Rural round-up

22/11/2022

Dairy producers gain fresh momentum so how sensible is it to impose a new levy on them – Point of Order?

After a slow start to the season, the NZ dairy industry has perked up,as at  the latest Fonterra  GDT auction prices firmed, after three successive falls.

That rise came on the heel of reports NZ dairy earnings from Australia have ballooned because processors there are short of milk and lining up to buy NZ dairy products.

Open Country Dairy, NZ’s second-biggest dairy processor and exporter, said it has had a 40% lift in demand for product from its Australian customers. South Island-based Westland Milk Products said it had been turning away approaches from across the Tasman.

Industry leader Fonterra, one of the world’s biggest dairy companies, said it was continuing to see strong demand from Australia. Fonterra had earlier earmarked for sale a stake in its Australian business,but only  last month announced it was not going ahead with that,a decision on which the board will be  congratulating itself. . . 

Alliance Group casts net for 400 seasonal workers – Luisa Girao:

The Alliance Group will look to the North Island and beyond to bring in 400 seasonal workers to cope with its employee shortfall.

Some of the imported staff may live on site due to the Southland accommodation squeeze.

Alliance manufacturing general manager Willie Wiese confirmed yesterday the company was recruiting up to 400 seasonal staff from across the country as well as from overseas for its Lorneville and Mataura plants.

They would help make up the shortfall in numbers Alliance could not recruit locally in Southland, he said. . . 

 

Agri commodity markets research outlook 2023: tightening the belt – Rabobank:

Agricultural commodities reached record nominal prices in May 2022, on the back of adverse weather, falling stockpiles, the war in Ukraine, the container shortage and various protectionist measures restricting food commodity exports. Between May and October, prices dropped 18% due to the USD strength, weak demand, a better container shipping situation, the temporary establishment of the Black Sea grain corridor and select bumper harvests. Presently, there are growing expectations for Brazil’s upcoming harvests of soy, sugar and coffee, as La Niña wanes and the wet season there has begun in a timely manner. Still, prices of agricultural commodities remain high, at about 50% higher than pre-pandemic levels, which is when we last saw some sense of ‘normalcy’ in agricultural markets.

Report summary

High prices would normally stimulate supply, but production is currently relatively inelastic to prices: area availability is limited as swaths of very fertile land are lost in Ukraine, farm input costs are high, La Niña is active and the cost of finance has increased. So there is more pressure on demand to balance the equation. Here we start to see some weakness that might continue through much of 2023. Global inflation has resulted in a loss of purchasing power globally, and subsequent hikes in interest rates could result in some major economies going into recession. A global recession would limit demand on a number of fronts, from feed and energy-related commodities to non-essential commodities like cotton, coffee and cocoa. . . .

Fonterra announces divestment of Chile business :

Fonterra is pleased to announce the divestment of its Chilean Soprole business. The divestment comprises a number of transactions that result in aggregate consideration of 591.07 billion Chilean Pesos (approximately NZD1.055 billion).

Fonterra CEO, Miles Hurrell, says that the divestment process for the Soprole business formally commenced in April 2022, following the launch of Fonterra’s strategy to 2030.

“A key pillar of our strategy is to focus on New Zealand milk. Soprole is a very good business but does not rely on New Zealand milk or expertise. We are now at the end of the divestment process and have agreed to sell Soprole to Gloria Foods – JORB S.A. (Gloria Foods).”

Gloria Foods is a consumer dairy market leader in Peru, with operations in Bolivia, Puerto Rico, Argentina, Colombia and Uruguay.  Fonterra and Gloria Foods have a long-standing commercial relationship in South America. . .

Pig farmer tickled pink by top ham award :

 North Island farmer Jim Mather takes great pride in “growing fantastic animals” on his farm near Foxton – but he was still surprised to find a ham from one of his pigs had won the highly coveted Supreme Award in the 2022 100% New Zealand Bacon and Ham Awards.

Auckland’s Westmere Butchery won New Zealand’s best ham award for their bone-in leg ham, but a journey back along the supply chain to discover the provenance of the champion ham, leads to Jim Mather’s family farm.

“We know it’s fantastic pork – because our pigs want for nothing,” says Jim.

“But you don’t usually get a lot of validation for your product as a farmer. We really appreciate that the winner made a point of making sure we knew it was one of ours – we’re absolutely delighted.” . . 

The promise of seagrass pastures – Mel Silva :

In Lau Group in Fiji, seagrass meadows play a special and vital role for the environment, marine life and community. These underwater pastures help to maintain water quality, provide a habitat for diverse flora and fauna – while also supporting local industries and cultural practices.

On a broader scale, these marine environments are critical to the health of our global climate. Similar to forests on land, seagrass can take carbon dioxide out of the atmosphere as it grows – storing it through a process called carbon sequestration. Seagrass is one of the world’s most effective carbon storage powerhouses, and it can store carbon 35 times faster than tropical rainforests.

Measuring the carbon capacity of ecosystems allows nations to participate in climate discussions, evaluate their contributions and better manage their ecosystems’ vitality. However, gathering this information is much more complex in an underwater environment than it is on land. Traditional methods for carbon assessment of coastal and marine ecosystems have relied on remote geospatial and aerial sensing technology that can be affected by cloud cover, angle of the sun and weather – and getting results from this imagery relies on costly and time consuming manual image analysis.

Under the Digital Future Initiative, we’re launching a new ‘blue carbon’ project in partnership with CSIRO, Australia’s national science agency, the Department of Foreign Affairs and Trade (DFAT) and Tidal (an ocean health project within X) to address these barriers. Together, we’re exploring novel applications of artificial intelligence to measure, with greater efficiency and accuracy, the capacity of seagrass ecosystems to absorb and sequester carbon. . . 

 


Rural round-up

17/10/2022

Farmers react to government’s HWENN stance– Richard Rennie & Annette Scott:

Masterton farmer and Beef + Lamb NZ councillor Paul Crick says there’s a fundamental unfairness in the government’s interpretation of He Waka Eke Noa, one that conflicts with its own policy goals.

“Reading the ‘Fit for a Better World’ policy document, in Damien O’Connor’s foreword he writes how its aim is to build a more productive, sustainable and inclusive food and fibre sector. That appears a lot throughout the document, ensuring a better future for farmers and growers. How then do we throw that lens over what we heard on HWEN this week?”

Crick said there is a fundamental unfairness in the removal of the ability to sequester methane against farm vegetation, and in ignoring the 1.4 million hectares of woody vegetation already growing on NZ drystock farms that could be applied.

“It seems they are saying on one hand we will take it, and on the other we will take it as well. There is no balancing of the ledger there.”  . . .

Why blame cows Maori farmer rejects ETS money grab? – James Perry:

Paki Nikora, a trustee of Te Urewera-based Tātaiwhetu Trust, says he can’t fathom why farmers continue to be blamed for the world’s greenhouse gas emissions.

“Mēnā tātou ka whakaaro i te wā ka pā mai te mate uruta kia tātou, ka makere mai ngā ēropereina i te rangi, ka makere mai ngā motuka i ngā huarahi ka mārama te kitea atu i te taiao ki te whare rā anō o te atua. Kei te whakapae rātou nā ngā kau kē te hē.
(If we think back to when the covid pandemic hit us and the planes were grounded and cars were off the roads, it was clear to see the improvement in the environment. But they still want to blame the cows.) 

He describes the government’s emissions reduction scheme is a “senseless tax” on the industry.

“Kāore au i te mārama he aha rātou e huri mai nei ki te tāke i a tātou whenua. He mahi moni noa tērā.”
(I don’t know why they keep trying to tax us on our whenua. It’s just a plain money grab) . . 

Why New Zealand meat is outstanding in its field – Annette Scott :

Going from the laboratory to the family dinner table, a multi-year research programme looked into the relative nutritional benefits of grass-fed beef and lamb, and plant-based alternatives. Annette Scott found out why grass is so great.

A New Zealand research programme has found pasture-raised beef and lamb beats both grain-fed beef and plant-based alternatives when it comes to health and wellbeing benefits for consumers.

The four-year programme brought together researchers from AgResearch, the Riddet Institute and the University of Auckland and included two ground-breaking clinical trials to look at the impact of red meat on the diet.

The clinical trials assessed the physical effects on the body from eating beef or lamb raised on grass, grain-fed beef and plant-based alternatives, and looked at measurements of wellbeing such as satisfaction, sleep and stress levels. . . .

 

Mt Cook Alpine Salmon to build innovative land-based salmon farm :

A prototype for New Zealand’s first sustainable, land-based salmon farm is in the early stages of development, with backing from the Ministry for Primary Industries’ Sustainable Food and Fibre Futures (SFF Futures) fund.

SFF Futures is committing $6.7 million over six years to the $16.7 million project, which was officially launched in Twizel today. Oceans and Fisheries Minister David Parker attended the launch and visited the freshwater salmon farms to hear about Mt Cook Alpine Salmon’s plans for building the prototype.

“Demand for healthy, sustainably produced aquaculture products continues to grow, and land-based salmon farming will enable New Zealand to boost the supply of this high-quality, high-value product,” says Steve Penno, MPI’s director of investment programmes.

Mr Penno says the project aligns with the Government’s aquaculture strategy, which outlines a sustainable growth pathway to an additional $3 billion in annual revenue. . . 

Fonterra revises milk collection :

Fonterra Co-operative Group Limited today revised the forecast for its 2022/23 New Zealand milk collections to 1,480 million kilograms of milk solids (kgMS), down from its previous forecast of 1,495 million kgMS.

Fonterra last reduced its 2022/23 milk collections forecast in early September. Fonterra CEO Miles Hurrell says this was due to weather conditions in parts of New Zealand causing a slow start to the season.  . . .

 

My food bag launches homegrown taste adventures to celebrate Nadia’s farm :

My Food Bag has released its latest meal kit offering to enable Kiwi foodies the opportunity to recreate dishes featured on Three’s new programme, Nadia’s Farm.

My Food Bag is a proud sponsor of Nadia’s Farm, an unfiltered look at Nadia and her husband Carlos as they re-establish Royalburn Station, airing Wednesday nights on Three and ThreeNow.

Bringing the fresh and high quality ingredients seen on television direct to Kiwi kitchens, My Food Bag is releasing meal kits inspired by meals seen on Nadia’s Farm and has launched a farm shop filled with products from Royalburn Station, and other boutique New Zealand suppliers.

Jo Mitchell, Chief Customer Officer of My Food Bag, says supporting Nadia’s Farmis a way to celebrate the best of New Zealand food and what happens on the farm to make that possible for us. . . 

 


Record payout

22/09/2022

Fonterra has announced a record payout:

. . .Fonterra today announced a strong set of results for the financial year ending 31 July 2022, reflecting a 2021/22 Farmgate Milk Price of NZ$9.30 per kgMS and normalised profit after tax of NZ$591 million. 

With a total dividend of 20 cents per share to our fully shared-up farmers – comprising of an interim dividend of 5 cents per share and a final dividend of 15 cents per share – the final cash pay-out for farmers is $9.50.

Total Group normalised Earnings Before Interest and Taxes (EBIT) was NZ$991 million, up NZ$39 million or 4% on the prior year. 

Chief Executive Miles Hurrell says despite the challenges including increased costs associated with supply chain volatility, 2021/22 was a good year for the Co-op.

“These results demonstrate that our decisions relating to product mix, market diversification, quality products and resilient supply chain, mean the Co-op is able to deliver both a strong milk price and robust financial performance in a tough global operating environment.

“The Co-op is pleased to be able to pay a total dividend of 20 cents per share for our farmer owners and unit holders. And this year’s higher Farmgate Milk Price is the strongest it has ever been, which is great news for our farmers. New Zealand also benefits from this, with $13.7 billion returned into the economy in milk price payments alone this year.

“Importantly, one year on, the Co-op is making tangible progress against our strategy – namely to focus on New Zealand milk, be a leader in sustainability and a leader in dairy innovation and science. . . 

This is good news for farmers, sharemilkers and the wider economy and the outlook for the current season is positive in spite of global uncertainties.

The forecast farmgate Milne price for this season is a range of NZ$8.50–$10.00 per kgMS, with a midpoint of NZ$9.25 per kgMS and a range of  45-60 cents for shares.

 


Rural round-up

13/09/2022

Research looks at breeding more climate friendly cows :

New research has confirmed bulls’ genetics play a role in how much methane they emit, highlighting the potential for farmers to breed low methane-emitting cows in the future.

The news comes following the first year of a research programme run by major New Zealand artificial breeding companies LIC and CRV.

The research, funded by the New Zealand Agricultural Greenhouse Gas Research Centre (NZAGRC), measures methane emissions from the burps of young bulls set to father the next generation of New Zealand’s dairy cows.

Results from year one, where the feed intake and methane emissions from 281 bulls were measured, found there is genetic variation in the amount of methane emitted after accounting for the feed eaten by the bulls, with the lowest emitting around 15-20% less methane than the average. . .

David Parker must delay winter grazing regulations :

The Government is about to pile up to $100 million of unnecessary compliance costs onto farmers because its freshwater regulations are more than a year overdue, National’s Agriculture spokespeople Barbara Kuriger and Joseph Mooney say.

“Under Environment Minister David Parker’s regulations, farmers must have a certified freshwater farm plan for winter grazing on sloping land. If they do not have a certified plan, they must obtain a resource consent,” Barbara Kuriger says.

“Two years after the regulations were passed, the Ministry for the Environment has not completed the framework allowing farmers to certify freshwater farm plans. Officials have indicated the framework will not be ready this year.

“The regulations have already been delayed by David Parker twice, but are now due to come into force in November. Because the guidelines will not be ready, many thousands of farmers will have no alternative but to apply for resource consents for their winter grazing. . . 

How Miles brings smiles to the nation’s cowsheds this time by upgrading earnings guidance – Point of Order:

The giant  dairy co-op Fonterra  has  sent  a  shiver  of  excitement  through the  country’s   cowsheds     by   upgrading  its earnings guidance to between 45 and 60c per share, up from 30 to 45c per share for the 2022-23  season.

At  a  time  when  other  sectors  of  the  economy   are  under  pressure, and the  dairy industry is  coping with  difficult  climatic  conditions,  Fonterra in effect is signalling  that NZ’s export  mainstay can  do  even  better  than it  did in the  previous outstanding season  in sustaining its  export  earnings.

Some  might   say  Fonterra is  at  last  on  the  brink of  fulfilling  the  promise  its  founders held  for it 20-odd  years  ago.

Fonterra chief executive Miles Hurrell foresees  the  possibility  that if  current conditions  persist, the revised guidance  could be raised   again. . . 

Sheep farmers roll out woollen mate for the wellnes market – Country Life:

With crossbred wool prices remaining low, some sheep farmers are having a serious crack at adding value to the fibre they proudly grow.

Canterbury farmers Jane and Mark Schwass are making felted wool exercise mats from their crossbred wool clip.

“A daughter brought a woollen mat home that was made offshore and imported into New Zealand for quite a significant amount of money and we thought, ooh this is something we could be thinking about!”

Most people use the woollen mats for Yoga and Pilates, Jane tells Country Life. . . 

Whaitiri to promote dairy sector’s interests in India while O’Connor deals with the IPEF – but he aims to review dairy quota, too – Point of Order:

Two new announcements  have been posted on the Beehive website since our monitoring yesterday, one dealing with the dairy sector, the other with New Zealand’s trade relationships.

One announcement said Food Safety Minister Meka Whaitiri is headed for India to address the World Dairy Summit in New Delhi, the flagship event of the International Dairy Federation.

The other said Trade and Export Growth Minister Damien O’Connor is in the USA where he has joined ministerial representatives from 13 other economies across the Indo-Pacific region to launch negotiations on the Indo-Pacific Economic Framework for Prosperity (IPEF).

A week earlier O’Connor had made another trade-related announcement with particular implications for the dairy industry, . . 

Central Australian cattle station saves big in maintenance after employing all-female crew – Hugo Rikard-Bell:

It’s about midday on Umbearra Station, and owners Angus and Kimberley McKay are sitting down for lunch with their crew, who are recapping the antics of the William Creek races held the weekend just gone.

Sixteen years ago, when Mrs McKay first arrived on the remote cattle property, 300 kilometres south of Alice Springs, the dining room set-up looked a little different. 

“I was the only female, and we’d have a whole table of males,” she said. 

Now, the tables have turned, and it is Mr McKay who is sitting at a full table of females, eating a lunch of freshly made quiche and salad. . . 


What goes up . . .

10/05/2022

Fonterra has revised its forecast farmgate milk price down:

Fonterra Co-operative Group Limited today revised its 2021/22 forecast Farmgate Milk Price range from $9.30 – $9.90 per kgMS to $9.10 – $9.50 per kgMS.

This reduces the midpoint of the range, which farmers are paid off, from $9.60 per kgMS to $9.30 per kgMS.

Fonterra CEO Miles Hurrell says the change in the forecast Farmgate Milk Price is due to a number of recent events which have resulted in short-term impacts on global demand for dairy products – in particular, the lockdowns in China due to COVID-19, the economic crisis in Sri Lanka and the Russia-Ukraine conflict.

“While the long-term outlook for dairy remains positive, and we expect global demand and supply to be more balanced over the rest of the year, we have seen these short-term impacts flow through into pricing on the Global Dairy Trade (GDT) platform. For example, average prices for whole milk powder (WMP), a key driver of the milk price, have decreased by 18% over the past four GDT events.

“As an exporter to 140 countries we deal with these kinds of global events all the time, but right now we’re seeing the impact of multiple events. Coupled with inflationary pressures, it’s not surprising to see buyers being cautious.

“Our scale and ability to move products between different markets and categories remains important, and reinforces our strategic focus on ensuring our milk is going into the highest value products.

“This will be disappointing for our farmers, but the change in global dairy prices is coming off record high levels. At a midpoint of $9.30 per kgMS, this would continue to be the highest forecast Farmgate Milk Price in the Co-op’s history and would see us contribute almost $14 billion into New Zealand’s economy through milk price payments, which supports the wellbeing of our local communities.

“Looking out to the rest of the year, global milk production is expected to remain constrained as high feed, fertiliser and energy costs continue to impact production in the Northern Hemisphere, and we expect demand to recover as the short-term impacts begin to resolve.

“While there is still a high level of uncertainty in global markets, the majority of our milk has been contracted for the season. It’s for this reason that we’ve made the decision to narrow our forecast range to +/- 20 cents.

“As always, there are a number of risks we are continuing to keep a close eye on, including potential impacts on demand from inflationary pressures and rising interest rates, increased volatility as a result of high dairy prices, and further disruptions from COVID-19 and geopolitical events.”

It’s disappointing but not surprising. What goes up eventually comes down, and recently global prices have been going down from the peak reached a few months ago.

Last year some were suggesting this season’s milk price could start with a 10, but China’s Covid lockdown and Russia’s invasion of Ukraine coupled with international and domestic inflation have put paid to that.

However, the low point is still above $9 which is a very good payout.

Uncertainty here and abroad make it unlikely that next season’s forecast will be as high and a rural banker told me that a lot of clients are using the combination of good returns this season and the threat of higher interest rates to pay down debt.

That is prudent. When inflation will boost input prices, reducing the amount borrowed is one way to lower costs without reducing production.

If only the  government understood this prudence and wasn’t so keen on ensuring the only exception to what goes up must come down with tax.


Rural round-up

22/03/2022

Book culling space now! – Peter Burke:

Livestock farmers are being urged to plan ahead for possible meat processing disruption due to Covid-19.

The expectation of some farmers that they can ring up a buyer at short notice and have animals collected quickly and taken to the processing works is unrealistic at the moment.

The chair of the Animal Welfare Forum Lindsay Burton says with Omicron in the community, there is a high degree of uncertainty around the availability of a labour force in processing plants. He says even before the recent omicron outbreak, the industry was 5,500 workers short and the situation has the potential to get worse.

The Farm to Processor Animal Welfare Forum – a grouping of various industries related to livestock farming – says it is critical that farmers book space at meat processors well in advance. It is also warning farmers to be prepared to potentially hold stock on farm for longer. . . 

‘It’s beyond a joke’ – farmer outraged at milk tanker fracas near front gate – Chloe Blommerde:

A dairy farmer reckons $80,000 worth of milk could have gone down the drain during a milk tanker fracas with boy racers on the road near his front gate.

Footage of the incident shows a group of people crowding around a Fonterra tanker and its driver in the middle of the night as a stream of white pours onto the tarseal, however it’s unclear how much was lost.

Police received a report that a milk truck was damaged by a group of people near the intersection of Stokes and Orini roads in Waikato around 1.20am on Saturday.

The rural crossroads is a well-known spot for street racers to park up and do burnouts at the weekend. . . 

Fonterra to exit Russian business :

Fonterra has today announced it will exit its businesses in Russia. This follows the Co-op’s decision to suspend shipments of product to Russia at the end of February.

CEO Miles Hurrell says “our first step following Russia’s invasion of Ukraine was to establish the safety of the team in Russia, and our priority through this process continues to be doing the right thing by our people.

“We then suspended shipment of product to Russia while we assessed the impact of economic sanctions and discussed our long-term plans with our customers and joint venture partner.

“Following careful consideration of the impact on our people and our long-term plans for the Russian market, we will now close our office in Moscow, re-deploying staff where possible, and withdraw from our joint venture Unifood.” . .

Business relationships crucial to success of winning farmers :

Bay of Plenty Share Farmer of the Year winners Scott and Becks O’Brien say farmers have nothing to lose and everything to gain in Dairy Industry Awards. Their advice to potential entrants is to give it a go.

“Whether you come first or last doesn’t really matter, because the networking with so many different people, and the feedback and information and scrutiny you’re getting on your business is as valuable as winning. You just have to give it a go. It’s little nerve wracking, but we really enjoyed it, and what you get out of it is so worth it.”

The O’Briens are sharemilking 900 cows on two farms about 10 minutes apart in the Galatea district. Since 2017 they have milked 650 cows on Rory and Susan Gordon’s 260-hectare farm, and since 2020 have been milking 250 cows on Cathy and Peter Brown’s 100-hectare property.

Scott has been dairy farming since he left school, just over 20 years ago. He and Becks have been married for 16 years. The start of their relationship was dramatic, with 21-year-old Becks diagnosed with cancer just after they met. It has permanently affected her voice, but after being at home with their young family – 12-year-old Hunter, 10-year-old Summer, and 8-year-old Piper – she has become an educational support worker at Galatea School (where Scott is also on the board of trustees). . . 

From Auckland to Reporoa lifestyle choice brings success in Dairy Industry Awards:

A former Auckland sales and marketing executive and a former adventure tourism guide and boutique lodge manager have won the 2022 Central Plateau Share Farmer of the Year title.

Todd and Renee Halliday were announced the winners of the region’s Share Farmer of the Year category at the Central Plateau Dairy Industry Awards annual awards dinner held at the Lake Taupō Yacht Club on Thursday night. The other big winners were Satveer Singh, who was named the 2022 Central Plateau Dairy Manager of the Year, and Zoe Bryson, the 2022 Central Plateau Dairy Trainee of the Year.

Todd was born and bred in Auckland city and had never set foot on a farm until he met Renee, who is a dairy farmer’s daughter. The couple spent five years in the hospitality sector managing boutique lodges together before entering the dairy industry in 2009.

Todd initially spent two years as a farm assistant in Reporoa before progressing to a management role for a further two years. He and Renee then spent seven years in Mid Canterbury before returning to Reporoa where they now contract milk and are equity partners with Phil and Diane Herdman, on a 153ha Reporoa property, milking 520 cows. They won $17,060 in prizes and eight merit awards. . . 

RIP plant based meat mania – Prime Future:

I am often asked about my view on alternative meats and the threat they pose to old fashioned, plant-fed meat. I’ve stayed away from that question, for the most part because I’m just more interested in plant-fed meat.

First, it’s important to separate “alternative meat” into 3 distinct buckets: plant-based, fermented, cell-based.

Today we are looking at the plant-based meat category. Spoiler alert: I find the plant-based meat category bland and uninspiring. And honestly, I think we can reasonably lay plant-based meat mania to rest in peace in the history books, right alongside 1990’s emu farming mania in the US.

Some background on VC’s appetite for the category: . . 


Rural round-up

17/03/2022

‘Unviable to grow produce’ in NZ: Farmers blame rising cost of energy, rates, wages, audits – Sally Murphy:

Increasing costs are putting a huge strain on vegetable growers, with some considering hanging up their tools.

Energy costs have almost doubled in the past year, the minimum wage has gone up and the price of on-farm audits are rising – making growing vegetables more expensive.

NZ Gourmet director of production Roelf Schreuder said the business needed to have audits for certification, water quality, chemical storage and health and safety, just to name a few.

“For certification for NZ Gap and Global Gap they come a couple of times a year and charge about $240 an hour to sit down and check the books, so growers are having to spend more time and money preparing for them as well as paying for the actual audit – it’s a big cost. . . .

Fruit and vegetables drive up annual food prices :

Annual food prices rose 6.8 percent in February 2022 compared with February 2021, Stats NZ said today.

This was the largest annual increase since July 2011 when prices increased 7.9 percent.

In February 2022 compared with February 2021:

  • fruit and vegetable prices increased by 17 percent
  • grocery food prices increased by 5.4 percent . . .

A farmer’s perspective:

After enduring COVID19 and isolating for 10 days, I was asked to give my opinion on how we managed the farm, family and staff.  Regardless of how people think of COVID19, whether it’s a she’ll be right mentality or you have ordered a pallet of Vitamin C along with toilet roll, the reality is you’re going to get sick.

We were prepared with a COVID plan.  We knew our legal obligations around milk pick up and we knew we needed to be a step ahead.  The virus hit us pretty hard and happened within a day of first contact. Within those first 24hrs I had rung our neighbours, our 2IC, Fonterra (area manager and milk collection), our bank, school and thereafter kept everyone updated.  We had a designated drop off point for food, medication and anything that was needed for the farm.  We were able to work most of the days out of necessity and kept away from our 2IC. We had to amend our milking times to be able to use a relief milker. To put things in perspective, adults were double vaxed with boosters. Kids not vaccinated. We still caught the virus but certainly didn’t need any outside medical intervention or Hospitalisation. COVID will affect people differently.

We got very sick and it was tough watching the kids going through it.  We lived on paracetamol, vitamins and electrolytes and we used my “My Food Bag”. We put the farm on sleep mode for about 5 days. We didn’t want to overwhelm staff with the extra workload so we kept the jobs to essential along with milking.  I would suggest checking your calendar and canceling all your appointments. We had a shed inspection during COVID but all went well. In hindsight I would have cleared the calendar.  We did have people call to the door and had to tell them our situation, most were thankful for our honesty, some were less than pleased.  Public perception has shown me people are scared and nervous.  At one point when the fever hit hard and the body ached and every orifice was evacuating someone drove into the driveway and I sure I heard, bring out your dead!  But after day 6 we were on the mend.  . .

Fonterra reports its Interim Results :

  • Total Group Revenue: NZ$10,797 million, up 9%
  • Reported Profit After Tax NZ$364 million, down 7%
  • Normalised Profit After Tax: NZ$364 million, down 13%
  • Total Group normalised EBIT: NZ$607 million, down 11%
  • Net Debt: NZ$5.6 billion, down 8%
  • Total Group normalised Gross Profit: NZ$1,607 million, down 7%
  • Total Group normalised Gross Margin: 14.9% down from 17.4%
  • Total Group Operating Expenditure: NZ$1,062 million, up 1%
  • Normalised Africa, Middle East, Europe, North Asia, Americas (AMENA) EBIT: NZ $250 million, up 25%
  • Normalised Greater China EBIT: NZ$236 million, down 20%
  • Normalised Asia Pacific (APAC) EBIT: NZ$158 million, down 33%
  • Full year forecast normalised earnings per share: 25 – 35 cents per share
  • Interim Dividend: 5 cents per share
  • Forecast Farmgate Milk Price range: NZ$9.30 – $9.90 per kgMS
  • Forecast milk collections: 1,480 million kgMS, down 3.8%

Fonterra Co-operative Group Limited today announced its 2022 Interim Results which show the Co-op has delivered a half year Profit After Tax of NZ$364 million, a Total Group normalised EBIT of NZ$607 million, and a decision to pay an interim dividend of 5 cents alongside a record high forecast Farmgate Milk Price.

Fonterra CEO Miles Hurrell says the Co-op’s results for the first half of the financial year show it is performing well, while creating the momentum needed to achieve its 2030 targets. . .

Māori owned dairy company, Miraka, has appointed global food industry executive, Karl Gradon, as its new CEO :

Chairman, Kingi Smiler has welcomed Mr Gradon’s appointment which followed an extensive search.

“We’re delighted to appoint Karl as our new CEO. He has solid credentials and international experience in business development and strategy across the dairy, agricultural and primary industry sectors.”

Karl spent nearly 20 years in the dairy industry with Fonterra and Kerry Ingredients holding Senior Management positions in Asia, Europe, Latin America and the USA.

Since returning home, he has taken up a range of governance roles and directorships in economic development and business. Karl was also CEO of New Zealand Mānuka Group helping that business grow its Mānuka honey and oil production.” . . 

Groundswell NZ proposes emissions reduction plan :

The proposals put forward under the He Waka Eke Noa Partnership are so unworkable that Groundswell NZ is proposing its own alternative, Groundswell NZ leader Bryce McKenzie said.

“None of the options are workable and, like the Emissions Trading Scheme, they will deliver worse outcomes for the environment, farmers, and our country.”

“We back Federated Farmers President Andrew Hoggard’s view, that none of the options are long term solutions and that an emissions tax, without affordable and practical new technologies, would kill off the farming sector.”

“Groundswell NZ’s alternative is an integrated environmental policy framework incentivising and enabling on the ground actions across all aspects of the environment, including freshwater, indigenous biodiversity, and emissions.” . . 

                                                                   

Ukraine – how the global fertiliser shortage is going to affect food – John Hammond & Yiorgos Gadanakis :

We are currently witnessing the beginning of a global food crisis, driven by the knock-on effects of a pandemic and more recently the rise in fuel prices and the conflict in Ukraine. There were already clear logistical issues with moving grain and food around the globe, which will now be considerably worse as a result of the war. But a more subtle relationship sits with the link to the nutrients needed to drive high crop yields and quality worldwide.

Crops are the basis of our food system, whether feeding us or animals, and without secured supply in terms of volume and quality, our food system is bankrupt. Crops rely on a good supply of nutrients to deliver high yields and quality (as well as water, sunlight and a healthy soil), which in modern farming systems come from manufactured fertilisers. As you sit and read this article, the air you breath contains 78% nitrogen gas – this is the same source of nitrogen used in the production of most manufactured nitrogen fertilisers.

However, to take this gas from the air and into a bag of fertiliser takes a huge amount of energy. The Haber-Bosch process, which converts nitrogen and hydrogen into ammonia as a crucial step in creating fertilisers, uses between 1% and 2% of all energy generated globally by some estimates. Consequently, the cost of producing nitrogen fertiliser is directly linked to the cost of fuel. This is why the UK price of ammonium nitrate has climbed as high as £1,000 per tonne at the time of writing, compared to £650 a week ago.

Fertiliser inputs to farming systems represent one of the largest single variable costs of producing a crop. When investing in fertiliser, a farmer must balance the return on this investment through the price they receive at harvest. Adding more fertiliser, for a small improvement in yield, might not pay for itself at harvest. . .


Rural round-up

18/02/2022

Climate scientists urge countries to adopt split gas approach :

In a paper published in the prestigious Nature journal, 33 leading climate scientists call for countries to take a split gas approach when setting targets for greenhouse gas emissions reduction, such as New Zealand did in our Climate Change Response Act (Zero Carbon Bill).

The paper also encourages countries to use a split gas approach when determining their Nationally Determined Contributions (NDCs) under the Paris Agreement. 

The natural extension is that countries should report on warming rather than just emissions, something B+LNZ has been asking for for some time.  

The paper is an important and valuable contribution to conversations about reporting and targets. We’ll be using it as part of our ongoing advocacy efforts, alongside like-minded organisations such as the Meat Industry Association, DairyNZ, Federated Farmers, Deer Industry New Zealand and others. This means sharing it with Government officials and providing information to media outlets to build understanding.  . . 

Staff shortage still a struggle despite new policy – Neal Wallace:

Just a handful of foreign dairy farm workers and agricultural machinery operators have been granted access following Government changes to the class exception policy approved in December.

Data supplied by the Ministry for Business, Innovation and Employment (MBIE) reveals just 51 foreign dairy farm workers and 15 mobile plant operators have been granted visas under the new class exception policy.

Despite pleas from the meat industry for a class exemption for Halal butchers, approval for inclusion in the scheme is yet to be considered by Cabinet.

The uptake of the revised policy is well short on the number the Government allowed for. . . 

Passion for farming goes a long way – Colin Williscroft:

Align Farms chief executive Rhys Roberts recently won the 2022 New Zealand Zanda McDonald Award, which supports talented and passionate young professionals in the ag sector. Colin Williscroft reports.

He may be chief executive of a company that operates seven farms, a market garden, a milk factory and a yoghurt brand, but Rhys Roberts’ pathway was one that has traditionally been followed by many in the dairy sector.

Roberts and his wife Kiri were Canterbury sharemilkers before joining Align Farms nine years ago as farm managers.

Then after a stint as operations manager, he was appointed chief executive in 2017. . . 

Woolly thinking pays off

Serial entrepreneur Logan Williams will be a guest speaker at this month’s East Coast Farming Expo.

He may only still be in his 20s, but Williams has a track record that is the envy of many. The inventor and entrepreneur has already developed and sold four inventions to international corporations, including one that could create a turning point for the struggling wool industry.

Williams is currently combining coarse wool with polylactic acid derived from corn starch and other polymers to produce Keravos pellets that can be used instead of plastic. Torpedo 7 is about to launch a kayak range made from the revolutionary material and trials are well underway with ski boots, furniture, and other products.

“Our factory in Hamilton can make four tonnes a day of these pellets, so the plan is that we partner with large companies who are already making product and away we go – plug and play,” he explains. . . 

Fonterra, NZX and EEX enter GDT partnership for future growth :

Fonterra has agreed a strategic partnership with New Zealand’s Exchange (NZX) and the European Energy Exchange (EEX) to each take ownership stakes in Global Dairy Trade (GDT) alongside the Co-op.

Subject to the approval of Boards, clearance from European or any other relevant competition law authorities, and finalisation of transaction documentation, the partnership is expected to be completed mid-2022, with Fonterra, NZX and EEX each holding an equal one-third (33.33%) shareholding in the global dairy auction platform.

Fonterra Chief Executive Miles Hurrell says the move to a broader ownership structure marks the next step in the evolution of GDT – further enhancing the standing of GDT as an independent, neutral, and transparent price discovery platform, giving it a presence in prominent international dairy producing regions, and creating future growth opportunities. . .

New Zealand’s first plant based milk bottle hits South Island shelves :

  • Anchor’s plant-based bottle, made from sugarcane – which is a natural, renewable and sustainably sourced material – is now available in the South Island.
  • The new bottle is an example of sustainable packaging which is something that is important to Anchor and its consumers.
  • Since the plant-based bottle was launched in the North Island in 2020, Kiwis have saved enough emissions to travel from Cape Reinga to Bluff 363 times*
  • Anchor’s plant-based bottle is recyclable in kerbside recycling collections . . 

Fonterra forecasts record payout

25/01/2022

Fonterra is forecasting a record milk payout:

Fonterra Co-operative Group today lifted its 2021/22 forecast Farmgate Milk Price range to NZD $8.90 – $9.50 per kgMS, up from NZD $8.40 – $9.00 per kgMS.

This increases the midpoint of the range, which farmers are paid off, by 50 cents to NZD $9.20 per kgMS.

Fonterra CEO Miles Hurrell says the lift in the 2021/22 forecast Farmgate Milk Price range is good news for both farmers and New Zealand communities. The new midpoint of $9.20 per kgMS would contribute $13.8 billion to the New Zealand economy this season.

“The increase is the result of consistent demand for dairy at a time of constrained global milk supply.

“In general, demand globally remains strong – although, we are seeing this vary across our geographic spread. Overall, global milk supply growth is forecast to track below average levels, with European milk production growth down on last year and US milk growth slowing due to high feed costs.

“It’s a similar supply picture in New Zealand. Earlier this month we reduced our forecast milk collections for 2021/22 from 1,525 million kgMS to 1,500 million kgMS due to varied weather and challenging growing conditions.

The grapevine says production is down all over our district.

We’ve had a lot of rain which has been very good for the quantity of grass growth but the quality of feed has been lower which has impacted on milk production.

“While the higher forecast Farmgate Milk Price does put pressure on our margins in our consumer and foodservice businesses, prices in our ingredients business are favourable for milk price and earnings at this stage. As a result, we remain comfortable with our current 2021/22 earnings guidance of 25-35 cents per share.”

Mr Hurrell says there are a number of factors the Co-op is keeping a close eye on, including growing inflationary pressures impacting on operational costs, the increased potential for volatility as a result of high dairy prices and economic disruptions from COVID-19, particularly as governments respond to the rapid spread of the Omicron variant.

 This is a forecast and forecasts can change but it would be a safe bet that the final payout will be nearer $9 than $8.

That is a very welcome bright spot for the economy that is looking increasingly gloomy.


Rural round-up

18/12/2021

 Government ‘tone deaf’ to meat industry’s needs – Sally Rae:

The Meat Industry Association has lambasted what is understood to be the approval of 15 long-term critical worker visas for halal butchers – when 45 are “desperately” needed – saying it shows the Government is “tone deaf to the needs of business”.

Muslim markets and many customers demanded meat be processed in the halal way; 49 out of 55 processing plants in New Zealand operated halal systems and relied on 250 halal butchers.

In a statement yesterday, MIA chief executive Sirma Karapeeva said the “miserly” approval knee-capped the ability of the second-largest goods export sector to fully contribute to New Zealand’s economy and capture higher value from its exports.

Halal certified products contributed about $3.7 billion of annual export earnings. The sector could typically recruit only 100 halal butchers domestically due to New Zealand’s small Muslim population and the nature of the job. . . 

Farmers will want to milk it – Sudesh Kissun:

Dairy farmers will be milking cows for as long as they can to capitalise on a record milk price this season.

Soaring farm input costs may erode profit margins, but a milk price near $9/kgMS provides farmers the chance to boost income and reduce debt.

Fonterra chief executive Miles Hurrell says farmers around the globe are facing inflationary pressures and NZ is no exception.

“But I don’t think there will be any adverse reaction to milk production,” says Hurrell. . .

T&G Global to invest millions in automated packhouse, orchard redevelopment

Produce company T&G Global has announced it will pour in millions of dollars to expand its apples business to meet growing consumer demand. 

The company will invest $100 million into a new automated packhouse and has committed millions more to orchard redevelopment across Hawke’s Bay and Nelson.

The announcement comes after T&G downgraded its full-year profit expectations in October, due to persistent labour shortages and rising shipping costs.

T&G, which is one of New Zealand’s largest apple growers and marketers, said its premium Envy apple was on track to be a billion-dollar brand. . . 

Funding of hemp fibre innovation set to propel New Zealand on to world stage :

New Government funding will help a New Zealand hemp fibre company explore untapped opportunities – from soft flooring to food packaging that’s more environmentally sustainable.

The Government is contributing $1.34 million through MPI’s Sustainable Food and Fibre Futures fund (SFF Futures) to New Zealand Natural Fibres’ (NZNF) five-year research and development programme project. NZNF is the only hemp fibre company in New Zealand that controls its own supply chain end-to-end. The company is contributing a further $2 million in cash and in kind to the project.

“We plan to use the SFF Futures funding to develop our hemp growing, processing and marketing capability to ‘go further, faster’ towards taking a global leadership position in the development of industrial and consumer products made from hemp fibre,” says NZNF CEO Colin McKenzie.

“We are very pleased to have received government backing to continue our work with hemp fibre, which has huge potential to be part of the solution to some of the most crucial environmental challenges facing our planet today. . . 

Gearing up for harvest:

The export cherry season is now underway and in New Zealand, summerfruit has started appearing in the supermarkets.  In other words, the new season’s fruit harvest is gathering pace, as Christmas fast approaches and the great kiwi summer getaway also gets underway. 

Tomorrow, the Auckland borders will finally be open. Unfortunately across some areas of the country, there is apprehension and reservations about this change.  But let’s not pre-empt any negative thoughts.  Our Auckland comrades have done it very hard for a long period.  To help growers and packhouse operators prepare for in the event of a positive Covid test, we have worked with the Ministry of Primary Industries to pull together advice on what to do.  Click here to access that advice. 

The most important things to do are to isolate the worker and their bubble, alert your local District Health Board and follow their instructions regarding the public health implications, and contact your product group for further advice.  In terms of any media interest, it is recommended to direct any journalist to your product group or HortNZ for any comment as you will be busy managing the response and we are all here to help you.  . . 

Once perceived as a problem, conservation grazing by cattle a boon to vernal pools :

Giving 1,200-pound cows access to one of California’s most fragile and biologically rich ecosystems seems a strange way to protect its threatened and endangered species.

But a recently published study suggests that reintroducing low to moderate levels of cattle grazing around vernal pools – under certain conditions – leads to a greater number and greater variety of native plants.

“We found that after 40 years of rest from grazing, reintroducing conservation grazing had – across the board – positive impacts on vernal pool plant diversity,” said Julia Michaels, a visiting professor at Reed College who led a three-year study in a Sacramento-area reserve during her time as a UC Davis Ph.D. student.

Ecologists consider vernal pools – ephemeral ponds that form seasonally – “islands of native habitat” amid California’s grasslands that are dominated by exotic grasses. These biodiversity hotspots harbor about 200 native species of animals and plants, such as the coyote thistle, which germinates under water and forms a snorkel-like straw to deliver oxygen to its roots – and then “fills in” its stem as the pool dries. . . 


Rural round-up

12/12/2021

Shipping delays and staff shortages bite the meat industry – Rachael Kelly:

Farmers are starting to struggle to get stock killed because staff shortages and shipping woes are causing major issues in the meat industry.

Ben Dooley, a farmer from Mimihau in Southland, said he had 200 ewes booked in with Alliance Group next week, but he was worried about finding more space for stock in the coming months.

“It’s definitely concerning. If this shipping container issue doesn’t get sorted out then we’re going to have some big problems in the next few months.”

The Alliance Group and Silver Fern Farms both say chronic labour shortages and global supply chain issues were causing problems. . .

Cheap accommodation, social sport used to entice workers for orchard jobs – Sally Murphy:

Efforts to attract workers to pick and pack fruit this summer are heating up – with more employers offering incentives to attract workers.

On the PickNZ website where orchards and packhouses advertise jobs, 42 percent are offering accommodation and 30 percent are offering bonuses.

Just under 20 percent are offering transport, social events and flexible working hours.

One company advertising on the site is Clyde Orchards. . . 

Fonterra’s Hurrell says New Zealand milk is the most valuable in the world – Tina Morrison:

New Zealand’s grass-fed farming model makes the country’s milk the most valuable in the world, Fonterra chief executive Miles Hurrell told farmers at the co-operative’s annual meeting in Invercargill.

Since taking over from Theo Spierings, Hurrell has moved Fonterra away from expanding its milk pools overseas, and brought the focus back to getting more value from the “white gold” produced by New Zealand farmers. His shift in strategy comes at a time when consumers are wanting to know more about where their food comes from and the environmental impact it leaves.

“We believe New Zealand milk is the most valuable milk in the world due to our grass-fed farming model, which means our milk has a carbon footprint around 70 per cent lower than the global average,” Hurrell told farmers. . .

 

River restoration starting to flow – Colin Williscroft:

The Manawatū River Leaders’ Forum recently won the supreme award at the 2021 Cawthron New Zealand River Awards for the catchment that has made the most progress towards improved river health. Colin Williscroft reports.

In a little over a decade, the Manawatū River has gone from being identified through Cawthron Institute research as one of the most polluted in the western world to that same organisation now celebrating the work being done to clean it up.

The Manawatū River Leaders’ Forum was established in 2010 in response to freshwater health problems facing the catchment.

The previous year Cawthron research showed the river topped a pollution measurement taken on 300 rivers across North America, Europe, Australia and New Zealand for all the wrong reasons. . .

Kiwifruit companies to amalgamate :

Seeka announces third amalgamation in 2021

 Gisborne growers will be delivered a stronger service with the proposed amalgamation of NZ Fruits and Seeka Limited.

In an agreement announced 10 December 2021, NZ Fruits shareholders are being offered Seeka shares and cash for their NZ Fruits shares. Seeka chief executive Michael Franks says the deal will enable Seeka to service the Gisborne region.

“The amalgamation will deliver a strong service to Gisborne growers,” says Franks. . . 

Research aims to develop more resilient sauvignon blanc vines :

An $18.7 million programme is aiming to introduce genetic diversity of New Zealand’s sauvignon blanc grapevines.

The Bragato Research Institute is partnering with New Zealand Winegrowers, more than 20 wine companies and the NZ Viticulture Nursery Association on the seven-year programme.

Agriculture Minister Damien O’Connor the vines were based on one clone which presented some risk.

“Developing improved, commercially-available variants of this grape variety will also act as an industry insurance policy against future risks from pests, disease and changing markets. . . 


Rural round-up

06/12/2021

Wool price making a comeback as overseas demand for product rises :

Higher demand for sportswear, rugs and other wool products has resulted in a resurgence in wool prices.

Prices across all wool types lifted in the year to October, Beef and Lamb’s latest wool export data shows.

Merino was up 28.4 percent to just over $18,000 a tonne and strong wool, which has been struggling with depressed prices, rose 12.1 percent.

PGG Wrightson general manager of wool Grant Edwards said prices are lifting due to higher demand. . . 

Commercial beekeeper numbers drop amid low prices – Maja Burry:

The Ministry for Primary Industries’ latest apiculture monitoring report showed the number of beekeepers with 500 or more hives fell by 9.9 percent to 316 oin the 2020/21 season.

This follows a 7.6 percent drop the previous season.

The total number of registered hives in New Zealand also fell over the last two years to 806,000.

Prior to this the commercial honey industry had been experiencing growth, with a jump in the popularity and price of manuka honey driving a boom in production. . .

NZ agriculture is starting to see value in celebrating its provenance – Tina Morrison:

Much of New Zealand’s agricultural produce is sold as unbranded commodities on global markets. But that’s starting to change as companies discover there is value in heralding their Kiwi provenance.

“New Zealand has got a really strong story and that’s something that we haven’t really told in the past,” says Lincoln University agribusiness and food marketing programme director Dr Nic Lees. “We are making progress. I think we have started on that journey.”

Fonterra, the country’s largest dairy company, has been vocal about its shift in focus under new chief executive Miles Hurrell. Where his predecessor Theo Spierings envisaged the co-operative becoming another big global conglomerate like Danone or Nestle, Hurrell has sold off overseas assets and pulled back to New Zealand to focus on getting more value from the “white gold” produced by local farmers.

Hurrell says Fonterra is only now amplifying the New Zealand provenance message it always knew it had as demand has increased across its global markets to know more about the origin and purity of food. . . 

MLA becomes major supporter of award benefitting Australasian agriculture:

In an exciting development for future leaders in agriculture, Meat & Livestock Australia (MLA) have announced their partnership with Australasian agricultural badge of honour, the Zanda McDonald Award.

The Award, which recognises talented young individuals from Australia and New Zealand who want to make a difference in agriculture, helps take people’s careers to the next level for the betterment of the industry on both sides of the Tasman.

This is delivered through an impressive personal development plan for the finalists on both sides of the Tasman, and a ‘money can’t buy’ prize package for the winners. This prize includes media training, further education, and a tailored mentoring program across both countries, where they spend time up close and personal with some of the biggest leaders and influencers in the sector. . . 

Fellows of New Zealand Winegrowers announced for 2021:

The New Zealand Winegrowers (NZW) Fellows award recognises individuals who have made an outstanding contribution to the New Zealand wine industry.

From making strides in wine governance to adding sparkle to the wine industry, the 2021 NZW Fellows are a group of highly respected and influential individuals who have helped to shape the success of New Zealand wine today.

We are pleased to announce the NZW Fellows for 2021: Steve Smith MW for service to NZW, Wine Institute of New Zealand, and other initiatives, John Clarke for service to NZW and New Zealand Grape Grower’s Council (NZGGC), Andy Frost for service to national research, Rudi Bauer for service to New Zealand Pinot Noir, and Daniel and Adele Le Brun for service to New Zealand bottle fermented sparkling wine. . . 

Eating less meat no climate solution – Shan Goodwin:

AUSTRALIAN-SPECIFIC research is showing the climate benefits of reducing red meat consumption below amounts recommended in dietary guidelines is small and could create negative environmental trade-offs such as higher water scarcity.

The industry’s big service provider Meat & Livestock Australia has released a fascinating report on the topic, which draws extensively from research conducted by CSIRO and other institutions.

Against a backdrop of increasing calls for affluent societies to significantly cut red meat consumption in the name of the environment, the work shows getting Australians to eat less beef is not an effective climate solution.

The Australian Dietary Guidelines recommend eating 65 grams of lean, cooked, unprocessed red meat a day.

The MLA report, called The Environmental Impact of Red Meat in a Healthy Diet, points out that Australian lamb production is in fact climate neutral already. Further, the water and cropland scarcity footprints of Australian beef and lamb are low. . . 


Fonterra forecast milk price up again

03/12/2021

We’ve just got an early Christmas present:

Fonterra Co-operative Group today lifted its 2021/22 forecast Farmgate Milk Price range, reported a solid start to the 2022 financial year and revised its earnings guidance.

The Co-op has lifted and narrowed the forecast Farmgate Milk Price range to NZD $8.40 – $9.00 per kgMS, up from NZD $7.90 – $8.90 per kgMS. This increases the midpoint of the range, which farmers are paid off, to NZD $8.70 per kgMS.  The higher milk price has seen the Co-op revise its earnings guidance to 25-35 cents per share from 25-40 cents per share.

Fonterra CEO Miles Hurrell says the lift in the 2021/22 forecast Farmgate Milk Price range is good news and is an important boost to New Zealand communities. With a midpoint of $8.70 per kgMS, it would contribute more than $13.2 billion to the New Zealand economy.

“It’s the result of consistent strong demand for dairy at a time of constrained global supply.

“We’ve seen the impact of a number of events play out this first quarter. That includes the high price of feed in the US which has seen milk production growth stall and a lower-than-expected supply picture in Europe.

“Fonterra’s New Zealand milk supply is down around 3% on this time last season. While we expect that milk supply will be less than last season’s 1,539 million kgMS, the improving weather conditions and forecast milk collections for the balance of this season that are generally on par with last season support our current season forecast of 1,525 million kgMS.

A lot of wet and warm weather in North Otago has given good grass growth but it’s quantity rather than quality which has impacted on milk production.

“While we’ve seen demand soften slightly in China, global demand remains strong, and we think that will remain the case for the short to medium term.

“A higher forecast Farmgate Milk Price at this level can put pressure on our margins and therefore our earnings, which is why we’ve reduced the top end of our earnings guidance.”

First quarter business update

Fonterra has delivered a Total Group EBIT of $190 million for the three months ending 31 October 2021. This was achieved at a time when input costs are significantly higher than the same period last year. These have been driven by a 30% increase in Whole Milk Powder prices.

Mr Hurrell says there have been a number of factors at play in the first quarter. “We’re seeing stable sales volumes in our Foodservice channel, but a milk price at these high levels has squeezed margins. Our Chilean business continues to improve but tightening margins and weaker local currency in other markets have impacted our Consumer channel overall.

“In our Ingredients channel, we’re seeing margins in our longer-term pricing contracts return to more normal levels, which has helped push Total Group gross margin up from the last quarter last year.

“We continue to see the benefit of our focus on financial discipline with lower interest expense, and operating expenditure down 2% on the same quarter last year.

“Looking at the whole picture, I’m proud of what we’ve achieved. With EBIT of $190 million and a strong Farmgate Milk Price, we are starting to consistently deliver solid commercial outcomes.”

Outlook

While the impacts of COVID-19 continue to be felt around the world, Mr Hurrell says the Co-op is working hard to deliver for farmer owners, unit holders and customers and supporting employees.

“The resilience of our people and our supply chain means we continue to stay on top of the strong demand for our New Zealand milk.”

“However, it is concerning to hear about new variants, which are potentially more resistant to vaccines. There is also the ongoing question of whether economies can rebound from the pandemic and then sustain their financial health.

“That’s why we have a 60-cent range on our forecast Farmgate Milk Price range.”

Supporting our people

Globally, teams are starting to return to the office following extended COVID-19 lockdowns. Mr Hurrell says it’s been a challenging time for employees.

“In some of our regions, our people have spent more than 18 months working from home. We’ve supported them during this time and continue to support their safe return to the office. I want to acknowledge the extra effort from our employees that is helping us deliver good results for the Co-op.

“Here in New Zealand, we recently completed the rollout of our vaccination programme in partnership with the Ministry of Health, which saw more than 8,000 doses administered.”

Path to 2030

Fonterra set out the next phase of its long-term strategy in September, with three key strategic choices guiding the Co-op – a continued focus on New Zealand milk and to lead in sustainability and dairy innovation and science.

Mr Hurrell says the Co-op is confident in its strategy and 2030 targets and is already showing early signs of progress.

“As we continue to focus on New Zealand milk, work is underway on the divestment of our Chilean business and the ownership review of our Australian business, with the appointment of advisors to assist with both processes. Dependent on the outcome of these processes, we intend to return around $1 billion of capital to our shareholders and unit holders by FY24.

Mr Hurrell says the focus on New Zealand milk is paying off with customers. “We recently launched our Mainland cheese range in Dubai’s largest supermarket chain. The range completely sold out, with customers using social media sites to track down the cheese in-store. Our in-region team is now looking at launching the range into other countries.

“We’re also focused on delivering innovative new solutions for our customers. Our new Ingredients ecommerce platform, myNZMPTM, is being embraced by customers across China, Latin America, South East Asia and the Middle East.”

Mr Hurrell says the Co-op is also using innovative technology to make the most of the natural goodness found in our New Zealand dairy.

“A transformative dairy science collaboration with Vitakey will explore how we can further unlock the benefits of our probiotic strains. Our goal is to design dairy products that incorporate targeted and time-controlled release of specific dairy nutrients in a way that locks in the freshness for longer and allows the nutrients to be more active and beneficial in the body.”

New Zealand is already the most carbon-efficient dairy producing nation on the planet and Mr Hurrell says the Co-op is making strides in its intention to retain a significant advantage by being a leader in sustainability.

“By treating water at our Maungatūroto site using a natural wetland, we can reduce water use on site by up to 25%. On-farm, we’ve just introduced Farm Insights Reports, which give farmers a comprehensive picture of their overall farm from an environmental performance and animal health perspective. This enables them to focus on the improvements which will have the biggest impact.

“We’re also working to find a solution to the challenge of on-farm emissions and one of the exciting projects we’ve been working on is Kowbucha™, a probiotic which could switch off the bugs that create methane in cows. Initial results have been promising, showing a reduction of up to 50% in methane, and we’re now at the stage of trialling it on farm.

“This is just some of the great work underway in the Co-op that will enhance our New Zealand sustainable nutrition story.”

This isn’t just good news for farmers, it’s good news for the economy, especially when tourism, which was one of the country’s biggest foreign exchange earners, has been hit so hard by closed borders.


Rural round-up

27/10/2021

Fonterra increases 2021/22 forecast farmgate milk price :

Fonterra Co-operative Group Limited today increased and narrowed its forecast Farmgate Milk Price range to NZD $7.90 – $8.90 per kgMS, from NZD $7.25 – $8.75 per kgMS.

The midpoint of the range, which farmers are paid off, has increased to NZD $8.40 per kgMS, from NZD $8.00 per kgMS.

Fonterra CEO Miles Hurrell says the lift in the 2021/22 forecast Farmgate Milk Price range is a result of continued demand for New Zealand dairy relative to supply.

“At a $8.40 midpoint, this would equal the highest Farmgate Milk Price paid by the Co-op, and would see almost $13 billion flow into regional New Zealand through milk price payments this season. . .

New research highlights NZ beef’s differences :

Pasture-raised beef is a cornerstone of the New Zealand meat industry.

However, it is not clear if it is understood the benefits consumers get from the meat when it is raised this way.

New research from the Riddet Institute indicates there are differences in meat quality relating to health and digestion, depending on how the animal is raised.

A Massey University research team led by Dr Lovedeep Kaur and Dr Mike Boland compared the digestion differences between pasture-raised New Zealand beef to grain finished beef and a plant-based alternative. . .

Game deer donated to Kai Rescue charity in Nelson – Samantha Gee:

A  call to manage a population of deer on private land in Nelson has led to a donation of venison to a food rescue programme.

New Zealand Deerstalkers Association Nelson branch committee member David Haynes said a managed hunt was undertaken in order to sustainably manage the number of animals on a recreational property at the request of the landowners.

“They came to the Nelson Deerstalkers to say they’re having problems with some pigs rooting up the ground and damaging some tracks there along with other animals and asked us if we could come in and try and sort of manage those two more sustainable levels.”

Branch president Greg Couper and committee member Carina Jackson culled the deer along with goats and pigs. . . 

New Zealand agritech companies attracting millions of dollars :

New Zealand agritech companies are attracting millions of dollars of investment, proving that Covid is not stopping significant business activity, AgriTechNZ chief executive Brendan O’Connell says.

Aotearoa agritech is seeing remarkable progress in new global partnerships, collaborations, investments and team growth.

A surge of company announcements from around the country support the sector focus exemplified in New Zealand’s agritech industry transformation plan. It feels like fertile ground for a burst of growth in 2022 and beyond, he says.

“Dunedin’s AbacusBio has just announced their deepening relationship with Bayer Crop Science, in the area of predictive plant breeding. . . 

NZ canned win exports set for multimillion dollar growth:

One of New Zealand’s largest exporters of canned wine has launched a multimillion-dollar expansion into North America as its share of the global small format wine market grows.

The move by the Wairarapa winemaker into the lucrative US market, follows an approach from $16bn retail chain Wholefoods after a win in a major canned wine competition.

The international market for canned wines is growing at a rate of 13% per annum and is projected to reach over $807m by 2028. In contrast, the bottled wine category remains stagnant with a growth rate of 4%.

The wine industry has struggled to attract millennials and small format options are increasingly being seen as a mechanism to deliver a more portable, environmentally friendly and portion-controlled product for this health-conscious segment. . . 

Could our national fungus become the blue food dye of the future? – Olivia Sisson :

Aotearoa’s very own werewere kōkako could be the secret to all-natural Powerade, blue jelly beans and even the elusive blue Froot Loop. Olivia Sisson speaks to a scientist trying to make it happen.

Blue food is having an absolute moment.

From the rise of blue spirulina smoothie bowls and blue rice to the resurgence of Blue Hawaii cocktails –  eating aqua is in.

A few months ago @shityoushouldcareabout brought a blue food inequity to the fore: New Zealanders are missing out on blue Froot Loops. The American version of the cereal contains orange, green, purple and blue loops.  . . 

 

Cow manure makes DRINKABLE water after scientists turn the animal feces into a filter that removes salt from seawater – Stacy Libertore:

Cow manure may be used largely for fertilizing, but some researchers are using it to turn seawater into freshwater.

Scientists at Northeastern University developed a process that turns the bovine feces into a filter that purifies otherwise undrinkable water – an innovation the team hopes can address the global water crisis.

By blasting the manure with intense heat, scientists broke it down to a carbon powder that was made into a foam. 

The foam floats on the seawater’s surface and when sunlight hits the area, water beneath the black material turns to steam and passes through it as drinkable liquid. . . 


Rural round-up

15/10/2021

Investors see promising signs of recovery in infant formula sales in China – Point of Order:

After  a  rough  ride  since  Covid-19  struck, the New Zealand economy  is  in   better   shape   than might  have been  predicted  at the  onset  of the  pandemic.  Yet labour  shortages,  an energy crisis  in Europe  and  China, and  massive  inflationary  pressures suggest  that  the  passage  ahead   will  be  anything  but  smooth.

With  the  government abandoning  the  elimination  strategy  and  moving  towards  living  with  endemic  Covid, the  country  is adjusting  to  the  prospect  of  a  new  normal.  But  without  any  sign of  the  number of  cases  of the Delta  variant  diminishing, restrictions  may  persist  for  longer  than  might  have been  imagined  just  weeks  ago.

It’s  a  blow  to  industries  looking  to  inflows  of  workers  to ease  labour  shortages, particularly  in the  rural  regions,  which  last  season  sustained  the  economy  with  the  production of  commodities  that  were  in  relatively  tight  supply  in  world markets,  fetching excellent  returns. . .

Anchor Food Professionals reaches $3bn in annual revenue :

Anchor Food Professionals – Fonterra’s foodservice business – has defied Covid challenges to become a $3 billion annual revenue business.

Fonterra says the milestone was pleasing, despite restaurants around the world being affected by Covid-19.

Chief executive Miles Hurrell said the success was down to the the co-op’s strong connection to customers.

“Our people have worked hard to find new ways of working with customers and new product applications to suit the pandemic environment, and we can see this has been a success. . .

Kiwifruit growers take Gisborne District Council to High Court over land valuation method – Alice Angeloni:

Kiwifruit growers are taking Gisborne District Council to the High Court for including the licence to grow the gold variety in rating land valuations.

The national body representing growers, NZ Kiwifruit Growers Incorporated (NZKGI), has brought a judicial review proceeding of the decision to the High Court, and is supporting a grower on Bushmere Road, who has lodged an objection to their property valuation before the Land Valuation Tribunal.

Gisborne was the first region to adjust land valuation methods to include the value of the gold kiwifruit growing licence, known as the G3 licence, on the rateable value of the property.

The move has resulted in a rates hike Gisborne growers called “absurd” and inequitable, with reports of rates tripling for some. . .

A farming mystery hits social media – Vincent Heeringa:

Regenerative farming: only one person knows what it means (and it’s not you), writes Vincent Heeringa, but it is vital that it becomes known and understood

A new report by Beef and Lamb NZ sheds fresh light on the role that regenerative farming could play in growing our primary sector exports. The news is encouraging. Conducted by US food researcher Alpha Food Labs, the report shows that ‘conscious consumers’ in Germany, the UK and the US have a strong appetite for sustainable foods – and are even hungrier for foods labelled regenerative.

“After learning about the benefits of regenerative agriculture, the proportion of consumers willing to pay 20 percent or more increased in the United Kingdom and Germany, as well as the proportion willing to pay substantially more (i.e. 30 percent more) at least for the United States and Germany.” . . .

New Zealand pork tackles common misconceptions about pork nutrition :

As World Iron Awareness Week comes to a close, New Zealand Pork is reminding Kiwis of the many benefits of enjoying New Zealand pork as part of a healthy balanced diet.

“There are several misconceptions about pork, so this campaign has been designed to bust a few myths and give consumers simple easy facts around some benefits of enjoying delicious New Zealand pork in their diet,” says New Zealand Pork’s nutrition advisor Julie North of Foodcom.

“Some people believe all pork is a fatty meat, thinking of a pork roast with a thick layer of crackling or a juicy pork belly. However, most cuts of pork are quite lean when the external fat (which is easy to remove) is cut off. By trimming off the outer layer of fat, New Zealand pork is quite a lean meat.” . . 


Rural round-up

10/10/2021

Why NZ should get behind Miles Hurrell as he aims to broaden Fonterra’s product range – Point of Order:

  New Zealand moves  towards  reconnecting with the world,  62%  of  the   business  leaders  surveyed  in the  NZ  Herald’s “Mood  of the  Boardroom”  say  they are not  satisfied with the government’s  plan  for  reopening the country.  International business is  being  lost due to border difficulties.

So  the  NZ economy  again looks likely to be propped  up by the primary  sector. On  that  front, the  news  is  positive.  International markets  are  exhibiting  strong  demand  for our products,  with the  result  that export  prices  are even more  buoyant  than  seemed  likely   just  three  months ago.

Lamb is  fetching   record  prices   and  dairy,  despite  some  earlier predictions that global production  would  push  down prices, has  moved  in  the  other  direction,  to  the  extent   that Westpac senior  agri-economist  Nathan  Penny   this  week  raised  his  forecast  for  Fonterra’s farmgate  milk price this  season  by  75c  to $8.50kg/MS.  That would surpass the co-operative’s previous record high of $8.40kg/MS paid in the 2013/14 season. . . 

 

Farmers, breeders rue lost chance to showcase stock at Canty A&P Show – Sally Murphy:

The animal showing circuit has been left devastated by the cancellation of the Canterbury A&P show.

Organisers of the country’s largest A&P show made the decision today to cancel next month’s event.

It’s the second year the show has been cancelled due to Covid-19 restrictions.

The show which attracts about 100,000 people over three days is the main showing event for many farmers and breeders around the country. . .

Demand for Asian greens ramps up by up to 400 percent in recent years, grower says – Sally Murphy:

A Levin vegetable grower says demand for Asian greens has increased by nearly 400 per cent in the last couple of years.

Woodhaven Gardens has grown some asian greens for about 20 years but ramped up plantings four years ago after seeing growing demand in the market.

Company director Jay Clarke said they grew Shanghai bok choi, pak choi, wombok or chinese cabbage, saigon turnip and coriander.

“We started with some trials and things have really taken off, we’ve seen some of our traditional lines coming back in volume and becoming less popular things like green cabbage and iceberg lettuce but the shanghai bok choi, wombok and saigon turnip have really grown in popularity,” Clarke said. . . 

Blue Sky Pastures delivers improved performance  amidst tough trading conditions :

A year of significant challenges across the red meat sector has not dampened the performance of southern meat processor Blue Sky Pastures, delivering an improved performance on the previous year with the release of its 2021 Annual Report.

In the 12 months to 30 June 2021, the business generated a profit of $5.3 million before tax, an increase on 2020’s $4.2m. It resolved to pay a dividend of 5 cents per share.

Blue Sky Pastures CEO Jim Goodall, having stepped into his new role at the beginning of July, said the result was pleasing, given the 2020 year had been a 15-month season. . . 

LIC sustainability report:

Livestock Improvement Corporation (LIC) has published its first Sustainability Report.

In the report, LIC Chairman Murray King says unlike other companies that can only make a difference through the business choices they make, LIC is able to do some of the heavy lifting on sustainability for the industry too.

In addition to meeting LIC’s annual reporting requirements as a member of the Sustainable Business Council, the report demonstrates how LIC is responding to sustainability challenges facing New Zealand dairy farmers and the critical role it plays in helping them meet their own sustainability goals. . . 

Peter Russell becomes 2021 Marlborough Young Winemaker of the Year :

Congratulations to Peter Russell from Matua Wines for becoming the 2021 Tonnellerie de Mercurey Marlborough Young Winemaker of the Year.

Peter was defending the title so was delighted to win the Marlborough competition for a second year in a row. He will now focus on taking out the national title when he competes against finalists from Central Otago and the North Island at the National Final which will be held later in the year.

“I’ve received lots of messages from other contestants and members of the wine industry and I feel grateful to be part of a such a supportive community” says Peter “I’m extremely looking forward to taking part in the national final.” . . 


Rural round-up

24/09/2021

The ETS is both a gold mine and a minefield – Keith Woodford:

The Government never foresaw the land-use forces they were unleashing with the ETS

In recent weeks I have written multiple articles on the Emission Trading Scheme (ETS) with a particular focus on forestry. This week I also had an extended interview with Kathryn Ryan on RNZ ‘Nine to Noon’.  However, there is still lots more that needs to be said.

The bottom line is that carbon forestry is now far more profitable than sheep and beef farming on nearly all classes of land. We are indeed on the cusp of the greatest rural land-use changes that New Zealand has seen in the last 100 years.

For many sheep and beef farmers, carbon farming can now be a gold mine. The key requirement is pastoral land that will grow an exotic forest that will not be destroyed by storm, fire or disease.  . . 

A new visa scheme offering 3 years in Australia to agricultural workers threatens to crush NZ’s primary sector – Aaron Martin:

Australians must be laughing at our immigration woes.

The Australian government has announced a new visa aimed at enticing agricultural workers by offering them three years of residency to live in rural areas. New Zealand, however, has no official pathway or plan for migrant worker residency.

Why is the Ardern government consistently the loser?

We have very proud history of sporting success against Australia. We love nothing better than to beat them at anything. We’ve had success on multiple fronts but, sadly, our government seems to come up the loser against theirs. . . 

The human cost of no response :

The Prime Minister’s ‘Be Kind’ message is obviously struggling to get past Wellington’s 50k boundary and out to Rural New Zealand.

You can tell because, if there was any response from her or her ministers to the concerns Rural NZ has, I’d know. To date, the tally is 0.

As both a farmer and National’s Agriculture spokesperson I find it deplorable.

The heavy-handed approach the Government has adopted in trying to reach unrealistic, impractical targets for water, climate change, zero carbon, emissions and land use, to name but a few, has placed enormous pressure on the farming sector. . .  

Fonterra completes reset, announces annual results and long-term growth plan out to 2030:

Fonterra Co-operative Group Limited today announced a strong set of results for the 2021 financial year, reflected in a final Farmgate Milk Price of $7.54, normalised earnings per share of 34 cents and a final dividend of 15 cents, taking the total dividend for the year to 20 cents per share. The results come as Fonterra moves through its business reset and into a new phase of growing the value of its business.

CEO Miles Hurrell says the last three years have been about resetting the business. “We’ve stuck to our strategy of maximising the value of our New Zealand milk, moved to a customer-led operating model and strengthened our balance sheet.

“The results and total pay-out we’ve announced today show what we can achieve when we focus on quality execution and an aligned Co-op.

“I want to thank our farmer owners and employees for their hard work and commitment over the last few years that has got us to this position. Together, we’ve shored up foundations and done this despite the challenges of operating in a COVID-19 world.

“Although the higher milk price and tightening margins put pressure on earnings in the final quarter, this is a strong overall business performance, allowing us to deliver $11.6 billion to the New Zealand economy through the total pay-out to farmers. . . 

Hawke’s Bay A&P show cancelled over Delta risk fears – Maja Burry:

The Hawke’s Bay A&P Show, due to be held late next month, has been cancelled due to the uncertainty and risks associated with the Covid-19 Delta outbreak.

Organisers said the executive committee of the Hawke’s Bay A&P Society met last night to review the risks and after significant consideration, made the hard decision to cancel.

The show was scheduled to run from October 20th-22nd. It’s one of the largest in the country and usually attracts 30,000 people to the Tomoana Showgrounds.

Society president Simon Collin said whilst the country was in differing levels of restrictions, and with Covid-19 cases still appearing the country, the event couldn’t go ahead. . . 

Scientists aiming to enhance the `human-ness’ of infant formula

AgResearch scientists think they have identified a unique new way to make infant formula more like breast milk and better for babies, using ingredients that could enhance brain development and overall health.

Research into this next generation infant formula could create new opportunities for New Zealand’s primary industries in a global market worth tens of billions of dollars annually.

With funding over three years recently announced from the government’s 2021 Endeavour Fund, AgResearch scientists Simon Loveday and Caroline Thum, along with collaborators from Massey and Monash Universities, are aiming to enhance the “human-ness” of infant formula produced from New Zealand ingredients.

“We’ve recently discovered a new natural source of nutritional oil that is surprisingly similar to the fat in breast milk,” Dr Thum says. . . 

Demand for NZ apples in India continues to grow – Sally Murphy:

An apple exporter says efforts to grow demand in India are proving fruitful with orders skyrocketing.

Although they only make up a small proportion of total numbers, exports of pip fruit to India have been growing.

Ministry for Primary Industries figures show last year 5.5 percent of apple and pear exports went there, but to July this year exports to India made up 8.2 per cent.

Golden Bay Fruit in Motueka has been exporting apples there for over 20 years. . . 

 


Rural round-up

10/05/2021

Fonterra boss Miles Hurrell says turning around the dairy giant has not been smooth sailing – Tina Morrison:

Fonterra chief executive Miles Hurrell faced a daunting task when he was asked to take the helm of the country’s largest company in 2018, but he is getting the dairy giant in shape.

The co-operative owned by its 10,000 farmer suppliers and supporting some 20,000 employees was heading for its first annual loss since its creation in 2001 after a period of big expansion failed to deliver the promised profits and left it saddled with too much debt.

Hurrell, an 18-year veteran of Fonterra and head of the Farm Source unit that worked with farmers, talked with his wife and a few close friends who backed him to take on the challenge of what was looking like a tough couple of years.

“I was under no illusion at that point in time about what needed to be done,” he says. “Clearly we needed to go about doing things differently.” . . 

Living the good life after ‘bovis’– Sally Rae:

It’s been a roller-coaster ride for South Canterbury farmers Kelly and Morgan Campbell since their cattle were the first in New Zealand to be depopulated due to Mycoplasma bovis. But they have come out the other side with a new business venture. Business and rural editor Sally Rae reports.

On a lifestyle block in rural South Canterbury, Kelly and Morgan Campbell are living the good life.

Residing in their dream home, surrounded by hundreds of happy hens, their seemingly idyllic existence belies the roller-coaster ride they have lived the past few years.

Morgan Campbell arguably summed it up best by saying: “it’s a crazy story … with lots of kinks and curves … along the way. Dead cows, IVF and chickens.” . . 

Sheep numbers plummet by 800,000 in a year – Esther Taunton:

New Zealand’s sheep numbers plummeted by almost a million in 2020, new data shows.

Figures from Stats NZ put the sheep population at 26 million for the year ended June 2020, a fall of 800,000 from the previous year and a far cry from the peak of 70 million sheep in 1982.

Stats NZ agricultural production statistics manager Ana Krpo said widespread drought conditions and feed shortages were a major factor in the 3 per cent fall.

“Hawke’s Bay had the largest decrease, with the total number of sheep falling by 12 per cent (346,000) from the previous year to a total of 2.5 million as at June 2020.” . . 

Too many customers, not enough grapes, Marlborough winemakers struggling to match demand – Hugo Cameron:

Key export markets are thirsty for Marlborough wine, but low grape yields mean that demand is outstripping supply.

Frost and cold weather early in the season led to smaller harvests from many vineyards in the area and the smaller crop could leave some wineries facing tough decisions on who they can supply over the next year, industry group Wine Marlborough says

Caythorpe Family Estate owner Simon Bishell said the grape yield was about 25 to 30 percent down on the normal volume.

The business had seen plenty of fresh interest, but supplying those new customers after a slim harvest was a challenge, Bishell said. . . 

100 years on the land – Shawn McAvinue:

The Frame family recently celebrated 100 years of farming Burnbank in Teviot Valley. Shawn McAvinue talks to Bill and Gwenda Frame about how four generations have transformed the land from an unfenced block covered in gorse and rabbits to a productive sheep and beef farm.

A blanket of snow covered the land when Bill Frame was born on the sheep and beef farm Burnbank in Teviot Valley, on New Year’s Day in 1932.

When the snow melted, rabbits covered the farm in Dumbarton, near Ettrick.

As the baby boy grew, so did the rabbit population, and a dream was born. . . 

Meet challenges head-on says Beef Achiever Tracey Hayes – Shan Goodwin:

IF there is piece of advice Tracey Hayes believes has the power to guarantee a prosperous future for every sector of Australia’s beef industry, it’s the idea of never shying from a challenge.

Don’t turn a blind eye to what’s difficult, regardless of how insurmountable it may appear. Instead focus on precisely that.

These were the words from Ms Hayes after she was named the 2021 Queensland Country Life Beef Achiever at Beef Australia in Rockhampton last week.

Ms Hayes is an agribusiness executive with a beef production background and a down-to-earth persona that has made her one of the most liked, and respected, identities in the cattle game. . . 


Rural round-up

07/04/2021

Horticulture collapse fears unless Pacific Island workers allowed in – Shawn McAvinue:

A group of Teviot Valley orchardists is calling for the Government to allow more Pacific Islanders to return to the region to fill a labour shortage before the horticulture industry “collapses”.

Darlings Fruit owner Stephen Darling, of Ettrick, said the apple harvest season runs from the end of February to mid May.

He had only about 60% of the 65 pickers and packhouse staff required for the season on his family’s about 90ha of orchard blocks in the valley.

Consequently, apples would rot on the ground this season, he said. . .

Plan change mooted to limit carbon farming – Ashley Smyth:

Attempts are being made by the Waitaki District Council to rein in carbon farming, following public concern over a recent farm sale.

A report presented at a council meeting on Tuesday, suggested a district plan change under the Resource Management Act.

This would allow the council to move independently of the tight timeframe set by the release of the draft district plan review.

It is expected some new areas of outstanding natural landscape, significant natural areas, geological sites and visual amenity landscapes will be included in the plan. . .

Native planting project hoped to protect Tolaga Bay from logging debris–  Maja Burry:

Every time heavy rains hits Uawa – Tolaga Bay, a sense of nervousness washes over the community that a fresh delivery of forestry slash could be brought down from the hillsides.

After years of discussions, it’s hoped a native planting project announced by the area’s largest forestry operation will help protect homes, waterways and coastlines.

Aratu Forests, one of New Zealand’s 10 largest freehold forest plantations, has announced a 90-year ‘right to plant’ land management agreement with sustainable land-use company, eLandNZ – with the backing of the Gisborne District Council.

The programme will see permanent native plantings established in parts of the 35,000 hectare estate which are unsuitable for timber plantation. . .

Horticulture industry can help New Zealand reduce emissions and grow the economy:

The horticulture industry is well placed to help New Zealand reduce its emissions while also enabling the economy to grow, Horticulture New Zealand says. 

‘Our fruit and vegetable growing industry is already environmentally responsible as well as being one of the most efficient in the world,’ says HortNZ President, Barry O’Neil. 

‘In our submission to the Climate Change Commission, we pointed out that horticulture is now producing more food from less land, using fewer inputs like fertiliser and water. 

‘Covid has seen demand for healthy food increase, across the world.  This increase puts horticulture in a win/win situation.  Land-use change to horticulture will reduce emissions from the agriculture sector, while the extra production will find ready markets, overseas and locally.’ . . .

Fonterra completes sale of two China farms:

Fonterra has today completed the sale of its two wholly owned China farming hubs in Ying and Yutian

As announced in October 2020, the sale of the farms to Inner Mongolia Youran Dairy Co., Ltd (Youran) was subject to anti-trust clearance and other regulatory approvals in China. These approvals have now been received.

The transaction proceeds comprise the original sale price of NZD $513 million plus NZD $39 million in settlement adjustments, giving cash proceeds of NZD $552 million*.

CEO Miles Hurrell says the completion of the sale is an important milestone for Fonterra following its strategic refresh. . .

Treating soil a little differently could help it store a lot of carbon – Natasha Geiling:

Climate change is a massive problem with the potential to completely reshape the world, both literally (with rising sea levels and melting glaciers) and figuratively (with the way we grow food, or the way that we handle allergies). And while the consequences caused by climate change could be huge, the solutions — transitioning to a completely fossil fuel-free economy, or geoengineering — can often seem equally daunting.

But what if something as simple as the dirt under your feet could help mitigate some of the worst of climate change? The Earth’s soils contain a lot of carbon, and helping to manage and restore them could be a key way to help tackle climate change, according to a recent study in Nature.

Soils are already huge stores of carbon, and improved management can make them even bigger

The study, published by a group of international scientists, suggests that using “soil-smart” techniques for soil management could sequester as much as four-fifths of the annual emissions released by the burning of fossils fuels. These techniques include planting crops with deep roots, which help keep soil intact and encourage the growth of microbial communities that help trap soil carbon, and using charcoal-based composts. The study also calls for a wider adoption of sustainable agriculture techniques — things like no-till farming, which involves growing crops from year to year without disturbing the soil and has been shown to potentially help soil retain carbon, and organic agriculture, which also has shown some promise in restoring and maintaining soil health. . .


Dairy delivers again

05/03/2021

Good news from Fonterra:

Fonterra Co-operative Group Limited today lifted its 2020/21 forecast Farmgate Milk Price range to NZD $7.30 – $7.90 per kgMS, up from NZD $6.90 – $7.50 per kgMS.

The midpoint of the range, which farmers are paid off, has increased to NZD $7.60 per kgMS.

Fonterra CEO Miles Hurrell says the lift in the 2020/21 forecast Farmgate Milk Price range is a result of consistent strong demand for New Zealand dairy.

“We’ve seen Global Dairy Trade (GDT) prices continuing to increase since February when we last updated on our forecast Farmgate Milk Price and then this week there was the 15% increase in GDT prices.

“It’s very much a China demand led story but there is also good demand for New Zealand dairy across South East Asia and the Middle East.

“China’s strong economic recovery, following the initial impact of COVID-19, is flowing through to strong demand for dairy and we’ve seen this through sales during the Chinese New Year.

“China’s local milk supply is being used in fresh dairy products and they are looking to us to provide longer-life dairy products – in particular, whole milk powder which has a big influence on the forecast Farmgate Milk Price.

“Customers know we are continuing to get products to market, despite the challenges in the global supply chain and they are looking to us for this reliability. We’re also seeing customers want to buy more of our products than usual to help mitigate the risk of global supply chain delays.”

Hurrell says today’s lift in the Co-op’s forecast Farmgate Milk Price is good news for New Zealand farmers and the wellbeing of rural communities. It would see the Co-op contribute more than $11.5 billion to the New Zealand economy through milk price payments this year.

But before we get too excited:

Fonterra has decided to maintain its plus or minus 30 cent range on its forecast Farmgate Milk Price, reflecting the continued uncertainties in the global dairy market.

Hurrell says it is important that farmers recognise there are a number of downside risks to the mid-point of the range. For example, the EU and US are heading into their season and their milk supply will start increasing, the impacts of COVID-19 on key markets and market volatility.

“A $7.60 per kgMS forecast Farmgate Milk Price also increases our input costs putting further pressure on our earnings in the second half of the 2020/21 financial year. More details on our earnings will provided at our half year results on 17 March.”

 


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