NZX expects to receive regulatory approval for the new fresh milk futures and options product within two weeks.

Chief executive Tim Bennett said there was a demand for the fresh milk contracts product after Fonterra scrapped its guaranteed milk price product for the upcoming season. . . 

NZ helping to restore Fiji’s dairy sector after Winston:

The New Zealand government says it will help restore Fiji’s dairy industry which is losing thousands of litres of milk and was devastated as a result of last month’s cyclone.

New Zealand announced additional aid to help Fiji’s recovery on Wednesday.

A lot of that money is going into the continuing infrastructure rebuild led by the New Zealand Defence Force. . . 

Helensville Farmers First To Claim Supreme Title In Auckland Ballance Farm Environment Awards:

“Environmental champions” Richard and Dianne Kidd are Supreme winners of the inaugural Auckland Ballance Farm Environment Awards.

At a special Ballance Farm Environment Awards (BFEA) ceremony on March 30 (2016), the Helensville couple was also presented with the Beef + Lamb New Zealand Livestock Award and the Farm Stewardship Award in partnership with QEII National Trust and New Zealand Farm Environment Trust.

BFEA judges described Whenuanui Farm, the Kidd family’s 376ha sheep, beef and forestry unit, as “a show piece farm on the edge of Auckland city”. . . .

From paddock to packet: The family behind NZ’s most successful independent chips – Ryan Bridge:

You’re about to meet a family of potato farmers who beat the odds to grow one of the country’s most successful independent chip businesses.

The Bowans are from Timaru and not only do they grow spuds, they transport them to their own factory and make the chips too.

Together they are Heartland Potato Chips.

It all started when Raymond Bowan decided to grow his own potatoes as a teenager. His son James Bowan has taken over running the family potato farm and unlike his old man, he doesn’t do it by hand anymore, there’s a flash piece of kit to help. . . 

Food development facility opportunity for creative entrepreneurs:

Those looking to be innovative with their food are wanted at the FoodSouth food development pilot plant on the Lincoln campus, but there are no Heston Blumenthal creations on the menu.

The final part of a national food innovation network, the facility provides three purpose-built independent food safe development spaces along with a variety of processing equipment — an extruder, ovens, dryers, enrober, mixers, and a mobile product development kitchen among them.

It enables businesses to develop product prototypes for market validation, trial new equipment, carry out scale-up trial work and sample manufacture in 20L to 200L batch sizes, conduct process development and improvement, and validate quality systems. . . 

It’s in the family for new A&P Association President:

Sheep and beef farmer Warrick James has been elected as President of the Canterbury Agricultural and Pastoral Association for 2016 at the Annual General Meeting at Riccarton Park Racecourse on 30 March.

Based in Central Canterbury near Glentunnel, Mr James was confirmed as President of the 154th Canterbury A&P Show in front of outgoing President Nicky Hutchinson and Association Members.

“It means a lot to be President of the Canterbury A&P Association. We host the largest and most prestigious Show in the country – it really is the pinnacle of the A&P movement. Having been involved from a young age with my family and seeing my own children take part over the years just makes this even more special.” . . .

Trio spread cheer on woolshed tour – Suzette Howe:

At a time when life’s a bit tough for rural communities, a trio of Kiwi performers are setting off on a woolshed tour to boost morale. 

They’re coming armed with their own stage curtain, a bar and plenty of laughs.

Over the next five weeks the talented ladies will transform more than 20 working wool sheds into live stages the length of the South Island.

They’re travelling by horse truck, carting hundreds of chairs, a bar, and full production set.

Farmer Georgie Harper says it’s hard to say no when the performance is brought to you. . . 

Itinerary and booking information at The Woolshed Tour.


Losing licence to farm

28/09/2015

One of Australia’s top farmers is in danger of losing his licence to farm:

David Blackmore’s wagyu beef is on the menu at some of the world’s most famous restaurants. The Victorian farmer counts US chefs Thomas Keller and Wolfgang Puck, England’s Heston Blumenthal, and locally, Rockpool’s Neil Perry among his fans.

The heavily-marbled beef, from the famed Japanese kobe beef bloodstock, can fetch up to $150kg at gourmet butchers.

The 5th generation farmer is a poster boy for Australian produce, featuring in Tourism Australia’s campaign to attract food lovers to visit the country. Chef Martin Benn from three-hat Sydney restaurant Sepia recently took Blackmore’s wagyu to New York as part of a showcase of Australian food.

There’s a steady trail of documentary film makers through his farm in Alexandra, 150km from Melbourne.

On Monday, Blackmore, 65, received yet another award for his beef at the Sydney Opera House. He was the 2012 livestock producer of the year.

But now he looks set to lose the Victorian farm where he’s been raising cattle for the last 11 years after a neighbour complained to the local council, saying, among other things, the farm attracted too many noisy cockatoos.

Last month, a majority of councillors ignored the advice of planning staff who recommended the Blackmore’s business continue, albeit under strict new guidelines, including a bird management plan, voting 4-2 against the continued use of the farm to raise the prized cattle.

The decision has alarmed farming community and chefs such as Neil Perry, who’ve started a petition backing Blackmore and calling on the Victorian government to intervene.

The Victorian Farmers Federation (VFF) labelled Murrindindi Shire Council’s decision “absurd”, with the potential to “undermine the prosperity and future of agriculture in this state”.

VFF president Peter Tuohey said his organisation was worried that councils like this would use planning laws to stifle the growth of Victorian agriculture in rural areas.

“The fact is David Blackmore and his family were willing to comply with a raft of 20 permit conditions – from maintaining paddock cover to bird management,” Tuohey said. “Yet the councillors rejected the permit on the basis of three brief dot points that had already been addressed under the permit conditions.

“This is a roadblock to one of Australia’s most innovative livestock pioneering families.”

The 20-page planning report prepared by council staff was referred to several state government authorities, including the EPA, who all backed approving the continued use of the site to raise cattle.

While the VFF believe the Blackmores have a strong case to overturn the decision on appeal, David Blackmore told Business Insider he may look at selling up, and two other councils have already been in touch offering him incentives to relocate to their regions.

The Blackmore’s farm contributes an estimated $3 million annually to Murrindindi’s local economy and another $3m to the Victorian economy. It employs 10 people, along with Blackmore and his wife, Julie. Their beef is exported to 20 countries.

The planning dispute is over the intensity of the farming. Neighbours complained about noise and odours. Council is concerned about the environmental impact on the landscape.

Blackmore runs 1350 head of cattle on the 150 hectares, grain feeding them to create the distinctive marbling that’s the hallmark of wagyu beef.

He bought the farm in 2004 and says his stocking levels are lower than they were in 2001 under the previous owners.

“It’s been a feeding farm since 1998 and we did a lot due diligence before we bought it,” he said. “Everyone said we didn’t need a license.”

But Murrindindi council took a different view following the complaints. Blackmore says the problem was deciding what sort of permit was needed. Some argued it was a feedlot, but eventually it was designated as “intensive animal husbandry” and a permit was required.

Everyone signed off on it until it got to council. Blackmore has until the end of August to decide what his next step is. . . . 

We visited this farm a couple of years ago and were very impressed with what we saw and heard.

Blackmore has spent years and large sums of money in research, breeding, improving the farm, and developing and maintaining markets. His office wall was lined with awards and media clippings praising what he’d achieved on farm for animal welfare and environmental practices, and in the market.

Chef Neil Perry is furious. He’s been using Blackmore’s beef in all his restaurants since opening Rockpool Bar & Grill in Melbourne in 2006. The chef has started an online petition, appealing to Victorian premier Daniel Andrews and the agriculture minister to intervene so the Blackmores can continue to farm there.

“The council are saying this is all about intensive factory farming. I can tell you it’s not,” Perry told Business Insider.

“It’s just really ridiculous what they’re trying to say. There is no more ethical, sustainable farm in Australia and he’s a world benchmark for what ethical, sustainable farming is.

“This is what great farming is all about. It’s a beautiful and we should be proud of it.”

The chef has taken numerous other chefs to see the farm and laughs at the complaints about birds.

“Every time I’ve visited over the last 10 years there’s been cockatoos everywhere around the region,” he said. “How can they all be David’s fault?”

Blackmore says he put a lot of work into restoring the landscape on the farm over the last decade. The recommended permit, which council knocked back, demanded even more, but the farmer says he was already doing the work because “it was a good idea for animal welfare and economically as well”.

He cites the fact that the cattle put on 20% more average daily weight gain than they did in feedlot as proof that his farming methods work

“It’s because the cattle are happier,” Blackmore says. “We’re really open about what we do. It’s not as though we’re trying to put anything over anyone.” . . 

There is cold-comfort in the words of Shire mayor, Margaret Rae:

“It’s been disheartening to see that the message being portrayed is that Murrindindi Shire Council is ‘shutting down’ the Blackmore farming operation and that the owners are being ‘kicked out’. This is absolutely not the case,” the mayor said.

“Council’s refusal of this particular application does not prohibit Mr Blackmore from continuing to farm his land the way he was prior to choosing to intensify his program through intensive animal husbandry practices, which triggered the requirement to apply for a planning permit and also prompted concerns from neighbouring properties.”

Mayor Rae was one of the councillors who voted in favour of Blackmore being granted the permit he was denied. Her statement makes no mention of the fact that the vote ignored the advice of planning staff who recommended the beef farming business continue at its current level, albeit under strict new guidelines. . . 

Returning to how he used to farm would put an end to the business.

This is happening in Australia but it could easily happen here.

Meadow Mushrooms in Hawkes Bay, which has been operating for decades, is facing problems since a new residential subdivision was located near by.

The difficulty of maintaining the licence to farm will increase as urban sprawl,  lifetyle blocks and the imbalance in numbers and power between city and country continue to grow.


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