Rural round-up

August 26, 2019

Time to stop shaming farmers – Rowena Duncan:

The recent Will to Live Tour gets The Country Early Edition host Rowena Duncum thinking about rural mental health.

Just last month I had a bad day. We all get them. I felt like there’s so much negativity out there aimed at farmers.

A few hours later though, I got a swift reality check in the form of a passionate and switched-on 21-year-old imploring more than 200 people in Balclutha to remember “how good we are at what we do” and to “be bloody proud to be a farmer”.

By the time you read this, the Will to Live charity’s ‘Speak Up Tour’ will have just completed its 13th event, with four still to come later this month. . .

Restored wetland in the Waikato shows how farmers can hugely improve water quality.:

Gray Baldwin has spent five years undoing work his grandfather did on the family’s South Waikato farm – and he’s thrilled with the result.

He and wife Marilyn own 713ha south of Lichfield, near Putaruru. They have a 200ha dairy farm running 900 cows and 160ha planted in maize. The rest of the property is in forestry or retired land.

“We’ve been there since 1955,” Gray says. “I’m the third generation, my son runs the farm and we’ve got three grandsons running around the place now.” . . 

The rest of the story about animal agriculture and climate:

Frank Mitloehner is on a mission.

In the wake of a United Nations report pinning much of human-caused global warming on animal agriculture and promoting veganism as the logical alternative, Mitloehner, a professor of animal science and air quality specialist at the University of California-Davis, wants to set the record straight.

In doing that, he is encouraging farmers and ranchers to tell the public, as radioman Paul Harvey used to say, “the rest of the story.”

While the U.N. report pointed out that cattle and other animals do indeed produce the greenhouse gas methane — no secret there — he says the U.N. and “special friends” such as anti-animal agriculture activists and vegan promoters leave out important facts. . .

Estuary ‘riddled’ with whitebait:

Key to improving water quality is increasing NZ’s wetlands – after 90 per cent were drained.

It’s not everyone who can relax after a hard day’s work, throw out a line and hook a snapper for dinner from their own backyard.

Tapora dairy farmer Earle Wright can. Yet his good fortune is not due to luck or some inside knowledge about a secret fishing spot.

Rather it is a payback for years of effective environmental stewardship of his 120ha farm, a property backing on to an estuary in the Kaipara Harbour north of Auckland. . .

Cost should not shut borrower out of mediation sharemilkers say:

The Sharemilkers Section of Federated Farmers strongly supports the Farm Debt Mediation Bill (No 2) but would like to see changes to ensure a borrower isn’t shut out of the process because they can’t afford it.

The legislation could make it compulsory for lenders to make funds available to farmers to fund their share of mediation costs, Sharemilkers Chairperson Richard McIntyre told the Primary Production Select Committee this morning.

Alternatively, it could require the lender to fund the mediation, “which we as a sector would no doubt fund indirectly through increased fees”. . . 

Zanda McDonald Award winners have bright futures – Jessica Johnston:

TWO young guns are making great strides in the northern beef industry, proving the future of agriculture is in safe hands.

The passion and commitment to their chosen careers has seen Queenslander Shannon Landmark and the NT’s Luke Evans offered a unique mentoring opportunity under the Zanda McDonald Award, which recognises outstanding young professionals in the ag sector.

Ms Landmark, 28, was born in Mount Isa to a mining family, and garnered an interest in agriculture throughout her time in regional Queensland. . . 

 


More milk from fewer cows

November 29, 2017

New Zealand milk production is up while cow numbers are down:

Daisy and her paddock mates are record-breakers, reveal the latest national dairy statistics released today by DairyNZ and LIC.

Over the 12 months to June 2017, the average dairy cow produced more litres of milk containing more kilograms of milksolids than ever before.

The average dairy cow produced 4,259 litres of milk in the 2016-17 season, containing a total of 381kg of milksolids (kg MS), compared to 4,185 litres and 372kg MS in 2015-16.

The latest New Zealand Dairy Statistics 2016-17 also reveal milking cow and herd numbers have decreased for the second consecutive year. The latest count is 4.86 million cows nationally – down from 4.99 million in 2015-16 – while herd numbers have dropped to 11,748 from 11,918 (-170 herds).

But despite the decline in cow numbers, dairy companies processed very similar milk quantities – 20.7 billion litres of milk containing 1.85 billion kg MS in 2016-17. The previous season was 20.9 billion litres of milk (1.86 billion kg MS).

The results are positive for New Zealand and its farmers, says DairyNZ and LIC.

DairyNZ senior economist Matthew Newman says the trend for increasing per cow milk production shows farmers are opting for animals that are year-on-year more efficient at converting grass into milk – the industry’s national breeding objective.

“We are producing similar milk quantities from fewer cows, partly because we are breeding better animals and feeding them well,” says Matthew.

Since the 1980s ag-sag sheep numbers have dropped but meat production hasn’t.

Cow numbers have increased in recent years as more farms converted to dairying but now dairying is following sheep with more production from fewer animals.

“The average herd is now 414 cows, down from 419 in 2015-16. Currently we are at the lowest level of cows milked since 2012 – with North Island cow numbers declining 90,000 to 2.89 million, while South Island numbers decreased 46,000 to 1.97 million.”

LIC general manager NZ Markets, Malcolm Ellis, says the stats reflect a shift in the industry.

“Farmers are acknowledging that, as an industry, if they are not going to be milking more cows then they need to be milking better ones,” says Malcolm.

“The lower payout in previous seasons certainly forced some farmers to reconsider their cow numbers as part of a wider farm system review, but these stats prove it can really payoff for a farming business.

“It boils down to the fundamentals of herd improvement – creating high quality herd replacements that will out-perform their mothers in productivity, longevity and fertility.” . . 

It’s a matter of improving production rather than increasing cow numbers.

Doing more with less is better for staff, the environment and income.

Sharemilking structure

Farm ownership structures have also changed over the last couple of seasons, with 27.3 percent of New Zealand dairy herds operating under a sharemilking agreement in 2016-17, compared with 32.4 percent in 2014-15.

Within the sharemilker herds, variable order sharemilking (VOSM) herd numbers declined in 2016-17. In particular, 20-29 percent sharemilkers decreased by 235 herds (-29 percent) to 586. In 2013-14, there were twice as many VOSM herds compared to today (1,357).

Herd-owning sharemilkers (50:50 sharemilkers) declined (-91 herds) for the fourth consecutive season and now account for 19.8 percent of all herds.

Owner-operator herds increased 188 to 8,503 herds in 2016-17, reflecting VOSMs moving to contract milking after financial challenges with low milk prices. . .

Sharemilking started in New Zealand, where it’s governed by an act of parliament, and is rarely used elsewhere.

A reduction in numbers of sharemilkers isn’t good for the medium to longer-term health of the dairy industry.

It has always been a way for dairy workers to get on and up the ladder to farm ownership.

We used to have managers but changed to lower order sharemilkers several years ago.

The change has been better for animal health, staff and production.

Sharemilkers have skin in the game. The better they do, the more they make and that incentive works to get the farms working better.

For the sake of the industry I hope that the reduction in the number of sharemilkers is temporary.

 


Keep calm and dairy on

August 7, 2015

Fonterra will announce a drop in its forecast payout today.

Whatever it is,  it will be below break-even for all but the very leanest of operations.

However, it is important to keep it in perspective. Most farmers will be facing a cash flow problem not an equity one.

There have been eight big drops in payouts in the last 40 years and only three of them have led to significant falls in land values. Those were during the ag-sag of the 80s, the Asian crisis in the late 90s and the GFC when the rest of the country and most of the world were in trouble too.

Providing farmers keep talking to and working with their bankers they will be willing to help them through the next season or two until the milk price improves.

Only then will they will focus on any structural problems because in spite of the rhetoric from the Chicken-Littles, banks aren’t going to be forcing people off their farms if there are alternatives. That would not only be bad for the banks and the troubled clients it would have a depressing affect on land values which would then start biting the equity in other farms.

There’s no doubt this season will be a test of farmer resilience:

The possible milk payout forecast by DairyNZ CEO Tim Mackle, based on Open Country, of $4 per kilogram of milk solids has the potential to hit the average dairy farm by $250K according to KPMG analysis. . .

This projected price level will sorely test farm system resilience and confidence according to KPMG Farm Enterprise specialist Roger Wilson.
“The Individual impacts will vary depending on farm system and debt.” says Wilson, “The outlook is tough but this is the time to apply some science and really examine the options.”

A lot of farms are actually adaptable and resilient and the smart farmers can be very responsive even in the short term. With stronger beef prices farmers may look at incorporating an element of dry stock farming, particularly if dairy herd sizes are reduced.

Where there’s crisis there’s also opportunity.

The KPMG Farm Enterprise team are already seeing proactive farmers using a combination of reducing the use of supplements and fertiliser, and lowering stock numbers and the reliance on off-farm grazing.

The big call is stock numbers where a one off cull of 10-20% of cows post calving might be a good option. Critically this has a one off cash flow benefit, and tightens the operating budget without impacting capacity in 24 months.

Roger Wilson says, “Expect this to contribute to a reduction in milk supply for 2015/16 which is forecast to provide Fonterra with a bit more flexibility at its end.”

The reduction in supply should contribute to improved operating performance for dairy companies in 2014/15. Fonterra is already running at full capacity which limits its product optimisation options. With increased capacity and reduced supply Fonterra will have the flexibility to move a much higher proportion of product into high value streams and drive a much better EBIT number.

It shouldn’t be forgotten that returns across the balance of the industry are still in a good place, 60% plus of the primary sector is booming, this shouldn’t be overlooked.

Red meat, pipfruit, kiwifruit and wine are all selling well and in spite of the hit the economy will take from the dairying downturn, it is still growing.

That said, this season will be difficult.

Sharemilkers are at risk if they have a lot of debt. Farmers who want to retain good people in the industry need to work with their sharemilkers and the banks to help them through the downturn.

The low payout will hurt people who service and supply dairy farms, including other farmers who provide supplementary feed or grazing. Some of these will be able to make the most of good beef prices.

The wider economy will also feel the pinch as farmers reduce their costs and cut back on expenditure where they can.

A banker told me one of his dairy clients regularly uses 80 other businesses, most of them smaller ones, and all of those will be hit as their bigger customers stop spending.

Dairying accounts for a bit more than 20% of our exports and around 5% of the economy.

The downturn has already spread off-farm but unlike the downturns in the 80s, 90s and noughties, the root of this one is one is largely confined to dairying.

Dairy farmers, sharemilkers and those who get most of their income from them will have a lean season.

But the sky isn’t falling and what goes down will go up again, sooner or later.

 

 


Rural round-up

April 3, 2015

New Zealand Greenshell mussel breeding begins at brand new hatchery in Nelson

New Zealand aquaculture will be getting stronger mussels, thanks to some heavyweight Kiwi science underway in Nelson.

A new hatchery and lab facility is opening today (02/04) just north of the city at the Cawthron Aquaculture Park where Greenshell™ Mussels can be selectively bred like sheep or cattle to give our mussel farmers the very best that nature has to offer on their mussel farms.

The project leaders say it takes the element of chance out of mussel farming. . .

 

New hatchery to boost mussel industry:

Primary Industries Minister Nathan Guy has welcomed a major milestone for the aquaculture industry today with the opening of the country’s first ever hatchery specially designed for mussels.

The mussel hatchery and nursery facility in Nelson is part of the SPATnz Primary Growth Partnership (PGP) programme, which was established to develop selectively bred, high-value Greenshell™ mussels.

“This hatchery is the culmination of years of research and development by a team of scientists from Shellfish Production and Technology New Zealand Ltd (SPATnz) and the Cawthron Institute,” says Mr Guy.  . .

“It has the potential to generate nearly 200 million dollars per year to New Zealand’s economy. . .

Wasps sting NZ economy:

Two species of introduced wasps are costing New Zealand’s economy more than $130 million a year.

A study by the Department of Conservation and the Ministry for Primary Industries showed German and common wasps, which belong to the genus Vespula, have had huge economic impacts on farming, beekeeping, horticulture and forestry.

Department of Conservation scientist Eric Edwards said the loss of honey production was one of the major costs. . .

NZ’s “basketcase” bee industry seeks levies, national body – Suze Metherell:

(BusinessDesk) – Representatives of New Zealand’s fragmented bee industry have called on government support to reintroduce commodity levies for honey and the creation of a single national body by April next year.

Appearing before the primary production select committee, John Hartnell, chair of the Federated Farmers Bee Industry Group, Ricki Leahy, president of the National Beekeepers Association and its chief executive Daniel Paul, said government support is needed to reimpose commodity levies to help fund a single, comprehensive national association to represent the industry worth an estimated $5.1 billion annually. . .

New beagle pups join biosecurity team:

Two wriggly beagle puppies will spend their first Easter as trainee biosecurity detector dogs.

Ten-week-old Charleston and Roxy (brother and sister) joined the Ministry for Primary Industries’ detector dog programme two week ago.

If all goes well, they will start sniffing out food and plant materials at New Zealand’s airports and ports after 12-14 months of training. . .

Low dairy prices may have silver lining:

While all dairy farmers will be feeling the financial crunch this year, some are still looking for a silver lining.

Federated Farmers’ sharemilking chair Neil Filer said it could provide an opening for young sharemilkers to get their foot in the door.

Prices fell by 10.8 percent in last night’s GlobalDairyTrade auction, with an average price of $US2746 a tonne. Whole milk powder fell 13.3 percent to $US2538.

Mr Filer said sharemilking was still seen as an attractive and viable industry and at times like this, there could be a positive side. . .

 

Infant formula marketing decision welcomed:

The Infant Nutrition Council (INC) welcomes the Commerce Commission confirmation of the authorisation of the INC’s Code of Practice for marketing infant formula.

The Code of Practice restricts the advertising and marketing of infant formula by members.

It has been in place since 2012 and is consistent with New Zealand’s commitment to the World Health Organisation’s International Code of Marketing of Breast Milk Substitutes (WHO Code). . .

 

Fonterra Notifies Affirmation of Credit Rating:

Fonterra Co-operative Group Ltd is pleased to advise that it has been notified by Standard & Poor’s Ratings Services that they have affirmed Fonterra’s credit rating. This affirmation follows the release of Standard & Poor’s rating criteria for agricultural co-operatives which applies to Fonterra. . .


Rural round-up

July 21, 2014

A balanced lifestyle – Sally Rae:

Entering the Ballance Farm Environment Awards reinforced to South Otago couple Brendon and Suzie Bearman they were ”heading in the right direction”.

The couple, who farm a 245ha property south of Milton, received the Otago Regional Council water quality award, LIC dairy farm award and PGG Wrightson land and life award in this year’s Otago BFEA awards.

The opening date for entries in the 2015 competition is August 1 and Mrs Bearman encouraged people to enter. It was a good forum to promote farming in a positive light and the ”good things” people were doing on farms needed to be highlighted, she said. . .

Caution urged on intensification – Andrea Fox:

Not long ago Irish dairy leaders were saying New Zealand dairy farmers had lost the plot on cost competitiveness.

DairyNZ chief executive Tim Mackle recalled they gave him stick about the Kiwi move to higher inputs and this country’s flirtation with cow housing. 

Now the Irish are fearful they will go down the same road, with European milk production quota limits coming off next year. . .

Skills key to future success – Andrea Fox:

Sharemilkers will always be among us but the future pathway to farm ownership will be through the classroom, sector veterans say.

With the number of herd owners from the traditional nursery, 50:50 sharemilkers, shrinking in the past decade, from more than 3000 to 2229 last year, there is a question mark over who will be the dairy farm owners of the future as land prices, which spawned sharemilking, continue to rise.  

Sharemilker, farm-owner and DairyNZ director Ben Allomes said as the dairy industry grew in size and maturity, it would not be so much the sharemilking system that would be the ladder to farm ownership but an ability to work whatever system there was to get traction. . . .

Molesworth Station: From ruin to redemption :

The story of Molesworth is one of ruin to redemption, says the author of a book on the iconic high country station.

”It’s sort of a heroic theme really and a lesson in fantastic land management,” says Harry Broad, the journalist and conservationist behind Molesworth: Stories from New Zealand’s largest high-country station.

Harry is one of the authors at next weekend’s Marlborough Book Festival, where he’ll share stories of the incredible history, landscape and people of Molesworth.

The 180,000-hectare Marlborough station was ”close to ruin” by 1937, due to poor management, aggravated by low wool prices, a plague of rabbits and winters that could kill a third of its sheep. . .

Beef, lamb exports near peak – Gerard Hutching:

New Zealand beef and lamb exports are at almost record levels for the first nine months of trade this season.

Beef + Lamb New Zealand figures show lamb exports reached $2.06 billion for the nine months to June, despite volume dropping by 3.6 per cent and the disadvantage of a strong dollar.

The buoyant meat export figures are in contrast to recent slumps in dairy prices. In a shock fall, dairy prices dropped 8.9 per cent at the latest Global Dairy Trade auction earlier this week and are down about 35 per cent from recent peaks. . .

 

Single farmers looking for love – Kelly Dennett:

A new Facebook page that helps farmers find love has created a stir in the provinces.

NZF Singles invites country folk seeking companionship to post their photo and information for others to peruse.

The applicants could see who liked or commented on their photo and add them online accordingly.

For those seeking something a little more casual, a Russian roulette style system called Second Chance Sunday invited people to post their Snap Chat names or phone numbers on the wall for others to get in touch.    . . .


Rural round-up

July 30, 2013

HNZ praises biosecurity improvements – Dan Satherley:

More than 400 fruit and vegetable growers will meet in Wellington today at the annual Horticulture New Zealand conference.

Government industry agreements, biosecurity and food safety in the industry will all be discussed over the next two days, and industry newcomers will battle it out for the title of Young Grower of the Year.

The industry is worth $5 billion to the economy and employs more than 150,000 people, so Horticulture New Zealand president Andrew Fenton says it’s essential that recent improvements to biosecurity are maintained.

“We have a lot more activity with more frontline border security people; we have a lot more focus on electronic and technical surveillance; we have a lot more focus on the dog patrols, which we in fact will be having at the conference today to show growers what is being done,” he says.

“I have to commend MPI for their commitment to increase biosecurity, but we never, never need to relax on it.” . . .

Attitude is everything in sharemilking – Richard Jones:

It has never been easy to achieve farm ownership.

The sharemilking system was established to enable young Kiwis to build up equity to progress through to farm ownership. Sharemilkers gradually build cow numbers, either by raising calves or buying cows, becoming what is known as a herd-owning sharemilker (HOSM). They would then sell some for the deposit on a farm and stock it with the remaining cows.

However, with the rapid increase in farm sizes and the price of land escalating, taking the leap up the progression ladder from contract milker and variable order sharemilker to a HOSM is becoming increasingly difficult.

As a result, sharemilkers need to stay sharemilking longer to build equity, slowing their progression to farm ownership. This holdup also affects farm owners wanting to exit the industry, as fewer sharemilkers have enough equity to pay a decent price for a farm. The only option available for these farm owners may be the faceless multi-national corporate, not the experienced, hands-on sharemilker. . .

Exports grow better when working as a pair

Newly formed avocado exporter Avoco has raised its forecast for this season’s earnings in Australia. It now expects to hit the $50 million mark by the end of the harvest, which starts late next month.

Avoco director Alistair Young says the latest analysis of the potential harvest suggests an above-average yield.

Formed last month by New Zealand’s two largest avocado exporters, Avoco represents about 75 per cent of New Zealand growers and holds a similar-sized chunk of sales in the Australian market.

“We were forecasting retail and wholesale sales in Australia of about $40 million when we launched Avoco. . .

What is the Meat Industry Excellence Group? – David Burt:

The Federation is keenly aware that if structural change, of whatever form, is to be successful, behavioural issues must also be resolved.

The Meat Industry Excellence (MIE) group was set up to address farmers’ frustration about the parlous state of the red meat sector, particularly the sheep industry.

Established in March, MIE has held a number of meetings seeking a mandate from farmers to work with the meat companies to develop an industry consolidation plan. The group’s executive is chaired by Richard Young.

The group is currently working towards areas such as developing potential new industry models, which would then be considered by stakeholders for possible adoption. . .

Agri-buisness network aims to help economy:

An East Coast farmer says the Gisborne economy is likely to profit from the establishment of a new local Maori agribusiness network.

Te Tairawhiti Maori Agribusiness group was set up recently as a result of a hui for Maori farmers from the East Cape to northern Hawke’s Bay.

The hui discussed the idea of working together and developing and branding products for several niche market opportunities.

Rongowhakaata farmer Stan Pardoe says the network will bring in more profit for the Gisborne region and help to market the area internationally. . .


Who owes how much to whom?

May 21, 2012

Dairy NZ suppliers were told on Friday that they’d have to wait about a month for the $30 million they’re owed.

That is a lot of money for the company that is in receivership and it won’t be all that they owe.

It’s also a lot of money for suppliers who will have bills to pay.

Synlait is showing some interest in the dairy factory but any new owner would be loath to take on the liability for unsecured creditors, among whom are the suppliers.

There is understandable concern about how much of the money they’re owed the suppliers will get and it’s not just farm owners.

Share milkers are also owed money and there is uncertainty about whether that is the company’s responsibility or the farm owners’.

Ian Moore, a spokesman for the farmers who supply milk to NZ Dairies, admitted yesterday he was concerned about the immediate prospects. . .

. . . His main concern was for sharemilkers, who typically own only the cows and share in the milk cheque, who have no equity to fall back on.

Mr Moore has already been in contact with rural bankers from the area who he hoped would turn up to yesterday’s meeting and support the affected farmers, to prevent “anyone from going to the wall” if payments are delayed or do not come through.

Then there are the people who supply and service the dairy farms who will be owed money by the suppliers who are owed money by the company.

One attraction of companies like NZ Dairies is that suppliers don’t have to buy shares as they do with Fonterra. That is of most benefit to those with newer conversions who will be in a weaker position to withstand a delay or loss of payments.

Most if not all suppliers are from South Canterbury and North Otago where the receivership will have an impact on the districts’ economies.


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