Rural round-up

February 16, 2016

Surviving the dairy downturn – Keith Woodford:

In recent weeks the short term dairy outlook has turned from bad to awful. Fonterra’s recently revised milksolids price estimate of $4.15 for the current 1015/16 season has already been overtaken by events, and is once again looking decidedly optimistic.

I now see a figure of about $3.90 as being more likely, but still with plus or minus 40c around that. Even more important, no longer can we ignore the likelihood that dairy prices are going to stay low for at least the first half of the 2016/17 dairy season, and possibly for all of that season.

Most but not all of the farmers I have contact with are going to come through relatively unscathed. But that is not the case for those who have both high costs of production and high debt. We are now facing a situation which New Zealand farmers have not faced since the 1980s. . . 

Broker warns average dairy farmer may lose $140k this season – Edwin Mitson:

(BusinessDesk) – Financial broker OMF is warning the average New Zealand dairy farmer is likely to lose $140,760 this season, with next year looking just as grim.

In its monthly New Zealand dairy report OMF suggests there is a further risk that Fonterra Cooperative Group could lower payouts again, pointing to a potential milk price of $3.89 per kilogram of milk solids. Fonterra lowered prices on Jan. 28 to $4.15/kgMS. OMF estimates the current cost of production is $5.31/kgMS.

OMF said dairy farmers are likely to face a third season of weak prices, with many becoming increasingly reliant on credit lines and vulnerable to a shift in banks’ willingness to “extend and pretend” loans are going to be repaid. DairyNZ estimates 85 percent of dairy farmers will make a loss this season compared to 49 percent last season. . . 

Seafood exports reach $1.63 billion:

New Zealand seafood exports reached a record high of $1.63 billion last year, up over 6 per cent on 2014.

The growth was most pronounced in the final two months of the year, says Chief Executive Tim Pankhurst.

Up to the end of October export growth was tracking at about 3 per cent but increased demand in November and December pushed the growth to over 20 per cent for those two months and lifted total growth for the year to 6.6 per cent. . . 

Ex-deer farmers drawn back by strong returns:

Deer farmers who left the industry for brighter pastures in dairy are being drawn back by strong returns for venison and velvet, a south Canterbury deer farmer says.

Kris Orange farms 1600 weaner deer on 260 hectares in Geraldine, South Canterbury and 1000 hinds on a farm at Dunback, Otago.

He said venison prices were up more than $1 on last year’s returns, sitting at about $7.20kg, with expectations of strong growth in the next five to 10 years. . . 

Four finalists named for IrrigationNZ’s Innovation Award:

For the second time – IrrigationNZ has shortlisted four finalists for its ‘Innovation in Irrigation Award’ sponsored by Aqualinc – which will be presented at the organisation’s biennial conference in early April.

New technologies, products, practices or community collaborations that reflect innovation within the irrigation sector are the focus of the award, which is only presented every second year.

IrrigationNZ CEO Andrew Curtis says the external judging panel had struggled to keep the shortlist to the normal three, so four finalists have been chosen this year. . . 

Beef + Lamb New Zealand making global connections:

Beef + Lamb New Zealand teamed up with Le Cordon Bleu New Zealand Institute (LCBNZ) recently to host six chefs from China – winners of the global “Chef par Excellence” culinary competition.

The institute and Sealord New Zealand were the main sponsors and Beef + Lamb New Zealand (B+LNZ) was invited to arrange a day’s activity for the chefs.

B+LNZ General Manager Market Development Nick Beeby says the opportunity was too good to pass up, particularly given the group’s influential travel members. . . 

SealesWinslow mills receive quality stamp:

SealesWinslow has attained FeedSafeNZ accreditation across all of its mills, recognising the high quality of the animal feed products they make.

FeedSafeNZ is a quality stamp from the New Zealand Feed Manufacturers Association (NZFMA) for manufacturers and blenders, designed to enhance the quality assurance of stockfeed. . . 

Synlait Strengthens Senior Team to Drive Value Growth And Business Performance:

Three new senior management positions will add business development and process improvement capability to Synlait’s Senior Leadership Team.

Managing Director and CEO John Penno said the decision follows an assessment of business areas that require additional focus to ensure the company continues to deliver against its growth aspirations.

“Building our business development capability will significantly improve our ability to take advantage of emerging opportunities that will accelerate our growth,” said Mr Penno. . . 

 


Rural round-up

July 23, 2015

Potential for dairy farmers to increase income from calves:

In a welcome departure from dismal news on the dairy front, farmers are being told that a simple change to their herd mating plans could increase their income from calves.

The advice is one outcome from the Beef + Lamb New Zealand Dairy Beef Integration Programme which is looking at the impact of using good beef genetics in a dairy beef supply chain.

The aim of the AgResearch managed research is to confirm the impact the strategy could have for dairy farmers and others in the supply chain. Early results show clear advantage – and potential additional profit – to dairy farmers from the use of proven beef genetics. . .

 Tiny mite a buzzkill for NZ’s wasps: – Nick Butcher:

A Landcare Research scientist says a tiny mite found on the back of wasps could be helping control the spread of the pests, which sting the country’s primary industries by about $130 million a year.

Wasps also pose a hazard to people and harm the native bird population by competing with them for food, including honeydew and other insects.

Dr Bob Brown discovered the unnamed mite in 2011. He said his studies showed wasp nests infested with the mites were 50 to 70 percent smaller than uninfested nests. . .

Efforts continue to get to the bottom of NAIT puzzle – Allan Barber:

The saga continues, as my Warkworth friend attempts to find out how NAIT intends to ensure correct reconciliation of livestock records, but as yet without a totally satisfactory answer. After further contact, NAIT’s acting Group Manager Sam McIvor replied with answers to the main points raised and I understand the conversation will continue, as both parties try to convince the other of their respective point of view.

At its most basic, the debate centres round the issue of ensuring 100% accuracy which is only possible, if there is 100% retention of tags at the time of stock movement or every animal has a second or reserve tag. At present NAIT estimates there is 98% retention. My friend who came through the mad cow disease disaster as well as FMD outbreaks in the UK is adamant the only acceptable position is 100% accuracy in the event of a disease outbreak. . .

Duncan Coull New Shareholders’ Council Chairman:

Duncan Coull has been elected unopposed to the position of Chairman of the Fonterra Shareholders’ Council.

Mr Coull was first elected to the Council in 2010 to represent Fonterra Farmers in Otorohanga and served as the Council’s Deputy Chair for the past 12 months.

Mr Coull: “It is a privilege to be elected to lead the Council and I thank Councillors for the support I continue to receive. . .

 New Zealand Kiwifruit Growers Incorporated Annual General Meeting:

New Zealand Kiwifruit Growers Incorporated (NZKGI) held its Annual General Meeting today, Wednesday 22 July 2015, updating growers on its key projects and reflected on a successful year.

NZKGI President, Neil Trebilco, says grower confidence and orchard values have continued to increase over the last twelve months.

“The main factors in this increasing optimism are the reduced effects of Psa and increasing OGRs per tray, particularly for Green. . .

 

Dairy farm prices stalling, lifestyle blocks strong, REINZ data shows – Fiona Rotherham:

(BusinessDesk) – Farm sales are down 9 per cent in the year to June and dairy farm prices have begun a slight downward trend, according to the latest Real Estate Institute of New Zealand data.

There were 62, or 11.5 percent, fewer farm sales for the three months ended June, compared to the same period a year ago and the overall year to date is down 9 percent to a total of 1,737 farms sold.

The median price per hectare for all farms sold in the three months to June was $29,141, compared to $26,634 in the same period the previous year, up 9.5 percent. But the All Farm Price Index, which adjusts for differences in farm size, location and farming type, rose by just under 1 percent in June compared to the same month in 2014. . . .

Expert’s visit fruition of relationship cultivation:

Feijoas and Kiwifruit have been on the menu as Lincoln hosted a plant specialist recently to initiate closer working ties around food production with a Chinese province of 90 million people.

Feijoa expert Dr Meng Zhang, of Southwest University of Science and Technology (SWUST) in Sichuan Province, spent a month with Lincoln University and the Bio-Protection Research Centre (BPRC) at Lincoln specifically to learn more about New Zealand horticulture production systems, biological protection and bio-control.

The visit comes a few months after SWUST’s President, Jun-bo Wang, and Director Guan-zhi Zhang, were in Lincoln as part of a large Sichuan trade delegation intended to further extend co-operation between the two institutes. . .

 

Weaker New Zealand Dollar Helps Wool Prices:

New Zealand Wool Services International Limited’s General Manager, Mr John Dawson reports that the weakening New Zealand dollar helped local prices this week with most types increasing by the corresponding currency change.

The weighted indicator for the main trading currencies was down 2.04 percent compared to the last sale on 9th July.

Of the 7,900 bales on offer from the South Island, 88 percent sold with types suitable for in the grease shipments coming under strong competition. . .

New production quality accreditation for animal feed:

New Zealand animal feed manufacturers now have a quality of production accreditation.

FeedSafeNZ is a new accreditation available to New Zealand Feed Manufacturers Association (NZFMA) members who pass independent audit standards as to quality of feed production. The FeedSafeNZ accreditation has two main aims: to provide safe feed for animals and thereby to protect the safety of human food.

Michael Brooks, NZFMA Executive Director says, “High quality feed is vital not only for the health and wellbeing of animals but also for humans, so it’s imperative that feed is manufactured to strict guidelines and is packed and stored correctly to ensure its quality is maintained. . .

 


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