Com Com approve’s Fonterra Studholme plant purchase

08/09/2012

The Commerce Commission has approved Fonterra’s purchase of the Studholme milk processing plant formerly owned by New Zealand Dairies.

Comparing the acquisition by Fonterra to the scenario where another bidder would acquire NZDL’s assets, the Commission is satisfied that the acquisition would not be likely to result in a substantial lessening of competition. The Commission also considers that Fonterra’s cooperative ownership structure and the regulatory environment in which it operates, together with its national raw milk pricing strategy, removes Fonterra’s incentive and ability to depress the prices it pays farmers for raw milk in the South Canterbury and North Otago regions,” said Commerce Commission Chair Dr Mark Berry.

Dr Berry added that given that the Studholme factory produces milk products for export rather than domestic consumption, and would likely continue to do so whoever acquires it, the Commission has not had to consider downstream markets in New Zealand for dairy products such as butter and cheese in this instance.

In addition to the clearance decision, the Commission also decided that it was unlikely that the Operational Agreement between the Receivers and Fonterra, which provided for the continued operation of the Studholme plant for the 2012/2013 milking season, resulted in a substantial lessening of competition.

Fonterra has, not surprisingly, welcomed the decision:

The Studholme site becomes the Co-op’s 27th processing factory and the 11th in the South Island accepting about 800,000 litres of milk a day from former NZDL suppliers and Fonterra shareholders.

Fonterra CEO Theo Spierings said the Commerce Commission’s decision provided certainty for NZDL’s suppliers and would be a welcome addition to the Co-op’s processing capacity.

“This investment in the Studholme plant underpins our commitment to the dairy industry in Canterbury, one of the fastest growing dairy regions in New Zealand. We’re pleased we have been able to offer certainty to the former suppliers of NZDL and staff at the factory.

“The Studholme site also complements our new Darfield plant operating for the first time this season.”

“We’ve been operating the Studholme plant for the receivers over the past couple of months to ensure supplying farmers could sell their milk from the start of this season,” he said.

“We started collecting milk from NZDL suppliers at the beginning of August and processed it at other sites and fired up the Studholme plant on August 14. We’re now processing more than 800,000 litres per day of milk into whole milk powder for export.”

This is very good news for the suppliers and workers at the plant who have been in limbo since NZ dairies went into receivership.

It is also good news for wider South Canterbury and North Otago both of which would have suffered economically and socially  had the factory closed.


Rural round-up

08/07/2012

1080 doesn’t contaminate waterways new study shows:

New research by NIWA scientists shows 1080 poison does not contaminate waterways.

1080 is used throughout New Zealand to control animal pests – mainly possums – which spread the livestock disease bovine tuberculosis.

Over the past three months, scientists have placed large amounts of 1080 in a trial catchment on the West Coast and then simulated rainfall in the area.

The aim is to understand how 1080 – a natural toxin – moves through or across soil into waterways and if the run-off degrades the quality of water.

Dr Alastair Suren is the freshwater ecologist who led the research and says the study found that during rainfall 1080 diluted to the point where it became nearly undetectable. . .

Rabobank runs masterclass – Hugh Stringleman:

Some “scary numbers” on world food security were addressed by 50 participants, including six New Zealanders, in the inaugural Global Masterclass held by Rabobank in the home country, Netherlands.

Speakers from the United Nations and giant agribusinesses such as Unilever and Cargill impressed upon North Island sheep, beef and deer farmer William Oliver the need for greater efficiency in farming with labour, energy and capital.

“I came home to see the opportunity in everything and bring more passion and inspiration to my farming,” Oliver said.

The theme of the vent was to promote rural entrepreneurship to fill the world’s food needs . .

My farmer was one of the six New Zealanders at the Masterclass. You can read more about it here and here.

Pear investment coming up rosy – Peter Watson:

In more than 30 years growing pipfruit, Bruce Fraser hasn’t seen a pear with such promise.

Shaped more like an apple and bright red, PremP109 has been stirring up a storm since being released in tiny amounts last year.

Dubbed a “papple” in Britain, it has been selling at Marks and Spencer stores for an eyewatering 1GBP (NZ$2.10) a piece and returning growers back here more than $100 an 18kg carton, a staggering sum at a time of hardship in the industry. . .

Fontera eyes up Studholme plant – Andrea Fox:

The small size of New Zealand Dairy’s Studholme plant means it is well-suited for use in short and specialised manufacturing runs, Fonterra says in an application eyeing up the factory.

Fonterra has a deal to buy the dairy-processing assets of New Zealand Dairies, which is in receivership. But while awaiting a Commerce Commission decision, the dairy giant wants to buy the milk of the failed company’s contracted farmers and operate the plant.

Exporter New Zealand Dairies was founded six years ago to build a wholemilk powder processing plan on 55ha at Studholme. The plant was commissioned in 2007 at a cost of $108m. . .

Winemaker introduces smaller bottles:

Mission Estate has been commended by anti-alcohol campaigners for introducing New Zealand’s first 500ml bottle of wine.

The Hawke’s Bay winery, the nation’s oldest, is now selling sauvignon blanc and syrah in the smaller bottles in a bid to make wine more attractive to modern lifestyles. The standard bottle of wine is 750ml, or 7.7 standard drinks.

Mission chief executive Peter Holley and winemaker Paul Mooney read research that showed New Zealanders were becoming older, increasingly urban and living in smaller family units. . .

Sanford sells virus hit Northland oyster farms  –

Fishing company Sanford has sold its Pacific oyster farms in Northland to Aotearoa Fisheries.

Sanford closed its Kaeo processing plant in December because of a virus that killed many of the juvenile oysters and the likely reduced oyster harvest.

Despite having confidence that there was potential to breed new oysters that have some resilience to this virus, it had decided that it made more sense for it to concentrate on its expanded Greenshell mussel business, Sandford said. . .

“Meating” of minds on advancing sector – Shaan Te Kani:

INDUSTRY ORGANISATIONS and commercial companies will work much more closely together in future, says Beef + Lamb NZ chairman Mike Petersen.

“There has been a bit of discussion certainly since Keith Cooper’s resignation from our board around election time – about the value of industry organisations,” Petersen said at the Federated Farmers conference in Auckland.

“Our view is we are a farmers’ organisation…. It should be up to the farmers to decide whether they want to invest in research programmes, extension work, economic anaylysis, skills and trade programme or market access. . .

Growers fear limits to their water take

SETTING limits on irrigation use in the Poverty Bay Flats was one of the main concerns raised by farmers and growers at the Fresh Water Advisory Group community meeting yesterday.

More than 50 people attended the meeting at Bushmere Arms, which discussed the draft freshwater management plan with Waipaoa users.

Advisory group representatives delivered the plan’s vision, which is to ensure the long-term sustainability of freshwater resources as well as considering economic and social activities. . .

So You Think (NZ) Reitred to stud:

The curtains have been pulled on the racing career of one of New Zealand’s most successful racehorses seen in recent times with the New Zealand bred Karaka graduate So You Think (NZ)officially retired to stud.

Announced by Coolmore yesterday, So You Think (High Chaparral x Triassic) has subsequently been withdrawn from Sunday morning’s Group 1 Eclipse Stakes where he was odds on to claim his 11th Group 1 race.

The son of High Chaparral was found to be lame after exercising yesterday morning in Ireland and it appears he has pulled a muscle in his hind quarter which precludes him from running in the Eclipse Stakes. So You Think will enter quarantine this week as originally planned before making his trip back to Australia to commence stud duties. . .

Potatoes NZ welcomes step towards fresh potato exports:

Potatoes New Zealand has welcomed an Australian Government draft report which is expected to open the door to the export of fresh potatoes for processing from New Zealand to Australia.

The Australian Department of Agriculture, Fisheries and Forestry (DAFF) draft report proposes that the importation of fresh potatoes for processing into Australia from New Zealand be permitted subject to import conditions.

Potatoes New Zealand Chairman Stuart Wright said that the news was very encouraging for the New Zealand potato industry and it was hoped the Australian market could be open to New Zealand for the 2012-13 season. . .


Where there’s milk . . .

28/03/2009

The grapevine reckoned that Don Brash and Keith Turner (former National leader and CE of Meridian Energy respectively) had been showing interest in a dairy farm that’s for sale in our neighbourhood.

The farm’s still on the market but Rural News reports  that the two men are directors of New Zealand Milk which is planning to build a factory to produce skim and whole milk powder near Glenavy, just north of the Waitaki river.

If it goes ahead, South Canterbury suppliers will be spoiled for choice. New Zealand Dairies has a factory at Studholme, near Waimate, and Fonterra has a factory at Clandeboye, north of Timaru. 

In spite of the uncertain outlook for commodities in international markets, this indicates that there’s still plenty of people who believe that where there’s milk there’s money to be made.


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