Fonterra model not best for milk or meat

June 8, 2015

Does Fonterra need to change?

Waikato University’s Professor of Agribusines Jacqueline Rowarth told Nine to Noon Fonterra was trying to do everything – supplying as well as branding and marketing – and there should be a major rethink of the structure.

“It’s too difficult to be milk supply, processing, branding and then the marketing of the brands at once, as well as expanding overseas.”

Past president of Federated Farmers’ Southland Russell MacPherson told the programme the business needed to be better run and simplified. . .

Fonterra is often cited as a good model by people wanting reform of the meat industry.

I don’t think it’s the best model for milk or meat. That the milk industry is following the meat model with more new processing companies being set up shows the single dominant company isn’t what all suppliers want.

There is competition for raw milk and the growth of new companies shows farmers want it.

Would there be so much criticism of Fonterra if the milk price was higher? Possibly but they wouldn’t be as strong.

Fonterra’s dividend was lower last year because the milk price was higher. The milk price is well down this year but losses on stock processed from last year’s high priced milk that was sold on this year’s market has eroded the dividend this season.

That is difficult to argue with that reasoning.

But the measure of a business is how it performs in tough times and it is fair to ask why Fonterra isn’t doing better.


Rural round-up

April 18, 2015

Criteria “too tough” on migrant workers – Federated Farmers – Tess McClure:

Farmers facing labour shortages say immigration criteria is “too tough” for migrant workers plugging the gap.

High numbers of farmers had approached Federated Farmers Southland with concerns about visas for their migrant worker employees, regional president Russell Macpherson said.

He said many workers were having trouble getting residency visas, despite calls from farmers to help keep their employees in-country.
 
“For some reason the people at immigration don’t think these jobs are important enough to grant them residency,” he said. “They’re doing work that New Zealanders clearly don’t want to do, so why are we making it so hard?”
 
While many migrant workers coming to New Zealand on work visas have high hopes of staying in the country and bringing their families over, less than a third are granted the chance of residency. . .

Shearing community mourns woolhandler:

The shearing community is mourning the loss of New Zealand woolhandling legend, Joanne Kumeroa, who has died after a three year battle with cancer.

The 45-year old had been living in Australia but returned home to Whanganui just before Christmas, and died yesterday.

Ms Kumeroa was regarded in shearing circles as a New Zealand icon, winning more World, Golden Shears and national wool-handling titles than any other competitor in her 24 year career.

Friends said she used her battle with cancer to raise women’s awareness of the disease. . .

Project to future-proof our biosecurity system:

Primary Industries Minister Nathan Guy has launched a new project which will further strengthen and future-proof New Zealand’s biosecurity system.

The project, Biosecurity 2025, will update and replace the founding document of New Zealand’s biosecurity system, the 2003 Biosecurity Strategy, with broad input from stakeholders, iwi and the New Zealand public.

“Government and industry have set a goal of doubling the value of our exports by 2025, and an effective biosecurity system is fundamental to achieving this,” says Mr Guy. . .

 

Peta’s mutilated lamb campaign sparks backlash (graphic content) – Rosanna Price:

The picture above has been captioned by PETA with: THIS is what most sheep used for wool look like after “shearing”.

But many people, including animal-activists and sheep shearers, disagree.

The image of an Australian musician holding the explicity graphic and mutilated body of a lamb was animal rights group PETA’s (People for the Ethical Treatment of Animals’) way of advertising their latest expose on sheep shearing. . .

Outstanding in her field:

Dairy Woman of the Year 2015 Katie Milne hopes to use her new profile for the wider good of New Zealand farming. 

Katie Milne hopes winning the Dairy Woman of the Year title will be a good platform to push messages about farming as “the rest of New Zealand do not understand us well”.

 “They need to understand us better so we can be allowed to grow our industry, and to do that New Zealand has got to back us,” Milne told Rural News. . .

Questions for Fonterra – Andrew Hoggard:

A lot of shareholders were disappointed with the interim results Fonterra announced last week.  Many feel they are not seeing a return on their investment.

I think we might be asking the wrong question.  It shouldn’t be about where’s the return on our investment, but rather where do we see the value of being part of a co-op.

At the moment the milk price we are paid is based on the Global Dairy Trade result.  It is averaged across the season – less manufacturing costs – in a very crude simplistic sense.  The reality is that all the other companies should be achieving this anyway with their products. . .

Field day for Waipā catchment:

An event organised by DairyNZ aims to advise famers and landowners on how best to manage their property in an environmentally sustainable way.

People in the Waipā River catchment are being encouraged attend the Kaniwhaniwha Stream field day, which will offer information on funding sources for environmental initiatives along with other resources.

Hosts Denis and Felicity Ahlers have worked with industry body DairyNZ to develop an environment-focused sustainable milk plan. They have also identified work that can qualify for council and Waikato River Authority funding. . .


Rural round-up

April 15, 2015

Don’t use high NZ dollar as excuse – MacPherson – Phil McCarthy:

Southland farmers need to look beyond the short-term constraints of a high New Zealand dollar and put pressure on meat and milk processors to perform better in the global market-place, Federated Farmers Southland president Russell MacPherson says.  

Yesterday the New Zealand dollar was sitting at about 99.4 cents against the Australian and 76 cents against the US Dollar. Along-side the high dollar, European dairy producers are on the verge of an end to quotas meaning they could ramp up milk production.

But MacPherson said that rather than seeing the developments as threats, farmers should recognise the other side of the coin with lower costs for farm inputs and less pressure on labour costs. . .

The hills are alight – Laird Harper:

A world first on east Taranaki’s unforgiving slopes has set the dog trial community alight.

Twenty-one huntaway dogs tackled the community stage of the Tarata Sheep Dog Trial under lights on Saturday.

Club president Bryan Hocken said the innovative approach proved pivotal to the trial’s success.

The large crowd and competitors were “fizzing” and “buzzing” all night and interest from outside the region was growing.

“It was a perfect night, a perfect site, everything was magic,” he said. . .

Maternal longevity traits closer – Terry Brosnahan:

A longevity breeding value for sheep will be released later this year.

Beef + Lamb New Zealand Genetics senior geneticist Mark Young said Sheep Improvement (SIL), B+LNZ Genetics and ram breeders recently reviewed the first version of a longevity breeding value for sheep.

Young said SIL would introduce it by the end of June this year. He was responding to an article in the March, 2015 issue of Country-Wide regarding compelling arguments for genetic selection to increase longevity of ewes and beef cows. 

Maternal longevity is a key trait missing from selection indices that characterise profit for a ewe flock or a beef cow herd. . .

New pieces to the puzzle – Ginny Dodunski:

The impacts of ewe body condition, variations in pasture components and the effects of salt topdressing on bearings have produced some surprise results.

The Beef + Lamb New Zealand farmer-initiated technology transfer (FITT) programme-funded trial investigated bearings on a large South Island sheep and beef property.

Lochiel Station, bordered by the Waiau River in north Canterbury, runs 42,000 stock units and has a history of high ewe losses from bearings.

“We have worked hard on improving our feed management and ewe body condition, plus have stabilised what was genetically a very variable flock,” station manager Kim Robinson said. . .

Diversity of opinion welcomed at Federated Farmers – Chris Lewis:

A few weeks ago I went through a bit of a learning curve about how to inadvertently make headlines. 

I’d thrown out a few thoughts at a Federated Farmers’ executive meeting on where our industry might be heading.  Those musings of mine morphed into front page news and down in Wellington what was claimed to be fixed Federated Farmers policy in parliamentary question time.

But I shouldn’t be too thin skinned about this.  Most of Waikato Federated Farmers’ meetings are fully open to whoever might want to turn up and we have always had a diversity of opinion expressed.

Our organisation has flourished the most when members have shown passion for a topic and offered to roll up their sleeves and offer their services to help on an issue.

This is how we initially attract most out our elected people to our organisation. . .

Lighting the way to dairy savings – Matthew Cawood:

ENERGY is a a major cost for dairy farmers, and one that keeps inexorably rising – which is why Dairy Australia has launched an initiative to identify energy waste in dairies.

The organisation secured $1 million in funding from the federal government to deliver the ‘Smarter energy use on Australian dairy farms’ project, which aims to improve energy efficiency on dairies.

Many of the potential energy leakages on farms, and the options for resolving them, are written up in a Dairy Australia booklet, Saving energy on dairy farms.  . .

 


Rural round-up

May 15, 2014

NZ renews efforts to restore beef, farm commodity volumes in Indonesia with WTO complaint – Jonathan Underhill:

(BusinessDesk) – New Zealand has made its second complaint in as many years to the World Trade Organisation about import restrictions and red tape in Indonesia that led to an 80 percent slump in exports of beef and horticultural products.

New Zealand and the US originally teamed up to initiate legal proceedings against Indonesia via the WTO in August last year. That complaint didn’t proceed beyond the consultation stage because Indonesia subsequently changed some of its measures, which under WTO rules meant a new application had to be made.

In the new complaint, lodged on May 8, New Zealand and the US cite Indonesia’s “unjustified and trade-restrictive” licensing requirements on imports, “unreasonable and discriminatory” pre-shipment rules and insufficient published details of how the restrictions work. . .

New rules ‘threat to young farmers‘ – Neil Ratley:

The new dairy farm plan change could force families who have farmed sheep and beef for generations off their land, a Southland Federated Farmers boss says.

Plan Change 13, which came into force in March, requires all new dairy farms to obtain resource consent from Environment Southland before becoming operational.

Since being introduced, more farmers than previously had applied to convert their farms to dairy and none had been turned down, Environment Southland says.

Despite this, Federated Farmers Southland president Russell MacPherson again voiced his concerns about Plan Change 13 at the organisation’s annual general meeting last week.

He said it would be harder for family farms to stay in the family under Plan Change 13. . .

$15,000 fine for quad bike breach:

A Marlborough farmer has been fined $15,000 for carrying a child on a work quad bike in what is believed to be the first prosecution of its kind.

Herd manager Rangi Holmes was on Wednesday sentenced at the Nelson District Court on two charges under the Health and Safety in Employment Act, which prohibits the carrying of passengers on quad bikes used for work, and requires quad bike riders to wear helmets.

WorkSafe New Zealand inspectors said they saw Holmes riding a quad bike in the Rai Valley carrying his two-year-old child in front of him on the bike at least five times during a 20-month period from February 2012. Neither was wearing a helmet. . .

How should dairy farmers react to sensitive issues? – Pasture to Profit:

 The public all have strong opinions about on-farm issues of Animal Welfare, Water Quality and TB. Individual Dairy farmers and Rural Professionals need to take a Public Relations leadership position.

Social Media provide powerful tools to take a lead position. We need to make the running and not be forced to play catch-up on sensitive social issues. Defending the indefensible is not very smart. How should farmers respond to Ugly public stories in the media?

I don’t think angry rejection is the right response to these stories in the press. Letters of denial usually imply a cover up. Best to agree with the outrage, then state very firmly that these incidents are totally unacceptable. We must engage with those who are upset and seek a joint understanding and find community agreed solutions.  . .

Food and Beverage reports released:

Three Food and Beverage reports were released on 8 May and showcase the key factors driving New Zealand’s food exporting success: high-quality ingredients, disease-free status, comprehensive network of free trade agreements, world-leading business environment, and strong food science capability.

The 2014 edition of the Investors’ Guide to the New Zealand Food and Beverage Industry shows that New Zealand’s food and beverage industry is well positioned for substantial growth, with exports on track to double in value in the next 15 years to US$40 billion.

The Food and Beverage Overview Report complements the Investors Guide with profiles of the top 50 food and beverage companies operating in New Zealand. Collectively these generate revenues of $42 billion. . . .

The Red Meat Profit Partnership gets down to business:

The Red Meat Profit Partnership (RMPP) has reached its first milestone of being fully established as a limited partnership and has appointed a board of directors.

The RMPP is a red meat sector and government collaboration designed to boost sheep and beef farmer productivity and profitability. It draws together nine industry partners who are co-funding the programme along with the Ministry for Primary Industries through its Primary Growth Partnership (PGP). They include Alliance Group, ANZCO Foods, ANZ, Beef + Lamb New Zealand (representing sheep and beef farmers), Blue Sky Meats, Greenlea Premier Meats, Progressive Meats, Rabobank and Silver Fern Farms. . .

New way to cut out timber fumigation:

New techniques spearheaded by the Ministry for Primary Industries have led to some timber exports heading to Australia without first having to be fumigated with the ozone-depleting gas methyl bromide.

Australia wants to keep the burnt pine longhorn beetle that’s found in New Zealand, out of its country and until recently all sawn timber had to be fumigated during the summer flight season of the beetle.

Ministry director of plants, food and environment Peter Thomson says a successful trial has shown the Australians that other methods can be applied to keep the beetle out.

“With this alternative, timber exporters or wood product exporters are able to keep their product in a secure area that will exclude those beetles.

“And as long as they process their product and pack it into containers in a way that excludes the beetle from being able to get in there during the process then they’re free to ship under this new system,” said Mr Thomson. . .


Rural round-up

April 11, 2014

Farmers back irrigation feasibility study:

A planned large-scale irrigation scheme in South Canterbury has got enough farmer backing for it to carry out an in depth feasibility study.

The Hunter Downs Irrigation Scheme, which could irrigate up to 40,000 hectares of land from Waitaki to just south of Timaru, also has significant financial backing from the Government.

Hunter Downs Irrigation chairman Andrew Fraser says they’ve been going through a capital raising process over the last several weeks – and have managed to get over the threshold of 20,000 hectares of farmer uptake.

“This funding will enable us to do a feasibility study and so that will tell us whether the scheme is economically and technically viable so we hope to have that result back out to the shareholders and farmers by the end of the year.”

Mr Fraser says the capital raising period has been extended as the scheme gauges corporate interest and speaks to more farmers in the area. . .

Winners committed to pushing farming change – Gerald Piddock:

Mike and Sharon Barton’s innovative approach to farming in an environmentally sensitive area has earned them the supreme title in the 2014 Waikato Farm Environment Awards.

The Western Taupo beef farmers were presented with the award as well as category awards for soil management and innovation at a ceremony near Karapiro last night.

The Barton’s farm at Glen Emmreth Farm near Tihoi. They purchased the 142ha property in 2004 at a time when strict environmental legislation to protect the health of the lake was looming.

They faced this challenge head-on, determined to make their farm as environmentally sustainable as possible. . .

Farmers warned to tidy up act:

Federated Farmers is warning farmers not to risk making the dairy industry a scapegoat at this year’s general election through poor farm practices.

In a message to farmers, dairy chairman Willy Leferink said he was worried they could be negatively portrayed during the election campaign and they needed to do the basics properly to avoid bad publicity.

Visual aspects of the industry needing to be tidied up, and that could help create a better public image, Mr Leferink said. . .

Call for better health and safety on farms after death –  Collette Devlin:

Farming is a hazardous occupation and the number of injuries and deaths on Southland farms must come down, industry insiders say.

They are calling for better health and safety awareness on farms.

The issue has been put in the spotlight by the tragic death of fertiliser truck driver Les Cain, killed when the truck he was driving overturned on a northern Southland farm on Tuesday.

Southland Federated Farmers president Russell MacPherson said one farm death was one too many.

The old attitude of ‘she’ll be right’ needed to disappear from the industry. . .

Hawke’s Bay Farmers of the Year – Hugh and Sharon Ritchie – RivettingKateTaylor:

Well done to Hugh and Sharon Ritchie – Hawke’s Bay Farmers of the Year.

I’ve just been writing about Hugh lately as I am doing the Nuffield NZ newsletter and he has just retired after 12 years as a trustee (we also went through Young Farmers together, although I hasten to add he is older than me!!!  Hugh, Shane Tilson and I won a national debating final in 1995!)

So last night (back to the important news) they were awarded the prestigious Silver Fern Farms Hawke’s Bay Farmer of the Year title in front of 350 people at a dinner at Showgrounds Hawke’s Bay (well done on great night Hillary). . .

D2S ‘growing at a rate of knots’:

Wool growers have rallied behind Wools of New Zealand’s Direct-to-Scour (D2S) spot market sales option.

Launched in October last year, volumes under D2S are doubling month on month and have now reached around 350,000 kgs, with annualised volumes expected to reach between 3.5m – 4m kilograms within its first year, about 8% of the market.

Ross Townshend, Chief Executive of Wools of New Zealand told shareholder growers and supporters during the company’s roadshow series of 12 national meetings this week that the system was “simpler and put more money into the pockets of growers than the conventional model. It makes logical sense for growers’ wool to go to the first point of processing which is the scour where it can be core-sampled, independently tested, objectively assessed and fairly priced. . . .

Wool Market Defies Dollar:

New Zealand Wool Services International Limited’s General Manager, Mr John Dawson reports that despite a resurgent New Zealand dollar the South Island offering of 11,500 bales saw most types range from firm to 3 percent dearer. Even with the strength of the sale and an 86 percent clearance, some growers were still unprepared to accept current market levels with 13 percent of the offering being passed in.

The weighted indicator for the main trading currencies was 1.36 percent up on the last sale on 3rd April.

Mr Dawson advises that Fine Crossbred Fleece and Shears were between 1 and 3 percent firmer. . .


Doing better environmentally and economically

January 22, 2014

The old adage that if you give a dog a bad name it will stick is unfortunately true.

Farming, and dairying in particular, has got a bad name for poor environmental performance even though most are doing all that’s required of them, or more.

Despite 5.7 dairy cattle for every man, woman and child in Southland, the region now boasts some of most environmentally compliant farmers in New Zealand. 

“The compliance monitoring results from Environment Southland, which came out before Christmas, was a real boost for our guys,” says Russell MacPherson, Federated Farmers Southland provincial president.

“It is not just us in the far south but this is a trend throughout New Zealand.  After catching talkback radio recently, the shame is that some people have been suckered in by a clever but increasingly redundant slogan. 

“I mean the Ministry for the Environment’s “River condition indicator Summary and key findings” must be the most non-reported study of 2013.  A 10-year review of water quality found, “of the parameters we [the MfE] monitor, all are either stable or improving at most monitored sites. Four of our parameters show stable or improving trends in 90% of sites”.

“Take the Mataura River, which received the regional award for the most improved river at the first New Zealand River Awards.  There are physical results proving that it is working and it goes to show how Southland’s farmers are hitting their straps environmentally.

“The majority of Southland’s 887 farming effluent discharge consent holders inspected by Environment Southland were fully compliant with their consent conditions.

“While we farm in what seemingly feels like a glass house, the fact is we are doing better each year environmentally and economically.

“In terms of ground and surface water, the vast majority of our farms are doing pretty well here as well. 

“Federated Farmers believes a new attitude shown by Environment Southland, to actively work alongside farmers like in Taranaki, is starting to pay off.  Farmers previously felt like they’d be belted for anything but we’re now seeing partnership and greater understanding.

Councils and farmers working together will achieve better results than if there’s an antagonistic attitude between them.

“The way town and country are coming together is also evidenced by the way the New River Estuary has galvanised Invercargill residents around storm and wastewater. 

“It will upset those who have made a career out of grievance but truth eventually cuts through spin.

“Perhaps that’s the nub of the issue we face as it’s all about perception, much like that Lincoln University survey from last year.  There’s what some people think we do and what we actually do.  Trying to connect the two is going to take time.

“That could start by having the same scrutiny our farms are put under extended to our local councils. 

“. . . there’s been three human sewerage spills within a month into Lake Wakatipu and the latest one closed a 200 metre stretch of beach right where our family, like many, swim and boat when on holiday.

“If town and country had the same level of scrutiny then the national conversation, I feel, would be much better,” Mr MacPherson concluded.

Poor environmental practices in one area doesn’t excuse it anywhere else and there’s no room for complacency about water quality in urban or rural areas.

Some farmers have been far too slow to get the message about their responsibility for water quality and act on it. But the majority are compliant and are working hard to ensure they stay that way.


Farm tools not toys

January 9, 2014

The death of another child who was riding a quad bike is another tragedy.

Police are investigating and there will be an inquest.

Both are certain to reinforce what Southland Federated Farmers chair Russell MacPherson says – quads are farm tools not toys.

. . . Quad bikes looked like fun and could be fun but were terribly dangerous machines, especially in the hands of young people, Mr MacPherson said.

“This is a reminder to parents and grandparents, our children and grandchildren should not be on adult quad bikes, it’s that simple.”

Full-sized four-wheelers carried labels from the manufacturer specifying no-one under 16 should ride one.

The adult-size four-wheelers were heavy, powerful machines and needed an adult to control them, Mr MacPherson said.

“You need weight to manoeuvre and control an adult four-wheeler and kids don’t have that.”

No passengers should be carried on a four-wheeler either, unless designed to do so: passengers restrict the rider’s mobility and add weight, making it harder to control and more prone to tipping over.

“This is a terrible tragedy for the family involved, for Southland and farming communities and if anything can come out of it, it will be a reminder that four-wheelers are dangerous and potentially can kill,” Mr MacPherson said. . .

Few if any people would consider letting young children ride an adult 2-wheel motor bike; drive a tractor, truck or digger or use a chain saw.

The same cautious approach should apply to quads.

They are deceptively easy to ride in perfect conditions but they are large, heavy and unstable machines which can be very difficult for experienced adult riders to handle when even something minor goes wrong.


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