Rural round-up

July 12, 2014

Trade deal with Japan could prove too costly:

Japan’s Prime Minister, Shinzo Abe, must have noticed a striking difference between New Zealand and Australia when he visited the countries on consecutive days this week. In New Zealand he found a firm commitment to a comprehensive trade agreement, the Trans Pacific Partnership. In Australia he was able to sign a soft bilateral “free trade” agreement, settling for much less on agriculture than other food producers hope to gain from the TPP. Australia is not a team player on trade – it is prepared to undermine collective efforts when offered a lesser but exclusive deal. Japan’s attitude is more important.

It is a country in economic and demographic decline but it is still one of the world’s largest economies, second only to the United States among the 12 nations negotiating the TPP. Its side-deal with Australia was disappointing, bearing out New Zealand’s expressed doubts that admitting Japan to the talks was a good idea. But elsewhere hopes persist that Mr Abe is serious when he uses the TPP as leverage for much needed and long overdue reforms of Japan’s economy. . .

Council not investing in water scheme:

Another potential investor has decided against putting money into Hawke’s Bay’s controversial Ruataniwha water storage scheme.

The Central Hawke’s Bay District Council says it believes the proposed $600 million scheme, which could irrigate about 25,000 hectares, could be a huge money- and job-spinner for the region.

But deputy mayor Ian Sharp said on Friday the council won’t be investing in it, now that residents have overwhelmingly opposed borrowing the $5 million needed to do so.

“I think it’s important we distinguish between support for the water scheme and borrowing money to invest in the water scheme,” he said.

“A number of the submitters who did not want us to borrow money to invest are 100 percent behind the scheme, they just felt it was fiscally irresponsible for the council to borrow money to invest in the scheme.” . . .

Reappointments to FSANZ board:

Minister for Food Safety Nikki Kaye today announced the reappointment of Andrew McKenzie and Neil Walker to the Food Standards Australia and New Zealand (FSANZ) Board.

Dr McKenzie has a background in veterinary public health, food safety, food regulation, international and financial management.  He has extensive knowledge of the New Zealand food regulation system having led the New Zealand Food Safety Authority from its inception in 2002 until 2010.

Mr Walker is a food scientist and has spent 35 years working in senior roles in New Zealand’s dairy industry.  He has strong governance experience and has been a chair, director, trustee and committee member of public councils and authorities.

The reappointments were proposed by New Zealand in a formal process that required acceptance by the Australia and New Zealand Ministerial Forum on Food Regulation. . .

Fonterra and Abbott to Form Strategic Alliance for Dairy Farming in China:

First Farm Expected to Produce Milk in First Half of 2017

Fonterra Co-operative Group Ltd and Abbott today announced the signing of an agreement to develop a proposed dairy farm hub in China. The strategic alliance, which is subject to Chinese regulatory approval, will leverage Fonterra’s expertise in dairy nutrition and farming in China and Abbott’s continued commitment to business development in China.

Dairy consumption in China has been rising steadily over the past 10 years. The continued development of safe, high-quality milk sources is essential to meeting this growing demand from Chinese consumers. Fonterra and Abbott are pleased to be able to work together and through this alliance to make a positive contribution to the growth and development of China’s dairy industry. . . .

Fonterra seeks Hokkaido farmers for dairy study:

Fonterra is seeking four Hokkaido dairy farms to take part in a study to increase the efficiency and profitability of grassland dairy farming in Japan.

The study, which begins in December this year, will involve the collection and monitoring of physical, production and economic performance data from four leading Hokkaido grassland dairy farms. The analysis will take place over one production season and include data collection over summer outside grazing periods and during indoor winter housing.   . .

Top food science award for Massey professor:

MASSEY UNIVERSITY Professor Richard Archer has been awarded the New Zealand Institute of Food Science and Technology’s most prestigious honour, the JC Andrews Award.

The annual award is in memory of Massey’s first Chancellor, Dr John Clark Andrews, who proposed that New Zealand’s first food technology degree be established in 1964. The award recognises institute members who have made a substantial contribution to science and technology and leadership in the food industry. . .

A brilliant new wound care products – Medihoney:

Now available at the SummerGlow Apiaries online store is the Comvita Medihoney range of products.

Medihoney combines leading wound care and therapeutic skincare products made with an exceptionally high quality medical grade Manuka Honey.

Comvita uses advanced scientific knowledge to maximise this honey’s potential in all of its therapeutic products.

Medihoney products challenge the reliance on synthetic medicines and treatments and provide a natural alternative for wound and skin care, suitable for use by the whole family. . .

It's Cow Appreciation Day! Let's pause for a little moment and think about all the  amazing cows in the world. It’s easy to forget how awesome these animals are and how integral to our daily life. #CowAppreciationDay


Rice market reforms big step towards free trade

January 14, 2014

Agriculture has been a large stumbling block in free trade deals with Japan but that is about to change:

NOT even the most ardent reformers around Shinzo Abe, Japan’s prime minister, believed that he would dare to scrap the policy, known as gentan, under which the government has paid farmers to reduce rice crops since 1971. But on November 26th the agriculture ministry said the system would be phased out by 2018. Rice growers, said Mr Abe, will be able to produce crops “based on their own management decisions”.

Allowing a free market for rice, the country’s sacred staple food, will not by itself transform Japan’s inefficient agricultural sector, which has declined precipitously in recent years. But it is an unavoidable and welcome first step. The gentan system was originally designed to shield the country’s cosseted farmers from short-term fluctuations in prices. By 2010 the policy kept roughly a third of Japan’s paddy fields out of rice production, costing vast sums each year in compensation to farmers for lost income. . .

Subsidies almost always start with good intentions but they have unexpected consequences, distorting markets at great cost to consumers, producers and tax payers.

The country’s millions of small rice-growers have thrived on the handout for decades, along with Japan Agriculture (JA), a giant network of local farm co-operatives. Many landowners pocket the government’s money while growing nothing at all. About two-fifths of the land taken out of rice production is left entirely idle. Unused land prompts regular public hand-wringing about the abandonment of the life-giving soil to weeds and rubbish.

Japanese agriculture’s biggest problem is that all but 2% of farms are smaller than five hectares and many comprise just a few fields, a fragmentation preserved by the gentan system and by other regulations. Tiny, often part-time farmers, with few economies of scale, antiquated methods and old equipment hobble the industry. The sticky rice favoured by Japanese consumers ends up costing twice or more what rice does in other countries.

To protect its wildly uncompetitive farmers, Japan has erected one of the world’s highest tariffs: the duty on imported polished rice is 777.7%. Mr Abe’s surprise decision in March to bring Japan into talks on the Trans-Pacific Partnership (TPP), a free-trade grouping, has brought these duties under pressure. Even though a final deal on TPP is far from certain, the talks are still a powerful force for change. . .

This is a significant move and an important step towards free trade.

It will involve some short term pain but Japanese producers and consumers, and exporters in other countries, including New Zealand, which want to trade there will have a lot to gain in the medium to longer term.

We’re not going to be trying to sell the Japanese rice, but will benefit from the reduction in tariffs on other products we do sell there.


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