Finlayson tribute to Groser

February 11, 2016

Minister for Treaty Negotiations Chris Finlayson is one of parliament’s best debaters.

In the debate on the Prime Minister’s statement he pays tribute to Trade Negotiations Minister Tim Groser who left without delivering a valedictory statement.

Hon CHRISTOPHER FINLAYSON (Minister for Treaty of Waitangi Negotiations): It is great to be back after a glorious summer in this magnificent capital city. I had a great summer. There is nothing more enjoyable than charging up Mount Kawakawa to look out on this city—the best views in Wellington .

Unlike the previous speaker, Jacinda Ardern , I thought that the Prime Minister gave an outstanding address to inaugurate the political year. I was particularly interested when the Prime Minister outlined a number of significant New Zealand sporting achievements. He mentioned the Sevens , our great cricket team, and Lydia Ko’s brilliance. I was just a little disappointed that he did not mention another great New Zealand sporting achievement, namely, my hole in one on the 11th at the Royal Wellington Golf Club at 1.30 p.m. on 29 December 2015. Mr Faafoi would be interested in this, because I know he plays at Heretaunga . It was a 7 wood, brilliantly teed-off, went slightly to the left in—well, it was about 160 metres in a northerly. It jumped the bunker and slid into the hole. I was very proud of that.

I want to begin by paying tribute to my colleague Tim Groser , who is about to leave for the United States . He and I came into Parliament together in 2005, and I was his associate arts, culture and heritage spokesperson until Tim was reshuffled out of that role and I took it for myself. In 2014 Tim and I won the party vote in New Lynn and Rongotai , embarrassing our high-profile opponents. In fact, Tim almost became the member of Parliament for New Lynn, which was slightly better than I have ever achieved against Mrs King , although Tim did have the benefit of being up against David Cunliffe . I am very interested to hear that Annette King may be standing down as the MP for Rongotai—a very important political development, because it will have the effect of turning Rongotai into a hair-trigger marginal. Whenever I am out campaigning with the people in Rongotai, the voters always say they will switch to me once Mrs King retires. So I used to say I would win the seat in 2038, but I have been doing some very hasty recalculations and I think it could be as early as 2023.

Tim and I were bench mates for our first term. We used to sit in the second row, where David Shearer sits now, and we often used to come down to question time reading our Spectators until Marian Hobbs , the then-MP for Wellington Central , told us that, no, that was not very wise. We should try to look riveted when the speaker is asking questions—very sound advice that I have always remembered. I am very sorry that Tim has left our presence without giving a valedictory speech, so I thought I would give one for him. I would like to outline what I think are his top five contributions in office, even if Tim would have done a far better job telling us about his achievements than I will be able to do. Over the course of my speech, I will avoid quotes from Napoleon, Juvenal , and Thucydides .

Tim’s achievements were momentous. The first one, of course, was the Trans-Pacific Partnership (TPP) agreement. It is the obvious one. He achieved what many people thought was unachievable. Secondly, there was the Taiwan economic agreement and the Hong Kong free-trade agreement, which made New Zealand the first country to have trade deals with all of China. He concluded a free-trade agreement with the ASEAN-Australia-New Zealand arrangement. He positioned New Zealand’s trade relationship with Asia in a very effective manner. He also concluded a free-trade agreement with Korea. These all prove the value of free-trade agreements, as traditional Labour leaders have always said. The rise in the volume of New Zealand’s exports has been huge, and the same will happen with the TPP agreement, which makes Labour’s approach both so bizarre and so disappointing given its very positive contribution to trade over the years.

Tim was a very respected voice overseas for New Zealand business, and I am sure he is going to continue to be so in his new role. He spearheaded overseas business trade missions to introduce New Zealand companies to new markets. Whether at the World Trade Organization , whether at Washington or Beijing, people listened to him—they had no choice—and New Zealand businesses all benefited from it. Finally, he was a very effective Minister for climate change issues. The work he did behind the scenes on international agreements earned him significant respect. The recent Paris agreement was based on the New Zealand proposal. I know the Greens are looking disconsolate because they think they have a monopoly of virtue on these matters, but Tim was a very effective Minister in that area. I should not finish without mentioning his glorious reign as the Minister of Conservation between 2008 and 2010—as Tim himself calls it, “the golden age of conservation in New Zealand”—until he was fired by the Prime Minister. I am sure all of us wish him all the very best for the future, and I know that he will be a very effective ambassador to the United States. . . 


TPPA true & false

February 4, 2016

The National Party has a webpage giving the facts and refuting the myths on the Trans Pacific Partnership Agreement (TPPA) which is being signed in Auckland today.

Don’t believe that?

Chapman Tripp says:

The TPP began life modestly as an initiative between New Zealand and Singapore, but the ambition was that it would evolve into a trans-Pacific agreement.  The first recruits were Chile and Brunei and the net has subsequently extended to Australia, the United States, Canada, Japan, Malaysia, Mexico, Peru and Vietnam.

New Zealand now finds itself in the vanguard of the new wave of economic globalisation.  This is a coincidence of the worldwide focus on FTAs to further integrate economies, the prominence of Asia, and the United States’ and Japan’s renewed interest in the Pacific Rim. 

Some find this uncomfortable.  Many, including the protesters at Seattle, found the birth of the WTO in 1994 similarly uncomfortable.

Difficult as change can be, this is an opportunity which will not come again.  In its final form, the TPP is the biggest free trade deal in a generation and will establish the architecture of Asia Pacific trading relationships for decades to come.  . . 

and concludes

. . . Labour’s frustration is understandable.  The TPP does not appear to include the specific reservation of rights Labour wanted.  New Zealand negotiators could perhaps have sought a more nuanced provision, such as appears in the NZ-Korea FTA, which arguably preserves some scope to expand the OIA screening regime.  It is hard to see that the more absolute language in the relevant TPP annex was a deal breaker for other negotiating parties. 

Negotiating parties tend not to publicly announce their bottom lines in advance to avoid painting themselves into a corner, as Labour has effectively done.  One cannot, of course, sensibly weigh up the overall merits or demerits of a 6000 page 12 party agreement by looking only at one provision.  To attempt this is to miss the wood for the trees. 

None of the signatory countries will be perfectly satisfied with the deal.  Each will have a particular clause or clauses that they would prefer were not there.  The US Republican Senator, Orrin Hatch, for instance is chagrined that the IP chapter grants only five, and not eight, years’ protection to biologics. 

But if support for the deal was premised on perfection, then it would go the way of the Doha Round.  It is no coincidence that TPP opponents play the single issue game.  Conflating whether one gets everything one wants, and whether the deal is acceptable overall, is a classic black hat strategy. 

The art of negotiating involves being able to push hard for one’s positions, then to stand back and work out whether (even if one did not get all one wanted) the deal on the table is better than no deal at all. 

Here, the question is even more stark.  Would New Zealand be better off inside, or outside, the tent?  MFAT’s national interest analysis reaches a firm conclusion, having weighed everything up over 276 pages.  It is respectfully suggested that this conclusion deserves to be afforded more weight than anyone’s position based on a single issue.

Those last two paragraphs nail it.

The deal isn’t perfect but it is better than no deal at all and New Zealand is better inside the tent than outside it.

The usual nonsense at Waitangi purports to be about the TPPA threatening the Treaty but the Federation of Maori Authorities is cautiously supportive:

. . .Chair Traci Houpapa said there were benefits and opportunities for Māori and all New Zealanders.

“We’ve analysed those documents ourselves and while we have a level of comfort we agree with the 12 month consultation process that the signing on the 4th of February triggers.”

Ms Houpapa said the removal of some or most tariffs for exporters would have financial benefits for the federation’s regional members.

“Māori have a predominate footprint in primary sector industries, we are land, water or sea based so our exporters have obvious benefits if the removal of tariffs are in place and TPP provides for that.”

FOMA is happy with the provisions within the agreement that acknowledge the Treaty of Waitangi, which say it must be enshrined, but FOMA recognises further analysis of what that means is required. . . 

“We recognise TPP is a complex trade arrangement which requires time to fully digest and understand. Our members support the trade benefits and want assurance that our national sovereignty and Treaty partnership are maintained. We welcome proper engagement with government and our members on this important matter,” said Ms Houpapa.

Proper engagement will achieve what all the protests prefaced on political agendas won’t.

Charles Finny says the TPPA deserves praise from Maori:

I believe that rather than being inadequate in its protections for Maori, TPP is if anything a taonga in the way it protects the rights of the New Zealand Government to discriminate in favour of Maori. This in turn, I think, adds enormous mana to Maori.

I feel Maori are being poorly advised from some quarters and it is essential that ministers and government officials spend even more time explaining the protections for Maori in the agreement and the trade benefits that will flow to Maori from it. These benefits are substantial.

TPP is an agreement between 12 countries. Pretty much all the 12 jurisdictions are home to indigenous minorities – for example, the First Peoples of the United States, Canada, Mexico, Peru, Chile, the Aboriginal people in Australia, the Malays in Singapore and Malaysia, and the Ainu in Japan.

Yet none of these peoples is mentioned in the main text of the deal and none of their Governments has secured agreement from the other members that they should be allowed to discriminate in favour of them.

In contrast Maori are mentioned, as is the Treaty of Waitangi. Article 29.6 of TPP is actually titled “Treaty of Waitangi”. It says that “provided that such measures are not used as a means of arbitrary or unjustified discrimination against persons of the other parties or as a disguised restriction on trade in goods, trade in services and investment, nothing in this agreement shall preclude the adoption by New Zealand of measures it deems necessary to accord more favourable treatment to Maori in respect of matters covered by this agreement, including in fulfilment of its obligations under the Treaty of Waitangi”.

This is pretty much the same clause that has been included in all free trade agreements (FTAs) New Zealand has negotiated since 2001. It has stood the test of time. It has allowed multiple Treaty settlements to be completed and has not had (as some critics claim will happen under TPP) “a chilling effect” on Government’s ability to adopt policies more favourable to Maori than other New Zealanders or nationals of these FTA partners.

TPP’s protection of the Treaty goes even further than earlier FTAs. It states “the parties agree that the interpretation of the Treaty of Waitangi, including as to the nature of the rights and obligations arising under it, shall not be subject to the dispute settlement provisions of this agreement.” This means it is entirely up to New Zealand to determine if any discrimination has occurred because of the treaty (so long as this is not a disguised restriction on trade).

I am frankly amazed the US and others have agreed to this provision. Our ministers and officials have done a great job achieving this. All Maori should be saying: “Well done!” . . 

He also posts on Facebook:

TPP contains two types of dispute settlement. In the media and political criticism the two are often confused. There is the standard (in WTO and all our FTAs apart from CER – the reason why apples took so long to resolve)provisions which allow parties to the agreement to challenge breaches of the agreement. This is a purely government to government process and applies to the full agreement unless specified (e.g. interpretation of the Treaty of Waitingi the dispute settlement provisions do not apply). Then, in the investment chapter only, there is the investor state dispute settlement mechanism. This allows a company to challenge a government if it believes that government has breached its commitments in the investment chapter only. Many of the critics (who should know better) suggest that governments can be sued for breaches of outside of the investment provisions. This is not possible.

It is important to stress that TPP is worded differently to NAFTA and the Australian investment treaties that were used to challenge plain packaging of cigarettes. The critics often cite these agreements as examples of why we should fear ISDS without noting the fact that TPP has been drafted with the sloppy drafting in earlier agreements in mind.

New Zealand has been agreeing (indeed advocating for ) ISDS provisions in investment treaties and FTAs since the late 1980s (see for example the original China NZ Investment protection agreement). To date the NZ Government has yet to face a challenge.

Put simply I believe these provisions provide useful security for NZ investors offshore. Some of the governments we trade with and have FTAs or investment treaties are far more likely to breach these agreements than we are.

There are multiple exclusions (e.g. our Overseas Investment laws) and multiple acceptances of our right to regulate to protect the environment, to protect human health and safety, to discriminate for Maori under the Treaty of Waitangi etc to ensure that TPP will not have the type of chilling effect on policy making that the critics maintain. And, on top of the above protections, tobacco is completely carved out of the agreement so no worries there.

But is you want to nationalise huge hunks of the economy without compensation – you do have a problem. As you would if you tried to use human health as a justification for a policy if there was no science to justify the policy. Until recently I did not think that future NZ Governments would act in this way. This is why I think we have nothing to fear and that these provisions can only benefit NZ.

Stephen Jacobi wrote an open letter to Labour leader Andrew Little. It’s worth reading in full, I have chosen the extract with most relevance to farming:

. . . I agree that the dairy aspects of TPP are not as good as they could have been and as we had hoped.  But they are in the view of the negotiators and the dairy industry the best that could have been achieved in the circumstances.  Dairy still benefits more than any other sector from tariff cuts in key markets and the establishment of new tariff quotas.  The meat deal – specifically beef to Japan – is a significant market opening about which the industry has welcomed. Without this we will not be able to compete with Australia which already has an FTA with Japan. To call the rest ‘not much’ is a serious under-estimation – tariff reductions and/or elimination for horticultural products including kiwifruit, wine, wood products and seafood cannot so easily be dismissed. Addressing tariff and non-tariff barriers for manufactured products like health technologies and agricultural equipment is also significant.  This will result in the creation of new markets as you suggest. . . 

Duncan Garner says the political consensus on free trade is over:

After decades of supporting free trade, Labour has chosen to veer left into the bosom of New Zealand First and the Greens and oppose the TPP. It’s short-sighted and totally hypocritical, in my view. It looks like the party has had its strings pulled by anti-TPP academic Jane Kelsey.

This is a serious and controversial departure for Labour, and it may yet hurt the party among middle New Zealand voters.

Do these politicians know that our bottled wine can be sold tariff-free in Canada, Japan and the US on day one of the TPP being implemented? Why would you oppose that after we as a country have fought for this for so long? Most fruit and other produce can be exported tariff-free too, as a result of the TPP.

I travelled the world with Labour and National Party ministers for years, watching them fight bloody hard for market access for our exporters. I have seen a block of New Zealand butter selling for $25 in Japan; the same with cheese. Some of these tariffs are so high our exporters are locked out.

I’ve also seen Phil Goff, Helen Clark, John Key, Mike Moore and Tim Groser invest thousands of hours over the years for this sort of deal. Rather than accuse them of selling out, I’d argue they’ve done a great job. . . 

The truth is Labour has taken a massive risk opposing the TPP. I sense the silent majority understands we have to be part of it, despite the noise from the usual suspects.

Labour is divided and bleeding over the TPP. More Labour MPs want to voice their opinions in support but they’ve been silenced.

Ms Clark, Mr Key, Mr Moore, Mr Groser and David Shearer aren’t idiots. They know New Zealand has no choice but to be on board. Foreign investment is crucial into New Zealand too.

My friend runs a hotel in rural Waikato. The Chinese bought it recently. They have invested thousands into doing it up; they employ 33 locals in and around Tirau and Rotorua. Without the Chinese owners it would have closed and 33 Kiwis would be out of work. We have no option but to be international traders. Without it we die, slowly.

I predict the sky won’t fall in. And exporters stand to make billions more in the years ahead.

We won’t get rich buying and selling to each other; we need barriers broken and global doors open.

That’s why we must continue to fight for international trade deals — knowing there will always be a boisterous but small mob who hate the idea, no matter what the facts. 

Brian Easton who is no apologist for the right, asks can we afford not to adopt the TPPA?

. . . While there has been much focus on the TPP deal, there has been hardly any mention of the WTO (World Trade Organisation) agreement in Nairobi which prohibits agricultural export subsidies. Some 30 years ago a trade negotiator commented to me that getting rid of this dumping might be the best single thing we could do for our exporters. Not only would it stop the undercutting of their markets but it would force domestic agricultural reform because the dumping nations could no longer export the surpluses arising from their subsidies. There is not a lot of this subsidising going on at the moment but without an agreement export subsidies are likely to come back – to New Zealand’s detriment.

What was not always mentioned was that the chair of the WTO agricultural committee which negotiated the deal was a New Zealand ambassador, who is the fifth New Zealand chair in succession. This not only reflects the excellence of our Geneva ambassadors and the priority we give to agriculture in the WTO, but that the powerful – most notably the US – trust New Zealand to do a good job. That trust arises from the way we behave in other trade negotiations, including the TPP. The implication is that if we defaulted on the TPPA we would damage that trust and our ability to function effectively in a wide range of other international negotiations we care about, including on climate change.

That puts us in an extremely invidious position over the TPPA. Sure, we could turn it down, losing both its benefits and its downsides. Were we to do so, however, we would compromise the trust our international activity depends upon, especially the possibility of other trade deals which would open up markets currently restricting our exports. . . 

. . . Japan and the US (indeed the whole of the North American bloc) are members of the TPP. We have been struggling for ages to get deals with these two but have been too low on their pecking order to be noticed. So you might think of the TPPA as a means of getting the deals.

That is a positive, but of course the deals have to be favourable to us. Many argue they are not although their vehemence is offset by those who argue the opposite. The truth is that there are positives and negatives and different people balance them differently. In my opinion it is not much use focussing on a subset of the outcomes and ignoring everything else. Deals are about giving and taking.

The logic in this column is that we now do not have much choice about the TPPA. The government is trapped into agreeing to it because rejecting it has implications for other trade deals and our wider international relations. That is probably what our MFAT officials are advising, although no doubt there are many diverse views in there, just as there were with Vietnam. Here is my best guess about what is likely to happen.

There is a signing of the agreement in Auckland this Thursday. The exercise is primarily ceremonial – agreeing to a common text and exhibiting solidarity. I suppose the protests outside are ceremonial and for solidarity too.

The twelve partners then go away and prepare for the implementation of the text. Some things can be done by regulation, some require a change in law. The degree to which each partner has to do this differs according to their constitutional arrangements. . . 

 

By now there are so many imponderables that there is insufficient room in a column to pursue them all in a balanced way. My guess is that, given the way we are trapped by the wider international issues, the cautious advice is to proceed on the path of implementing the legislation for the TPPA, making as much international progress elsewhere. We can then review whether we really want to go ahead with the implementation. Legislation can always be reversed, agreements abrogated, although if the government changes its mind it is better that some other partner pulls the plug. Much of what is due to happen will be less ceremonial than this Thursday.  

And Prime Minister John Key says:

. . . “Opponents claim we’re giving away our sovereignty and that’s completely wrong – the TPP has almost identical provisions to the China free-trade agreement.”

Mr Key said other countries would not be able to write New Zealand laws and the TPP didn’t increase the cost of pharmaceuticals.

“The TPP is our biggest free-trade deal, successive governments have worked to get free trade with countries like the United States, Japan and Canada for 25 years,” he said.

“It will create significant new trade and economic opportunities for New Zealand… it gives our exporters access to 800 million customers in 11 countries across Asia and the Pacific.”

And those new opportunities will create jobs here, increase our GDP and earn us the money we need to pay our way.

The deal isn’t perfect but it’s better than what we’ve got and a long way better than what we’d have if our competitors were in the warmth of the tent and we were left out in the cold.


Quotes of the Year

December 31, 2015

“It’s part of the foundation of everything we do. It forms the frame of our existence, both in business and our values in life. It’s very powerful. For us, it’s also about being part of a small community. We’re part of the Waitaki district but at the forefront of it all is our little Papakaio community. We all grew up and went to primary school here. I met my wife in primer one. A part of the responsibility of living in a small village is that you contribute to the village. We’ve all been involved in supporting the creation of the community centre, the tennis courts, the swimming pool, all those sorts of things.Ian Hurst.

“I’m getting the opportunity to indulge in stuff I really like for this and I do really like New Zealand’s native birds, and this project means I get to draw a whole lot of them, on a cow.

“At the moment I’m drawing one of our native birds that still exist [fantail], and then I will be drawing the ones that don’t.” – Joshua Drummond

It’s not that we don’t want Kiwis to achieve success, it’s that we don’t want them to change once they’ve achieved it. Or, as my colleague put it, they can be winners, but they shouldn’t be dicks. Heather du Plessis-Allan

  “I chose a nice tight turd and threw it as far as I could.” Adam Stevens  –  on his win in the cow pat throwing competition at the inaugural Hilux NZ Rural Games.

“This is obviously not a zero-hour contract. It could perhaps be better described as a zero-payment contract — . . “ Steven Joyce

” But I can no longer be bothered getting emotionally het up about people who take a different perpsective to mine. Unless, of course, they are socialists.” – Lindsay Mitchell

“I cannot pretend I am without fear. But my predominant feeling is one of gratitude. I have loved and been loved; I have been given much and I have given something in return; I have read and traveled and thought and written. I have had an intercourse with the world, the special intercourse of writers and readers.

Above all, I have been a sentient being, a thinking animal, on this beautiful planet, and that in itself has been an enormous privilege and adventure. “- Oliver Sacks, professor of neurology at the New York University School of Medicine and author, on learning he has terminal cancer.

This is a Government that believes that what works for the community is what works for the Government’s books. So every time we keep a teenager on track to stay at school long enough to get a qualification or have one more person pulled off the track of long-term welfare dependency, we get an immediate saving, of course, and an immediate benefit for those individuals and for the community, and a long-term saving in taxpayers’ money – Bill English

“The nature of by-elections is it’s a very short period of time. We devoted a couple or three weeks, as the party does, to select the candidate Bit simpler for Winston; he just looks in the nearest mirror and selects himself.” Steven Joyce.

. . .  I’ve never disliked religion. I think it has some purpose in our evolution. I don’t have much truck with the ‘religion is the cause of most of our wars’ school of thought, because in fact that’s manifestly done by mad, manipulative and power hungry men who cloak their ambition in God. – Terry Pratchett

The most important steps the Government takes are those steps that support the confidence of businesses to invest and put more capital into their business, and to therefore, in the long run, be able to pay higher wages. The Government does not influence that directly. However, we can contribute by, for instance, showing fiscal restraint and persisting with  economic reform. This enables interest rates to stay lower for longer but enables businesses to improve their competitiveness and therefore their ability to pay higher wages. – Bill English

“Schools are not there merely to teach in the old words of reading, writing and arithmetic, but they’re there to transition young people, especially at high school, into the real world,” . . . – Canterbury University dean of law Dr Chris Gallivan

“I have built a confirmation bias so strongly into my own fabric that it’s hard to imagine a fact that could wonk me,” . . . . “At some level, the news has become a vast apparatus for continually proving me right in my pre-existing prejudices about the world.” – Jesse Armstrong

 ”You can’t leave a big pig in the middle of the road – it’s a bit dangerous.” An unnamed Dunedin woman whose close encounter with a pig she tried to rescue left her nursing bruises.

“Politics is not entertainment,” he says. “That’s a mistake of people who are acute followers of politics as commentators or people from within the Westminster village.

“For the voters it’s not entertainment, it’s a serious issue, it’s a serious thing that means a great deal to their lives. It is their future.” – Lynton Crosby.

. . . outside politicised bubbles, most do not think in terms of “left” and “right”. Outside the political world, most think in terms of issues to be addressed in a way that is convincing, coherent, and communicated in a language that people understand. Statistics and facts won’t win the support of millions; we’re human beings, we think in terms of empathy. Stories are more persuasive, because they speak to us emotionally. . . – Owen Jones

In the animal world there’s a miracle every day, it’s the same with humans if you just give them a chance.Dot Smith.

I sometimes feel that ‘my’ is a word that blocks love… if we thought of our children, our dog, our world, our dying oceans, our disappearing elephants, perhaps we would be able to change our mind set and work with each other to save lives, share happiness, and even save our world from the sixth great extinction which scientists fear is imminent. – Valerie Davies

I believe in smaller government.

I also believe the best way to achieve smaller government is to deliver better government. – Bill English

. . . My problem with such people is twofold. First, they believe that the perfect society is attainable only through the intervention of the state, and that this justifies laws that impinge heavily on individual choice. And second (which is closely related), they have no trust in the wisdom of ordinary people. They seem incapable of accepting that most of us are capable of behaving sensibly and in our own best interests without coercion or interference by governments and bureaucrats.  – Karl du Fresne

. . . this Government has always given credit for the stronger economy to New Zealand households and businesses, which, in the face of a recession and an earthquake, rearranged the way they operated, became more efficient and leaner, and got themselves through a very difficult period. We have always attributed the strength of the economy to the people who are the economy. – Bill English

The real test is not whether people have an opinion, it is whether they are willing to put the money up. –  Bill English

Tree and sea-changers may love the rolling hills and open spaces, but they can’t then object to the dust, smell and noise that are part of everyday life in the farming zone. – Victorian Farmers Federation president Peter Tuohey

If a trade deal threatened to wipe out a million dollar regulatory asset you owned, you’d fight it too. Just like the mafia didn’t want the end of prohibition.Eric Crampton

. . . And when we say ugly, we mean ugly from each perspective – it doesn’t mean ‘I’ve got to swallow a dead rat and you’re swallowing foie gras.’ It means both of us are swallowing dead rats on three or four issues to get this deal across the line. Tim Groser

I’ve always said worry is a wasted emotion. You have to plan for some of these things. We knew we could possibly have someone in the bin at some stage, so it’s just a matter of making sure you have everyone knowing what they have to do – Steve Hansen

“I want to enjoy this success: how could you get enough of this? We will worry about that afterwards. I just want to have a good time with a great bunch of men having played in a wonderful World Cup final. I am really proud of this team and being able to wear the jersey. If you get moments like this, why would you ever call it a day?Richie McCaw

“To think that Darren Weir has given me a go and it’s such a chauvinistic sport, I know some of the owners were keen to kick me off, and John Richards and Darren stuck strongly with me, and I put in all the effort I could and galloped him all I could because I thought he had what it takes to win the Melbourne Cup and I can’t say how grateful I am to them,” Payne told Channel Seven after the race. “I want to say to everyone else, get stuffed, because women can do anything and we can beat the world.

“This is everybody’s dream as a jockey in Australia and now probably the world. And I dreamt about it from when I was five years old and there is an interview from my school friends, they were teasing me about, when I was about seven, and I said, “I’m going to win the Melbourne Cup” and they always give me a bit of grief about it and I can’t believe we’ve done it.  . . .Michelle Payne

“We have just come 11,000 miles to congratulate the best rugby team in the world. But ladies and gentlemen, what the hell am I going to say to the Aussies next week?” Prince Charles

Here’s the thing — none of us get out of life alive. So be gallant, be great, be gracious, and be grateful for the opportunities that you have. Jake Bailey

nzherald.co.nz's photo.

 


Rural round-up

October 17, 2015

Progressive Meats founder Craig Hickson wins entrepreneur of the year – John Anthony:

A Hastings businessman who started a meat processing company more than three decades ago has taken out New Zealand’s top entrepreneur award.

Progressive Meats founder Craig Hickson was selected from a field of six New Zealand entrepreneurs to be named EY Entrepreneur of the Year for 2015 at a dinner in Auckland on Thursday.

Hickson and his wife Penny started Progressive Meats in Hastings in 1981 with six staff working in a lamb processing facility.

The company now employs more than 300 staff and has processing facilities for lamb, beef, venison and rams. . .

Share register challenge for SFF – Dene Mackenzie:

Silver Fern Farms faces a new problem of how to manage its share register after the Dunedin meat company yesterday received overwhelming support for its joint venture with China’s Shanghai Maling.

The co-operative received 82% votes in favour of the proposal. Shanghai Maling, a listed company in China, will vote on the deal on October 30.

But with the Chinese Government-controlled Bright Food Group owning 38% of Shanghai Maling, and supporting the deal, the vote is expected to easily pass. . . 

TPPA will advance globalisation of agriculture, trade minister says – Gerald Piddock:

Trans-Pacific Partnership Agreement (TPPA) negotiations will trigger more liberalisation of world wide agricultural trade, says Trade Minister Tim Groser.

Once started, the trade process would be difficult to stop, Groser told journalists at the International Federation of Agricultural Journalists Congress in Hamilton.

“We are in my opinion…in the early stage of the globalisation of world agriculture,” he said.

However, he acknowledged that removing agricultural subsidies would be a difficult task for developed  countries. . . 

NZ Merino, on quest to add value to commodities, increases annual profit 21% – Tina Morrison:

(BusinessDesk) – New Zealand Merino Co, a wool marketer which aims to develop higher-value markets for sheep products, posted a 21 percent lift in full-year profit and said it’s on track to double the value of the business in the three years through 2016.

The Christchurch-based company said profit increased to $2.3 million in the year ended June 30, from $1.9 million in 2014, and $405,000 in 2013. Revenue fell 6.1 percent to $109.4 million from the year earlier, while cost of sales fell 7.7 percent to $98.4 million and expenses slid 4.2 percent to $12.8 million. It will pay shareholders, including 536 wool growers, a dividend of $1.2 million, up from $942,000 a year earlier. . . 

Americans are biggest investors in NZ dairy land:

United States investors were the largest investors in our dairy land during 2013-2014, analysis by KPMG has revealed.

In the report on Overseas Investment in New Zealand’s Dairy Land, KPMG has analysed Foreign Direct Investment (FID) decisions by the Overseas Investment Office (OIO) for the 2013-2014 period.

It shows that the US was the largest investor in dairy land during that two-year period – accounting for 54.4% of the freehold hectares sold, and 26.5% of the consideration paid. . .

Manuka honey lobby devises test to prove authenticity – Suze Metherell:

(BusinessDesk) – The UMF Honey Association says it has found the solution to fake manuka honey products, developing a portable device which tests for the nectar of Leptospermum Scoparium, the native manuka bush.

The manuka honey industry group, working with Analytica Laboratories and Comvita, presented the primary production select committee with a portable fluorescent test which can easily indicate whether a product is genuine manuka honey, and research defining the premium honey. Analytica executive director Terry Braggins said the development of a chemical fingerprint, based on the presence of the native bush’s nectar, could distinguish monofloral honey made by bees foraging on manuka flowers from other blended or imitation honey. . . 

 


Quote of the day

October 12, 2015

I guess, if you wanted to drive foreigners away and send a message to the world New Zealand’s not open for business, you could do it. – Tim Groser


NZ’s biggest trade deal

October 6, 2015

Prime Minister John Key has welcomed the successful conclusion of negotiations over the Trans-Pacific Partnership Agreement – New Zealand’s biggest free trade agreement.

“This agreement will give our exporters much better access to a market of more than 800 million customers in 11 countries across Asia and the Pacific, and help Kiwi firms do business overseas,” Mr Key says.

“In particular, TPP represents New Zealand’s first FTA relationship with the largest and third-largest economies in the world – the United States and Japan. Successive New Zealand governments have been working to achieve this for 25 years.”

TPP has been a significant focus for the National-led Government, as part of its wider plan to diversify the economy by building strong trade, investment and economic ties around the world.

“As a country, we won’t get rich selling things to ourselves. Instead, we need to sell more of our products and services to customers around the world, and TPP helps makes that happen,” Mr Key says.

TPP will eliminate tariffs on 93 per cent of New Zealand’s exports to our new FTA partners, the United States, Japan, Canada, Mexico, and Peru.

Dairy exporters will have access to these markets through newly created quotas, in addition to tariff elimination on a number of products.

Tariffs on all other New Zealand exports to TPP countries will be eliminated, with the exception of beef exports to Japan, where tariffs will reduce significantly.

TPP also reduces non-tariff barriers to trade, ensures fair access for New Zealand firms doing business in TPP countries and provides greater opportunities to bid for government procurement contracts overseas.

“We’re disappointed there wasn’t agreement to eliminate all dairy tariffs but overall it’s a very good deal for New Zealand,” Mr Key says.

“We’ve seen with China how a free trade agreement can boost exports of goods and services and deepen trade and investment links.

“The overall benefit of TPP to New Zealand is estimated to be at least $2.7 billion a year by 2030.

“That’s more jobs, higher incomes and a better standard of living for New Zealanders,” Mr Key says.

“Many concerns raised previously about TPP are not reflected in the final agreement. For example, consumers will not pay more for subsidised medicines as a result of TPP and the PHARMAC model will not change.

“Now the negotiations have concluded, people will see that TPP is, overall, very positive for New Zealand,” Mr Key says.

The conclusion of TPP follows recent trade agreements with Korea, Chinese Taipei, Hong Kong, ASEAN/Australia and Malaysia. The Government is continuing negotiations with a number of other countries and is actively pursuing the launch of an FTA with the European Union.

John Key's photo.

Trade Minister Tim Groser and the team of people who have been working on this for years deserve the praise they are getting.

This deal isn’t as good as it could be but it is a lot better than what we have now.

The Minister says it will deliver significant benefits to New Zealand and build on the hard-won gains from previous free trade agreements:

“This comprehensive agreement offers much better access for New Zealand goods and services in 11 important markets across Asia and the Pacific.

“TPP breaks new ground for us. It is our first FTA relationship with the United States – the world’s biggest consumer market – as well as with Japan, Canada, Mexico and Peru.

“As a result, New Zealand will now have FTAs covering our top five trading partners – Australia, China, the United States, Japan and Korea.

“We’ve seen from previous FTAs, including the China FTA, how positive they have been for New Zealand trade and investment, and therefore in supporting jobs and growth for New Zealanders.

“Not being in TPP, on the other hand, would put New Zealand at a competitive disadvantage compared to other countries,” Mr Groser says.

Tariffs will be eliminated on 93 per cent of New Zealand’s trade with its new FTA partners, once TPP is fully phased in. This will ultimately represent $259 million of tariff savings a year – around twice the savings initially forecast for the China FTA.

As a result of TPP:

  • Tariffs on beef exports to TPP countries will be eliminated, with the exception of Japan where tariffs reduce from 38.5 per cent to 9 per cent.
  • New Zealand dairy exporters will have preferential access to new quotas into the United States, Japan, Canada and Mexico, in addition to tariff elimination on a number of products.
  • Tariffs on all other New Zealand exports to TPP countries – including fruit and vegetables, sheep meat, forestry products, seafood, wine and industrial products – will be eliminated.

TPP also reduces non-tariff barriers to trade and ensures fair access for New Zealand firms doing business in TPP countries.

“TPP sets high standards in many areas,” Mr Groser says. “New Zealand is already an open, transparent and trade-friendly country, which means only a fraction of TPP’s obligations will require changes to our current practices.”

The most significant change is an extension of New Zealand’s copyright period from 50 years to 70 years. The cost of this to consumers and businesses will be small to begin with and increases gradually over a 20-year period.

“Other potentially far-reaching or costly proposals raised earlier in the negotiations were not included in the final agreement,” Mr Groser says.

“Consumers will not pay more for subsidised medicines as a result of TPP and few additional costs are expected for the Government in the area of pharmaceuticals. There will also be no change to the PHARMAC model.

“Regarding data protection for biologic medicines, New Zealand’s existing policy settings and practices will be adequate to meet the provisions we have finally agreed on,” Mr Groser says.

Investor-state dispute settlement provisions have been included in TPP, as they have in previous FTAs.

“This will give New Zealand investors more confidence and certainty when doing business overseas and does not prevent the Government regulating for legitimate public policy reasons.

“TPP also contains a provision that allows the Government to rule out ISDS challenges over tobacco control measures,” Mr Groser says.

“Overall, TPP is a very positive agreement for New Zealand, further improving access to international markets, which supports our exporters to grow and create new jobs.

“New Zealand supports the release of the text before it is signed by TPP governments but arrangements are yet to be finalised.

“TPP, like any free trade agreement, will go through New Zealand’s Parliamentary processes. We expect it to come into force within two years.”

There’s a Q&A here and more information on outcomes for specific industries here.

Some of us are old enough to remember Fortress New Zealand as it was before we opened our doors to trade.

The misguided doctrine of patronage and protectionism fostered inefficiency and divorced producers from the realities of the market. It limited what we could buy, made much of what was available more expensive and/or of poorer quality, gave far too much power to politicians and bureaucrats and provided far too much opportunity for corruption.

The TPPA hasn’t got rid of all protection. That means it isn’t as good as it could be, especially for dairy but it is an improvement on existing access and we’ll find other markets.

The people who will be hurt most by the failures in the agreement are those still behind the fortresses which add to their costs and limit their choices.

Their politicians have failed them by allowing the interests of a powerful, but small, group of sectional interests to trump the best interests of their countries.


Quote of the day

October 6, 2015

. . . And when we say ugly, we mean ugly from each perspective – it doesn’t mean ‘I’ve got to swallow a dead rat and you’re swallowing foie gras.’ It means both of us are swallowing dead rats on three or four issues to get this deal across the line. Tim Groser


Still hope for TPPA

September 30, 2015

Trade Minister Tim Groser is going to Atlanta for negotiations which could conclude the conclude the Trans-Pacific Partnership Agreement (TPPA).

Groser had been playing hard to get for the meeting, indicating a willingness to attend only if there was an improvement on the “wholly inadequate” offers of dairy market access from the heavily protected agricultural sectors in the US, Canada and Japan. . . 

Groser said last week that New Zealand negotiators could “see a very good deal for New Zealand in everything except dairy and I don’t know to characterise the deal there because it’s not a deal we could accept.”

Since then, there’s been a flurry of reports in US and Canadian media suggesting that the US is pressuring Canada to accept more dairy products from the US as part of a deal that would begin to prise open the US dairy market for New Zealand and Australian dairy products. . . 

Dairy market access is especially politically sensitive in Canada because the country faces a federal election on Oct. 19 and the country’s dairy sector is highly protected, using a system of supply management intended to match local dairy production volumes with domestic demand.

However, it appears the Harper government’s political calculus is that a dairy deal would hurt its electoral chances most in Quebec, where it is already comparatively unpopular, and that there would be political damage in being seen to walk away from a new Asia-Pacific deal and some kudos in being able to demonstrate trade opportunities for Canadian firms. . . 

This means there is still hope for the TPPA in spite of strong opposition from protected industries and those whose politics blind them to the benefits of free trade and the costs of protection.

Dairy interests must be very powerful in Canada because everyone else pays dearly for its trade barriers which increase prices and reduce choice.

Eric Crampton has a suggestion to change that with this speech he’d like to have heard from a party leader:

“Right now, Canadian dairy prices are much higher than they need to be. Mothers pay too much for infant formula; families pay too much for cheese. And the system as a whole doesn’t even benefit dairy farmers any longer: getting into the industry is expensive because buying quota eats up whatever benefits the system provides to farmers. But there is a better way.”

“We are committed to protecting the quality of dairy products on store shelves – as we are with every food product sold in Canada. But we don’t protect food quality with 300% tariffs for vegetables, fruit, or thousands of other products that cross our borders each and every day. For that, we use food inspections. The dairy quota system isn’t necessary for protecting food quality.”

“Today, we are buying back all of the dairy quota and opening the borders. Farmers should not see their retirement savings wiped out by a policy decision from Ottawa. We are able to afford to do this because dairy prices, in a competitive world market, are low enough that we can fund the buyback with a levy on all dairy products sold in Canada while still keeping prices lower than they are now. And those levies will disappear when the bill is paid in full. Canadians will have better access to the world’s products, and Canadian agricultural producers will have better access to world markets.” . . 

The economics are simple, the politics are not but Not PC shows how difficult life would be without trade in a post on the $1,500 sandwich.

. . . What would life be like without exchange or trade? Recently, a man decided to make a sandwich from scratch. He grew the vegetables, gathered salt from seawater, milked a cow, turned the milk into cheese, pickled a cucumber in a jar, ground his own flour from wheat to make the bread, collected his own honey, and personally killed a chicken for its meat. This month, he published the results of his endeavour in an enlightening video: making a sandwich entirely by himself cost him 6 months of his life and set him back $1,500. . . 

Few but the strongest anti-trade people would suggest we go back to that sort of subsistence existence.

But here in one of the freest economies in the world some people still don’t understand how much we’ve gained from free trade. The transition from the highly protected economy we had wasn’t without casualties but the gains were worth the pain.

The TPPA will bring more gains and since our borders are already so open we have little to lose.


Rural round-up

September 28, 2015

Freehold on Mackenzie Crown land not an easy ticket to millions, farmers say – Tim Fulton:

Farmers accused of making big profits from Crown land deals in the Mackenzie Basin say they are doing the bare minimum to make a living.

High Country property researcher and Lincoln University academic Dr Ann Brower says the Crown is missing out when tenure review land is sold freehold by farmers.

The median on-selling price per hectare was 493 times the Crown’s original sale price, she said. . .

Signs of movement on dairy as TPP negotiators meet in Atlanta – Pattrick Smellie:

(BusinessDesk) – News media in the US and Canada are reporting signs of a deal coming together on access for dairy products into North America as trade ministers gather in Atlanta, Georgia, for the latest round of talks attempting to conclude the Trans-Pacific Partnership trade and investment pact.

The Atlanta talks are being billed as potentially the final round of talks, although New Zealand Trade Minister Tim Groser has yet to commit to attend them, despite being in the US this week for climate change talks in New York.

He said almost a week ago that there was still no adequate offer from the key TPP dairy-producing countries – the US, Canada and Japan. Market access for dairy products and automobiles, and patent extensions for new generation bio-logic pharmaceuticals, are reportedly the only remaining sticking points of substance between the 12 countries negotiating the new Pacific Rim agreement, which US president Barack Obama is committed to concluding as part of a strategy to assert US geopolitical interests in Asia and counter the rise of China. . . 

No heavy hand – Neal Wallace:

Shanghai Maling president Shen Wei Ping has given an assurance he will not use his casting vote to exert control over Silver Fern Farms should shareholders agree to a partnership between the two food companies.

In an interview during a visit to Dunedin, Shen said the clause giving the Shanghai Maling Aquarius chairman the casting vote on the appointment of the chief executive and annual business plan, was an auditor requirement for reporting the company’s financial results.

He said the proposed deal between the Chinese company and SFF would be a true partnership with board decisions by consensus. . . 

Taggart returned as Ballance director:

Murray Taggart has been returned as a Ballance Agri-Nutrients Ward C director in the South Island after a three-way contest for the position.

Also seeking the directorship were Temuka intensive cropping and livestock finishing farmer Nick Ward and former chief executive of Silver Fern Farms Keith Cooper.

Mr Taggart, who is also chairman of meat co-operative Alliance Group, joined the Ballance board in 2009. He is a past director of CRT Society and Southern Farms NZ, past chairman of the National Meat and Wool Council and Federated Farmers, and past member of the National Board of Federated Farmers. . . 

Generic marketing questioned – Matthew Cawood:

WHEN you have powerful brands, do you need generic marketing?

Agrifood consultant David McKinna posed that rhetorical question to the recent 2015 Meat Industry Conference as part of his discussion on the rise of brand marketing.

“You don’t see your breakfast cereal in generic marketing campaigns. You don’t see generic campaigns for toothpaste. The brands do the job,” he said.

“Your industry has spent a lot of money on generic marketing. As they say in advertising, fifty per cent of it works, but we don’t know which bit.”

Dr McKinna foresees a future in which generic marketing takes a back seat, but doesn’t disappear entirely.  . . 

Government delivers National Policy Direction for Pest Management:

The National Policy Direction for Pest Management has come into effect.

MPI’s director of biosecurity and animal welfare policy, Julie Collins, says established pests are estimated to cost New Zealand’s primary sector up to $3.3 billion annually.

“Even small improvements to New Zealand’s pest management system could save millions of dollars in the long term.”

“The National Direction will support national and regional management of challenging pest issues such as wilding conifers, by ensuring consistent approaches to the way rules are set across New Zealand and that landowner obligations are clearly signalled and underpinned by robust analysis.” . . 

Wendy Harker making Holstein history in NZ – Sonita Chandar:

She may have made history by being elected the first female head of Holstein Friesian New Zealand but the new president says it will not define who she is or what she does.

Wendy Harker, a Te Awamutu breeder, is the first woman to take on the top role in the association’s 105-year history.  She has sat on the board for six years as a council member.

“I have been a part of the national team for six years,” she says. . .

Connie Sue Farmer-Wollenberg's photo.


Rural round up

September 25, 2015

AgResearch confirms 83 lay-offs, hires 27 for new roles – Fiona Rotherham:

(BusinessDesk) – AgResearch has confirmed speculation it is axing jobs, announcing plans to lay off 83 scientists and technicians because of declining investment in some areas of research and development, while hiring 27 for new roles.

AgResearch chair Sam Robinson said the Waikato-based crown research institute had to balance shifts in its sector’s research needs, and therefore revenue, with the need to respond to emerging science opportunities to maximise the impact for New Zealand’s pastoral sector.

“Declining R&D investment in some areas means that we are currently facing a significant and ongoing funding challenge in those areas,” he said. “While both private sector and government revenue is increasing in other areas, our net science revenue is forecast to be $5.3 million less for FY16 compared to FY15,” he said. . . 

Federated Farmers disappointed with AgResearch redundancies:

Further job cuts at AgResearch back up Federated Farmers concern that science capability in agriculture continues to be eroded through inadequate funding and a lack of strategic planning.

“Agriculture science is a long term investment which is difficult for governments on a short term three year election cycle, but we owe it to our future farmers, and all New Zealanders, to make the investments now, develop our capability and build the basic sciences which provide the necessary grunt to ensure commercialisation of innovation is optimised,” says Federated Farmers President Dr William Rolleston.

“We appreciate that AgResearch needs to ensure its capacity aligns with the work it has ahead of it, but the continual downsizing at AgResearch is a symptom of this bigger problem.” . . 

Napier road washout cancels wedding, isolates farmers – Simon Wong:

A wedding at a remote venue near Napier has been forced to cancel after heavy rain washed out the only road to the site.

McVicar Rd, which runs along the Mohaka River in Te Haroto, has cut off the 10 permanent residents including farmer and Sensible Sentencing Trust founder Garth McVicar.

The only road to his farm and the neighbouring Mountain Valley Adventure Lodge, where the wedding was to be held this weekend, has been completely washed out. . . 

Are microbes the key to geographical differences in wine?:

A new study of six of New Zealand’s major wine-growing regions has found that differences in flavour and aroma of wine from different areas may depend more on microbes than was previously thought.

Classically the reason that wine, and other agricultural crops such as coffee, from different places tastes and smells different was thought to be due to a range of environmental reasons such as climate and soil minerals. The idea that organisms such as microbes played a role in this was not appreciated until very recently.

Previous work by Associate Professor Mat Goddard and Research Fellow Sarah Knight from the School of Biological Sciences published in Nature’s microbial ecology journal ISME demonstrated that different regions of New Zealand have different types of the main yeasts (Saccharomyces cerevisiae) that ferment juice into wine. . . 

Positive Psa-V result on Whangarei kiwifruit orchard:

Kiwifruit Vine Health (KVH) has received a Psa-V positive test result on Hort16A and male vines on a kiwifruit orchard in Whangarei. This is the first confirmed case of Psa-V on an orchard in the Whangarei region.

All growers in the region have been advised of the situation by KVH, including best-practice advice going forward. KVH will hold a meeting for Whangarei growers next week and will be carrying out extensive monitoring in the region over the weekend.

There are a total of 49 orchards in the Whangarei region comprising of approximately 144 canopy hectares.

KVH Chief Executive, Barry O’Neil, said this new find in Whangarei is very disappointing and will be particularly hard for local growers and the regional committee. . . 

Minister welcomes passage of Korea FTA Bill:

Trade Minister Tim Groser has welcomed the passing of the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill in Parliament today.

“Under this FTA, approximately 98 percent of tariffs on New Zealand’s current exports to Korea will be progressively eliminated,” says Mr Groser.

“This FTA will play an important role in strengthening the relationship between New Zealand and Korea. It delivers significant benefits across a range of areas including goods, services, and investment by breaking down trade barriers, facilitating the movement of goods and services, and establishing a framework for resolving any trade-related issues in the future. . . 

Zespri looks forward to sales growth in South Korea following passage of Tariff Amendment Bill:

Zespri welcomes the passage of the Tariff Amendment Bill through parliament yesterday, which is a significant step towards the implementation of the Free Trade Agreement (FTA) with South Korea. The agreement will provide significant benefit for the New Zealand kiwifruit industry.

Ratification of the FTA this year would mean a 33% reduction in tariffs on exports of New Zealand kiwifruit to South Korea for next year’s kiwifruit season. During 2014, Zespri growers paid approximately $22 million in tariffs, with the rate set at 45 percent. The tariff for kiwifruit will reduce to zero over the next five years. . . 

Tariff Amendment Bill a Significant Win for Kiwifruit Growers:

New Zealand Kiwifruit Growers Inc. (NZKGI) welcomes yesterday’s passing of the Tariff Amendment Bill in parliament – a positive step toward a Free Trade Agreement with South Korea.

NZKGI president Neil Trebilco said cutting the tariff is a big win for kiwifruit growers.

“The agreement will eliminate a 45 per cent tariff on New Zealand kiwifruit over five years, creating significant savings for growers.”

“The agreement will also bring about parity with Chilean competitors who have been on a zero tariff since concluding their own Free Trade Agreement in 2004.” . . 

Fastline's photo.
Not just during harvest and not just farmers – many who service and supply farmers and work in businesses which turn what comes off the paddock in to what’s put on the plate, also work long and irregular hours. And of course, lots of other people work long and irregular hours in lots of other jobs.


Rural round-up

September 24, 2015

Groser: TPPA not a gold-plated deal – Patrick Smellie:

New Zealand negotiators expect to conclude a Trans-Pacific Partnership Agreement (TPPA) deal with some improved access for dairy exports to the highly protected markets of North America and Japan but it won’t be a “gold-plated deal”, says Trade Minister Tim Groser.

He acknowledged that comments from Prime Minister John Key on Monday, that whatever deal was achieved would be “at least the very best we can do”, had been interpreted as a sign of a poor deal on dairy in the offing.

But Mr Groser told BusinessDesk that New Zealand negotiators weren’t in “capitulation mode”. . . 

No drought-breaker but ‘darn good help‘:

A farmer in the heart of the North Canterbury drought is welcoming the rain currently falling in parts of the region, describing it as a good morale boost for many farmers.

Vince Daly runs a 160 hectare cropping farm in Cheviot. He said the NIWA weather station on his farm showed the soil moisture level on his farm has gone from 32 percent to 37 percent this week so far. Normally it is at 100 percent at this time of year.

Mr Daly said 43 millimetres of rain had fallen but farmers further inland have, so far, not been so lucky. . . 

Aorere Wins NZ RiverPrize:

NZ Landcare Trust’s Aorere River Project won the inaugural Morgan Foundation NZ Riverprize at the International Riversymposium Gala Dinner in Brisbane last night.

Richard Thompson Chair of NZ Landcare Trust’s Board of Trustees said “What a fantastic result for the Trust and the Aorere community. This is an amazing result given the strength of the competition… it really underlines the value of this project and the work carried out by NZ Landcare Trust.”

NZ Landcare Trust CEO Dr Nick Edgar accepted the award on behalf of the Aorere River Initiative. “I think this is a real victory for community-led grassroots river management in New Zealand. Without the Aorere river community, the story really wouldn’t have happened.” . . 

Rural areas feeling agricultural sector slowdown:

Almost a third of businesses in regions see revenues fall

Three quarters of agricultural businesses expect economy to decline

Businesses in New Zealand’s rural areas are already feeling the effects of a significant slowdown for the agricultural sector, according the latest MYOB Business Monitor survey of over 1000 businesses nationwide, which includes over 200 rural SMEs.

Over the last 12 months, just 18 per cent of rurally-based SME operators have seen their revenue rise, compared to the SME average of 31 per cent. Almost a third (32 per cent) have seen revenue decline in the year to August 2015 (25 per cent SME average). . . 

Fonterra director Farrelly replaces Norris on Fund board – Paul McBeth:

(BusinessDesk) – Fonterra Cooperative Group director Ian Farrelly will replace Ralph Norris as one of the dairy exporter’s representatives on the board of the Fonterra Shareholders’ Fund manager.

Farrelly will join the board of the fund’s manager at the close of its annual meeting on Nov.27 when Norris retires, Fonterra said in a statement. Farrelly has been on the board of Fonterra since 2007, having clocked up a 20-year career in banking including 15 years as head of ASB Bank’s rural division. He operates a 400-hectare calf rearing farm in Te Awamutu and has dairy farm interests in Canterbury and Waikato. . .

Lasers: the transformation to come –  Lynley Hargreaves:

Cather Simpson wants every child and parent in New Zealand to know the word photonics – and to consider photonics science or engineering as a career. An Associate Professor at the University of Auckland and Director of the Photon Factory, she’s worked on problems as diverse as robotic surgery and sorting dairy herd sperm by sex. Now as part of the International Year of Light and Light-based Technologies, Associate Professor Simpson is working to give school children, and the general public, a glimpse of the future of laser manufacturing.  . . 

Official start of new PGP lamb programme:

Primary Industries Minister Nathan Guy has welcomed the official start of a new Primary Growth Partnership (PGP) programme involving premium quality lamb products.

“The ‘Targeting New Wealth with High Health’ PGP programme aims to reach existing and emerging markets with a new class of premium lamb products with improved health qualities,” says Mr Guy.

“This is a collaboration between Alliance Group, Headwaters New Zealand and the Ministry for Primary Industries (MPI). It will help our producers tap further into the increasing demand for premium and healthy foods, and add value to our exports. . . 

Rabobank Agribusiness Monthly (NZ) – September 2015:

Rabobank’s Agribusiness Monthly provides timely information and analysis on agricultural conditions, commodity price updates and commentary on the latest sectoral trends and developments.

Key highlights
Agribusiness Monthly

Dairy – Global commodity prices have shown signs of recovery in recent weeks, as international buyers look for short-term cover, given that prices appear to have reached a floor.

Beef – Steady demand from the US continues to fuel farmgate prices, with record levels reached this September (NZD 6.10/kg cwt). Prices have edged up 33% from last year, supported by seasonal tightening of supplies.

Sheepmeat – Farmgate prices have continued to improve into September 2015, with supply tightening heading into lambing season. . . 


Rural round-up

September 14, 2015

Federated Farmers welcome court ruling on genetic modified crop:

A Western Australian Court of Appeal ruling on genetically modified (GM) crop liability has been welcomed by Federated Farmers as a landmark decision which clearly sets out fundamental responsibilities of good neighbours that apply equally well in New Zealand and around the farming world.

In 2014, organic farmer Steve Marsh sued his neighbour, GM farmer Michael Baxter, for damages after sheaves of GM canola blew onto his property, resulting in his partial decertification as an organic farmer. Mr Marsh also sought a permanent injunction preventing his neighbour from growing GM crops.

At the time the case went to court, anti-GM groups, confident of a win, hailed it as potentially precedent setting. . . 

25 pieces of advice for 25 year-old farmers – Matthew Naylor:

I have been a farmer in my own right for a quarter of a century.

I know that I look unfeasibly young to make such a claim; I started work at 15 and pretty well managed to avoid higher education.

Twenty-five more years of toil and I will be looking at the age of retirement from the other side.

To commemorate this halfway milestone, I have compiled the little that I have learned over my 25 years of experience into 25 pieces of advice for 25-year-old farmers.

  1. Set a clear and simple business plan and stick to it. Tell it to anyone who will listen – your family, colleagues, customers, competitors and even the postman.
  1. Kill weeds when they are small – this rule applies to any problem you encounter in life. . . 

Street doctor tells rural people to watch their health – Jill Galloway:

A doctor who specialises in treating people in rural regions says farmers need to get their own health checked more often.

Dr Tom Mulholland talked to about 50 people at the old Parewanui school near Flock House, Bulls this week.

“Farmers are good at looking after their stock and their land, but not so good at looking after themselves and their top paddock [their heads].”

About half the group listening to him talk were men. . . 

NZ stands firm on lamb export deal:

New Zealand will not agree to a review of New Zealand’s quota of lamb exports to Europe despite pressure from British farmers, the government says.

Livestock board chairs from Britain’s farming unions, meeting in Brussels, have called for the review. They say New Zealand has moved from sending frozen lamb to chilled lamb and from carcasses to bone-in cuts, representing a substantive change to the original deal signed in the 1980s.

But Trade Minister Tim Groser points to later trade negotiations which changed that agreement. . .

Avocado congress should ‘raise industry profile‘:

The World Avocado Congress get underway in Peru today.

The congress is held every four years and New Zealand Avocado chief executive Jen Scoular, who is in Peru, said it was a great opportunity to raise the profile of the industry.

Ms Scoular said the congress, which runs for a week, allows countries to share science and research information. She said tree productivity and irregular bearing of avocados would be a hot topic because it was a global issue. . . 

Whitebait, birds receive conservation boost:

Whitebait will be making a comeback into Christchurch and more will be done to protect the habitats of Canterbury’s colony-nesting river birds, says Associate Conservation Minister Nicky Wagner.

The Community Conservation Partnership Fund is providing more than $126,000 to the Whaka Inaka project to restore whitebait habitat in Christchurch, and more than $33,000 to the Braided River Partnership project to improve the success of colony-nesting birds along Canterbury rivers.

“Whitebait spawning in Christchurch has declined, particularly after the earthquakes caused significant habitat damage. The Whaka Inaka project will provide an immediate temporary spawning habitat for whitebait along 3km of Christchurch river banks,” Ms Wagner says. . . 

A falling dollar not all bad news – Rick Powdrell:

I was just thinking lately how things can change so abruptly in a year.

Farmers are once again facing tough realities of global export trade, price volatility and geopolitical unrest.

This time, last year, dairy was buoyant with record payout and nothing looking at halting the juggernaut.  Sheep meat prices were positive for the season; beef was in the ascendancy and wool finally rebounding.

Fast forward and dairy is struggling with sheep meat failing to deliver on anticipated returns. Still, beef is extremely strong and wool has continued its gradual recovery. . .


Rural round-up

September 10, 2015

Number of TB infected herd numbers at all-time record low:

The number of bovine tuberculosis (TB) infected herds has dropped below 40 for the first time in the history of New Zealand’s TBfree programme delivered by OSPRI. According to this week’s figures, an all-time low of 36 herds were infected with bovine TB (34 cattle and two deer herds).

OSPRI Chief Executive, Michelle Edge, said ‘Reaching this milestone is a credit to farmers and the industry and Government organisations that are shareholders and investors in the TBfree programme and is a big step towards New Zealand becoming TB-free.’

Farmers, industry and Government partners working hand-in-hand with OSPRI have collaboratively made the programme one of the world’s leading TB control schemes. . . 

New Zealand’s Precision Seafood Harvesting Finalist In Global Seafood Champion Awards:

The new Precision Seafood Harvesting fishing technology being developed in New Zealand has today been announced as a finalist in Seaweb’s Seafood Champion Awards at Seafood Expo Asia in Hong Kong.

The Seafood Champion Awards annually recognise individuals and companies for outstanding leadership in promoting environmentally responsible seafood. PSH is a finalist in the Innovation category, which recognises efforts in advancing sustainability within the global seafood sector to effectively design products and processes with sustainability as a driving force. . . 

New Zealand Ambassador to Chair WTO Agriculture Negotiations

Trade Minister Tim Groser announced today that the members of the World Trade Organisation have appointed New Zealand’s WTO Ambassador, Vangelis Vitalis, as the new Chair of the WTO Doha Round agriculture negotiations.

Mr Vitalis was formally elected Chair at a meeting of the Special Session of the Committee on Agriculture held in Geneva today.

“I am very pleased that the WTO membership have once again underlined their trust and confidence in New Zealand’s WTO Ambassador for the role as Chair of the agriculture negotiations”, Mr Groser said. . . 

 

Fonterra Milk Volume Forecast:

Fonterra Co-operative Group Limited has maintained its milk volume forecast for the 2015-16 season at 1,589 million kgMS, which is in the range of 2-3 per cent lower than the amount collected last season.

Fonterra is required under the Dairy Industry Restructuring Act to update its current season forecast milk volumes by early September.

Group Director Co-operative Affairs Miles Hurrell said although Fonterra had forecast a 2-3 per cent decline in volumes there was evidence that farmers were pulling back on production, which could lead to a further downward revision of forecast volumes as we move through the season.

“Farmers are responding to the lower forecast Farmgate Milk Price by returning to more traditional farming practices. They are reducing the use of feed supplements, and lowering stocking rates per hectare as they concentrate on utilising pasture. . . 

 

Too many eggs in the whole milk powder (WMP) basket – Keith Woodford:

For some time there has been a view developing within New Zealand that we have too many eggs in the dairy basket. There is also a view that we are over-exposed to China.

I do not share those perspectives, at least when they are expressed in such over-arching and simplistic terms. In contrast, I note that dairy is one of the things we are good at, and that our pastoral dairy resources are not easily put to alternative profitable use.

Yes, we could go back to sheep production, but I do not know where we would profitably sell the increased meat volumes. For beef, there are markets, but most of our beef is a by-product of dairy. It is hard to make money from beef cows. . . 

Fonterra Opens New Manufacturing Facility In Indonesia:

Fonterra Co-operative Group Limited has officially opened its new blending and packing plant in Indonesia – its first manufacturing facility in the country.

Chairman John Wilson said the plant is Fonterra’s largest investment in ASEAN in the last decade and will support the growth of Fonterra’s brands – Anmum, Anlene and Anchor Boneeto – in Indonesia.

“Fonterra has been supplying high quality dairy nutrition to Indonesia for more than 30 years and today it is one of our most important global markets. The opening of our new plant is an exciting step forward in our relationship with the country and local dairy industry,” he said. . . 

Dairy Women’s Network conference details announced:

Dairy Women’s Network has decided to take its cue from the dairy industry and curtail its next annual conference, at a time that the industry and its members are hurting.

The Network had planned to hold the 2016 conference in Wellington over two full days in May.

“The Wellington location would have meant more people from the North Island needed to fly than if we held it in a central North Island location,” said de Villiers. . .

MPI and cruise industry to combat fruit fly risk:

The Ministry for Primary Industries (MPI) will work closely with the cruise ship industry this season to manage biosecurity risk, especially fruit fly.

The cruise sector is expecting a record season, with passenger numbers forecast to jump 33% to 267,800.

“This, coupled with the enhanced fruit fly threat across the Tasman and other parts of the Pacific, has brought MPI and the cruise industry together to improve biosecurity,” says Stephanie Rowe, MPI’s Head of Intelligence and Operations. . . 


Rural round-up

September 5, 2015

Rumours of Silver Fern Farms China deal – Sally Rae:

Farmers have been urged not to be ”seduced” by short-term gains as rumours swirl that an announcement by Silver Fern Farms of a 50-50 joint venture with a Chinese company is imminent.

Heriot farmer Allan Richardson, who has led a group of shareholders seeking a meeting to discuss a possible merger with Alliance Group, believed foreign ownership of the co-operative was ”just around the corner”.

Mr Richardson expected Silver Fern Farms could make an announcement to farmers within the next week. . .

Stick to your guns Mr Groser – Andrew Hoggard:

When examining the current low dairy payout there are a number of factors that come into play.

One overriding issue is the protected nature of dairy trade throughout the world. For some strange reason, dairy seems to be one of the most protected food commodities.

This high level of protection means there is only a small global market for dairy products that are freely traded and so, if we get even the slightest market shock, you get quite a big price fluctuation whether it’s up or down.

For me, this emphasises how critically important breaking down trade barriers are for New Zealand’s prosperity not only on farm, but for all those regional economies that rely so heavily on agriculture. . . 

Farmers fear return to ‘desert’ conditions:

A farmer in the heart of the North Canterbury drought says a prolonged dry spell brought on by El Niño will put already struggling farmers in dire straits.

Vince Daily, who runs a 160 hectare cropping farm in Cheviot, said the NIWA weather station on his farm showed the soil moisture level was at 30 percent, rather than the normal 100 percent it is at at this time of year.

Mr Daily said any drought caused by El Niño would just be a continuation of the current conditions.

“We could lose 2 or 3 percent moisture a day and in 20 days you could be back to looking like a desert again,” he said. . .

Building a talent pipeline with New Zealand Young Farmers:

Being part of a TeenAg club at high school kept Northland teenager Sam Moscrip in school longer than he had intended, and it has opened him up to many new possibilities in the primary industries.

The TeenAg club format has been developed by New Zealand Young Farmers as a way for younger people to get started with the movement.

Young Farmers are taking a “pipeline” approach, explains NZYF chief executive Terry Copeland, developing a format to suit each age group around the Young Farmers set-up. New Zealand Young Farmers has existed for more than 80 years and is for people aged 16 to 31. . .

Decision time for dairy support farmers – Rick Powdrell:

As the New Zealand dairy industry has expanded rapidly in recent years so too has the dairy support farm.

So what is the dairy downturn going to mean for the dairy support farmer?

This is an important question which needs some serious thought by both sides of the industry.

Already we have seen many dairy animals not go out to the previously arranged winter feed.

Thankfully for those farmers who had grown this feed, the Mainland drought and North Island floods meant there was an alternative option to sell it. . . 

Calf rearing popular again – Tim Fulton:

Rearing calves on weight gain has leapt back into fashion on dairy units around the country.

A beef-cross calf reared to 100kg may have netted a dairy farmer $400-$500 this season, PGG Wrightson general manager of livestock Peter Moore said.

“If you look over the country there’s been a lot more calves reared than in the past,” he said.Farmers were rearing good Friesian bull calves or the male offspring of Angus or Hereford cows mated late in previous seasons. . .

Wool world record: 40kg fleece shorn off overgrown sheep RSPCA says:

Wool shorn off an overgrown sheep found near Canberra on Wednesday has set an “unofficial” world record for the heaviest fleece removed in one shearing, the RSPCA says.

The sheep, dubbed Chris, underwent a risky shearing operation to remove 40.45 kilograms of wool.

It smashed the previous world record held by a sheep in New Zealand called Shrek, whose fleece weighed 27 kilograms. . .

NZ wool trades at record high amid tight supply – Tina Morrison:

(BusinessDesk) – New Zealand wool is trading at record high prices, pushed up by strong demand and limited supply, though the outlook is murky.

The price for clean 29-micron wool changed hands at a record $10.45 a kilogram at yesterday’s North Island auction, up from $9.95/kg at the previous North Island auction on Aug. 13, according to AgriHQ. Meanwhile, the price for 27-micron wool jumped to $10.90/kg, up from $10.70/kg at the previous North Island auction and at its highest level since October 2002, AgriHQ said. . . 

Solutions sought for saving summer fruit:

Combating pests and diseases of tree-based crops and summer fruits was the target of the latest MG Marketing ‘Growing You’ workshop held recently at Lincoln.

MG Marketing, a co-operative organization that has over 90 year of successful record of growing, distributing and selling a comprehensive range of fresh vegetables and fruit, in collaboration with Lincoln University, the Biological Husbandry Unit (BHU) and the Bio-protection Research Centre (BPRC) developed workshops for growers and commercial operators from all around New Zealand to advance their scientific knowledge and practical skills.

About 20 of MG Marketing’s top growers from diverse operations such as cherries, feijoa, raspberry, citrus, and tree-based fruits, from across New Zealand travelled to Lincoln for the workshop. . . 


Quote of the day

August 25, 2015

“What we’re trying to do is create options for New Zealand over the next 20 years so we never recreate the same dependency that we used to have 40 years ago, which was [on] Britain,” he said. “Southeast Asia, for us, is frankly our number one insurance policy if things go the wrong way in China.” –  Tim Groser


Rural round-up

August 2, 2015

Groser disappointed TPP deal not reached:

Trade Minister Tim Groser is disappointed that the TPP negotiations were unable to reach a conclusion today, but TPP ministers collectively pledged to meet again as soon as possible to finalise the deal.

“Good progress was made this week, but a number of challenging issues remain, including intellectual property and market access for dairy products”, Mr Groser said.

“We will continue to work toward a successful conclusion. This is about getting the best possible deal for New Zealand, not a deal at any cost.” . . .

TPP pressure on Canada, but US is super-star in agriculture subsidies – Lawrence Herman:

Americans provide billions in protectionism to dairy that will have to be given up for trade deal.

We rail against Canada’s supply management system. Rightly so. It’s a Soviet-style regime that is out of step with Canada’s international trade interests and objectives. Every credible Canadian think-tank has said that supply management is a regressive system that distorts the market by guaranteeing dairy, poultry and egg producers a positive return on production, inhibiting competitiveness and, in the long-run, preventing Canada from becoming an exporting agriculture powerhouse. . .

 Groser proves trade credentials by insisting on a good deal:

The Dairy Companies Association of New Zealand (DCANZ) is commending New Zealand Trade Minister, Tim Groser, for standing firm against enormous pressure to concede to a sub-standard deal for dairy. The Minister and his team of expert negotiators have preserved the ability to conclude a good deal in the future.

“What was on the table fell well short of the deal required to deliver the commercially meaningful access that is needed by New Zealand’s dairy industry” says DCANZ Chairman Malcolm Bailey, who has been in Maui, Hawaii, where the negotiations took place over the past week.

Agreeing a bad deal would have consigned New Zealand farmers to many more years under the burden of heavy protectionism. Trade prohibitive tariff levels in Japan, Canada and the United States contribute to a thin global dairy market and exacerbate extreme price volatility. . .

 Concerns over strong El Niño:

NIWA fears this year’s El Nino may be as bad as 18 years ago, when widespread drought cost the country a billion dollars in lost exports.

International guidelines indicated a 97 percent chance of El Niño continuing over the next three months and a 90 per cent chance it will continue over summer.

El Niño typically sees the west of New Zealand wet, and the east very dry.

Niwa forecaster Chris Brandolino said it was looking like it could be as significant as the El Nino in the nineties. . .

Where every day is a good day – Kate Taylor:

Discussion groups, monitor farm programmes, running a Gisborne hill country station and his house burning down couldn’t prepare farmer Ken Shaw for being given a 15 per cent chance of surviving the cancer attacking his body. But survive he did.

“Every day’s a good day,” he says, driving his bike in driving, freezing cold rain on his Matawai farm the day before a big snow storm hits the region and dumps a metre of snow on tops of his hills.

Ken and Kirsty Shaw farm the 709ha hectare Elmore Station (680ha effective) on Rakauroa Road at Matawai near the highest point of the highway between Gisborne and Opotiki. . .

Cut unprofitable production – DairyNZ CEO:

With the continued decline in milk price, DairyNZ chief executive Tim Mackle is calling on farmers to cut unprofitable production from their systems.

“These are extraordinary times. Open Country Dairy’s milk price forecast is under $4 per kilogram of milksolids (kg MS) and all indicators show Fonterra will be forced to lower their forecast on August 7. This price dip is lower and longer than anything we’ve seen in the last decade,” says Tim.

“Assuming a milk price of $4.00 for the average Open Country Dairy supplier, that means a potential deficit of around $250,000 for the year ahead.” . . .

Rural Women as relevant today:

In 90 years, Rural Women New Zealand has grown to a 2700-strong organisation but many of the issues it works on have remained the same.

In July 1925, Florence Polson became the first head of the women’s division of the forerunner of Federated Farmers.

Women’s Division Farmers Union was driven by concerns about health and the effects of isolation for women living on farms. . .

 


More ambitious climate change targets

July 8, 2015

New Zealand will commit to a new, more ambitious climate change target, Climate Change Issues Minister Tim Groser announced:

“This target is to reduce our greenhouse gas emissions to 30 per cent below 2005 levels by 2030,” Mr Groser said. “This is a significant increase on our current target of five per cent below 1990 emission levels by 2020.”

New Zealand will submit the target to the United Nations Framework Convention on Climate Change. All countries are expected to table targets as part of work towards a new climate change agreement, due to be concluded in Paris in December.

“While New Zealand’s emissions are small on a global scale, we are keen to make a fair and ambitious contribution to the international effort to reduce greenhouse gas emissions and avoid the most harmful effects of climate change,” Mr Groser said.

“Almost 80% of our electricity is renewable already, and around half our emissions come from producing food for which there aren’t yet cost-effective technologies to reduce emissions. So there are fewer opportunities for New Zealand to reduce its emissions right now.

Those who think New Zealand isn’t doing enough forget that we’re already doing quite a bit.

Some of that is because there aren’t many of us and we don’t have a lot of heavy industry but do have a natural advantage in generating renewable energy

It’s also important t take a global perspective and acknowledge that although farming contributes a high percentage of our emissions, most of what we produce goes to other countries few if any convert grass to protein as efficiently as we do.

“However, I’m optimistic about the future – our investment in agricultural research is beginning to bear fruit and the cost of electric and plug-in hybrid vehicles continues to fall. I think in 5-10 years we’ll be in a good position to reduce our emissions in both agriculture and transport.

“In setting the new target, the Government needed to ensure it was achievable and to avoid imposing unfair costs on any particular sector or group of people. . .

“New Zealand’s target is equivalent to a reduction of 11 per cent below our 1990 emission levels by 2030. Our target is expressed against 2005 emission levels similar to the approach of other significant players including the United States and Canada,” Mr Groser said.

“The target will remain provisional until we ratify the new international agreement. The detailed rules and guidelines for national reduction targets are likely to be set after the Paris meeting. These will cover matters such as the rules on accounting for the land sector, and ensuring international carbon markets meet high standards of environmental integrity.”

“The Government will adopt an appropriate mix of policies to ensure the target is met. In particular, we will begin a review of the Emissions Trading Scheme this year, which will include scope for further public discussion on what New Zealand will do domestically.” Mr Groser said.

Federated Farmers says the new target is an ambitious one:

Federated Farmers Climate Change Spokesperson Anders Crofoot says in line with the Intergovernmental Panel on Climate Change report which says reducing fossil fuel use will need to be the major focus to achieve this target. However agriculture will also play its part in development of technologies which will increase productivity whilst reducing carbon intensity of primary sector products.

“Agriculture takes its responsibilities as New Zealand and global citizens seriously and the primary sector already has an impressive track record in achieving carbon efficiency.”

“We continue to play an on-going role in meeting the world’s demand for nutrient-dense protein and finding solutions which addresses both climate change concerns and the food security dynamic.”

“To date, the amount of carbon released in producing a block of butter here in New Zealand is the lowest in the world. It is important to make sure our approach to reducing New Zealand’s emissions does not undermine our critical export industries.”

“In a resource-constrained world, it is vital to use resources efficiently and wisely. Climate change does not begin or end at New Zealand’s borders and New Zealand plays a vital world leading role as one of the most emission efficient food producers and exporters in the world.”

Beggering agriculture here would cause great harm to our economy and it would also increase emissions as less efficient producers in other countries increased production to fill the gap left by us producing less.

Anders Crofoot says New Zealand’s primary sector has made huge gains in carbon efficiency in the past three decades, through enhanced animal and plant genetics, as well as through a much greater understanding of livestock digestion and metabolism. He says our agricultural emissions intensity has declined more than 20 percent since 1990.

“Reducing emissions from biological systems such as dairy cows is not easy. That’s why since 2003, New Zealand’s agricultural sector has invested $30 million to help find solutions. AgResearch scientists have already identified five different animal-safe compounds that can reduce methane emissions from sheep and cattle by 30 to 90 percent. Further trials are needed to confirm that these compounds can reduce emissions in the long term, have no adverse effects on productivity and leave no residues in meat or milk. But all going well, we could possibly see a commercial product for use on-farm within five to ten years.”

“Continued investment will be required to develop science to reduce and treat biological agricultural emissions. This is how we can make a considerable contribution to reducing global greenhouse gas emissions by getting larger developing country emitters to adopt our technologies.”

“New Zealand is already sharing its developments and gains through the Ministry for Primary Industries and Federated Farmers Global Research Alliance World Farmers Organisation Farmer Study Tours. The aim is to increase global understanding on agricultural greenhouse gas research and engage farmers on environmental management practices that support sustainable productivity.”

Mr Crofoot concluded “The task before us now is to work on solutions built off an understanding of the strengths we have as an agricultural producer, and how best we can grow those strengths in a manner that improves emissions efficiency and farm productivity.”

Business New Zealand says the target is challenging but achievable :

. . .”Our unique profile, with unusual predominance of agricultural and transport emissions, means we must be deliberate about how we achieve reductions without harming the economy.

“Key to this will be a balanced outcome for all countries taking part in forthcoming negotiations in Paris, facilitating investment, technology development and access to markets in a way that provides New Zealand businesses with the confidence to invest in low-carbon solutions for emission reductions over the long term.”

Balance is indeed the key – balance between all countries and between environmental and economic concerns keeping in mind it is the most vulnerable people who would  pay most dearly if that balance isn’t achieved.


Trade works

July 1, 2015

Trade Minister Tim Groser’s speech on the future of global trade highlights the benefits of trade:

·         First, consider the evidence for developed countries. Of the 14 main OECD multi-country econometric studies undertaken since 2000, all 14 have concluded that trade plays an independent and positive role in raising incomes.

·         Second, the evidence for developing countries leads to exactly the same conclusion. Case studies reviewing the experience of the 12 most rapidly growing emerging economies over the past 60 years concluded that harnessing the power of the global economy was a central feature common to all and that there was what they called ‘overwhelming’ evidence that trade played an essential role in raising incomes. Sorry guys, the North Koreans got it wrong. The South Koreans got it right.

The final concluding comment of these international experts is dripping with irony. Normally, international officials don’t do irony; it takes extreme frustration to drive experts to use ironic humour. Listen to their words:

“Despite all the debate about whether openness [on trade] contributes to growth, if the issue were truly one warranting nothing but agnosticism, we should expect at least some of the estimates to be negative…The uniformly positive estimates suggest that the relevant terms of the debate by now should be about the size of the positive influence of openness on growth….rather than about whether increased levels of trade relative to GDP have a positive effect on productivity and growth”. . .

I can of course understand vested interests who oppose trade agreements. If, say, your family owns an inefficient sugar processing plant in the wrong part of the United States and which survives only because of sugar subsidies and high protection, I get it. What you need is a long time to adjust to competition, sweetened by a good dose of adjustment assistance. You may even surprise yourself by what you can do to improve your competitive position over a long period of time – I could take you to dozens of examples in this country of industries and companies which vigorously contest our first liberalisation moves in the1980s, staring with the NZ wine industry which used to be deeply protectionist and for understandable reasons. But I am zeroing-in here on the anti-trade, anti-globalisation ideologues who are present around the globe. Even in Germany, a post-war bastion of the open trading system, they have become quite recently a growing element of the political debate on trade. This will complicate the TTIP negotiation.

Here in New Zealand we have anti-trade activists who are relentlessly consistent: they have never supported a single Trade Agreement and they never will. They are politically irrelevant to my political party. However, they get an enormous amount of airplay and are not politically irrelevant to other important elements in our democracy. For reasons I explained earlier, I believe broad bipartisan support for open trade strategies is vital to avoid your country being marginalised.

There is no point in asking them to explain how on earth New Zealand could have survived, let alone prospered, without CER, without the Uruguay Round, the China FTA, the network of FTAs that New Zealand has with ASEAN countries – they opposed even the Singapore/NZ FTA, the first building block of the DNA of TPP. To paraphrase a well-known quote of our Prime Minister, are we meant to earn our living just be selling to ourselves?

There is no point in asking them to explain this, because this is not an evidence-based fight. This is about ideology and the role of markets. On a purely personal note, and going back to my political past in the late 1960s and on which I will not elaborate, I understand exactly how and why these people think like this. I recall wistfully an old political doctrinal statement ‘The final battle will be between the socialists and the ex-socialists’.

If it were just these anti-trade activists, they could be safely ignored by everyone. But their modus operandi is to give currency to concerns about policies that middle New Zealand, which is anything but ideological, cares about – and then to exaggerate those concerns out of the park.

Happily, those concerns of middle New Zealand are widely shared starting with me, my colleagues in Cabinet and Caucus and the Kiwi voters who elected us. And as I survey the likely landing zone for these issues, I am extremely confident that our negotiators, who are world class, have done an excellent job. We shall be able to defend our position.

He counters some of the scaremongering from opponents of the TPP:

So, to put it bluntly, we are not going to sign up to poorly constructed ISDS provisions that ‘transfer control of the country’s sovereignty’ to foreign corporations. We are not going to sign up to agreements that undermine a central pillar of our Public Health system – the pharmaceutical purchasing agency called Pharmac, which is used to keep the cost of medicines very affordable for middle New Zealand. We are not going to sign up to agreements that stop this or future Governments putting well-designed environmental protections in place. We are not going to sign up to provisions on ISPs that make every mother in Lower Hutt worry that the TPP electronic police are going to fly in from Houston to cart their 16 year old son off to jail for file-sharing with his girlfriend.

If and when we get TPP in place, extreme claims that the sky is going to fall in will be made, irrespective of a balanced and sober reading of the final agreed TPP texts. It will be ground hog day for Chicken Licken. I recall, for example, at the end of the Uruguay Round where I was our chief negotiator, absurd claims that the Uruguay Round TRIPs agreement would ‘destroy the Maori economy’, in spite of the fact that the vast bulk of Maori assets, today valued at $40 billion, are in the export sector with much to gain from the Uruguay Round.

That exciting new dairy export company near Taupo called Miraka, the Maori name for milk, that combines significant Maori business assets, locally available renewable geothermal energy and overseas capital invested in it, simply would not exist without the Uruguay Round export subsidy disciplines that allowed our dairy industry to grow against grossly unfair competition, along with the more recent FTAs that created markets and created the interest of Asian investors in investing in New Zealand’s future alongside our own people. . .

He is aiming to get the political deal done by the end of this month:

The deal is ripe for the picking politically, which does not mean it will be easy to reach up and pick nice ripe fruit without damage. I have been deeply involved in the endgame of some pretty significant international negotiations over the last few decades and sometimes it isn’t very pretty. If I told true stories of what I have seen – right up to and including fist fights and negotiators sobbing over the phone, I really don’t think people would believe me.

So please remember this: nothing is ‘too big to fail’. Nor can I be 100% sure that all twelve countries will arrive on the right page at the same time. The one thing I can say with near certainty is that in the course of the endgame, something will come out of left field that we knew about but which no-one had seen before as a deal-breaker.  . .

But I think we will get there – metaphorically, I have called it in some interviews a 7/10 probability. It is not going to be a perfect deal – there never will be a perfect deal because compromises are now required. From a New Zealand point of view, the assessment my team of negotiators, led by Dr David Walker, and I have made and conveyed to other Ministers including the Prime Minister is that there is potentially a landing zone for a good deal that will indeed shape the future of trade and investment integration in the Asia Pacific region and quite decisively.

I would be much more positive in public than this, but for the current lack of clarity on a possible landing zone for our most important export – dairy. It is not that there is nothing on the table on dairy. Nor, let me assure the deep pessimists, do I believe there is any possibility of dairy simply being ‘excluded’ simply because it is too sensitive. That of course would take New Zealand right out of TPP. The issue for us is the quality of the deal on dairy and it is nowhere near there yet.

That will change because it has to change. People have not been putting their real cards on the table until they knew they had to. And until we heard from the US Congress, they were never going to do that. It is going to be an interesting few weeks.

Ladies and gentlemen, if the negotiators representing the 12 countries involved in TPP – almost 40% of global GDP – can pull this together, it will indeed be a big deal. Andrew Robb, my Australian counterpart, calls this ‘the biggest trade deal since the Uruguay Round’. I think he is right. And if we can do it, the TPP bus will not stop finally at the Tokyo station – Japan being among the last TPP entrants. TPP will indeed shape the future integration of the region and possibly strategic thinking elsewhere.

The future for New Zealand is not to shut up shop, to be fearful of foreigners, foreign investment, even targeted migration and suspicious of all Trade Agreements – my word, it must be so depressing to be part of the anti-trade movement. We need to engage with the world. We should back ourselves. We have every reason to be optimistic about our place in the world in the first quarter of the 21st Century. Concluding a high quality TPP Agreement is part of that future.

I am old enough to remember the past when New Zealand businesses were highly subsidised, when the power and money was in the hands of the few who had import licences, when we all paid dearly through higher prices and higher taxes for inferior local goods than higher quality and lower priced alternatives from overseas.

Those who oppose free trade would have us go back to that.

Free trade is fair trade which benefits the buyer and the seller.

As a very small country needing to sell what we produce to people in other countries in order to afford what we can’t produce ourselves, we need free trade and the TPP is an important part of freer trade.

 


Rural round-up

June 23, 2015

Water presents high risk to agribusiness:

Whether it’s growing crops, generating electricity or entertaining tourists, water is a key ingredient for the success of the New Zealand economy, yet this also makes it a key risk.

PwC’s latest publication, Preserving water through collaboration that works, considers how New Zealand within a global context, has responded to water risks and the potential to improve water management in the future. New Zealand faces its own risks which differ from those in other parts of the world, and these risks, are increasing.

PwC Director and Local Government expert David Walker says, “A usable supply of water is fundamental to the New Zealand economy and permeates across all industries – and notably farming, forestry, electricity generation and public sectors. However continued effective water management is becoming more complex and costly. . .

ASB Farmshed Economics Report Cash is king for farmers

• Despite a better milk price forecast, farm cashflows will remain weak this season.

• But falling interest rates are putting cash back in farmers’ pockets.

• Meanwhile, the hot air has been let out of the NZ dollar.

Despite Fonterra’s better opening season milk price forecast, farm cashflows will still face pressure this season, according to the latest ASB Farmshed Economics Report. . .

 

TPP dairy deal ‘not at a level we would currently like’, says Key – Pattrick Smellie:

(BusinessDesk) – The Trans-Pacific Partnership trade pact does not yet include an acceptable deal on access for New Zealand’s most important exports, dairy products, with little more than a month to go before the controversial 12 nation trade deal could be concluded.

“I think the way I would describe it is there’s a deal. It’s probably not at the level that we would currently like,” said Prime Minister John Key at his post-Cabinet press conference in Wellington. He was referring to comments last week by Trade Minister Tim Groser that negotiations on dairy access to the heavily protected US, Canadian and Japanese markets had “barely started.” . . .

A2 shareholder Freedom Foods in consortium to take over milk marketer – Fiona Rotherham:

(BusinessDesk) – A2 Milk Co’s cornerstone shareholder, Freedom Foods Group, is part of a consortium with an international dairy group that’s eyeing a takeover of the dual-listed milk marketer.

Freedom Foods, which owns about 19 percent of A2 Milk with a related entity, is mulling a takeover of A2 Milk, making an indicative non-binding and conditional expression of interest to buy the shares it doesn’t already own. A deal would be contingent on the consortium, which includes an “unnamed leading international liquid dairy milk company”, undertaking due diligence. It also has a restriction on A2 Milk changing the number of shares on issue, effectively scotching a planned equity raising. . .

LIC seeks $125M debt facilities this year, targets $140M equity over decade – Jonathan Underhill:

Livestock Improvement Corp, which aims to lift annual revenue to $1 billion by 2025, says it plans to establish $125 million of debt facilities this year and is likely to require $140 million in equity capital over the next 10 years to meet its growth goals.

Details of its capital requirements are included in a presentation the bull semen and dairy genetics database manager is taking around the country to explain to its shareholders how its changing focus, with increased capital spending and new product development, is changing its financial profile. Previously it has only required seasonal debt funding, typically for three months, the presentation shows. .

Upper South Island Butchers Battle It Out:

The best young butchers in the Upper South Island have been announced following the Alto Young Butcher and Competenz Butcher Apprentice of the Year regional final on Saturday.

Rowan Lee from Peter Timbs in Bishopdale was the winner of the Alto Young Butcher category, while Matthew Clemens from New World Ilam topped the Competenz Butcher Apprentice category, both highly sought after titles. . .

 

Tractor and Machinery Association elects new President:

Mark Hamilton-Manns, New Zealand Sales Manager for John Deere, has been elected President of the Tractor and Machinery Association (TAMA).

Formerly Vice President of the organisation, he takes over from Ian Massicks, New Zealand Kubota Manager for CB Norwood Distributors, who had been President for six years.

Roger Nehoff, General Manager New Zealand Retail for Landpower New Zealand, was elected Vice-President. . .


Rural round-up

May 9, 2015

Low-Cost Pasture-Based Dairying Still Our Best Bet, Say Farm Environment Leaders:

New Zealand dairy farmers shouldn’t lose sight of their competitive advantage, say farm environment ambassadors Mark and Devon Slee, who recently returned from a study tour of the Northern Hemisphere.

In late March the Canterbury dairy farmers and National Winners of the 2014 Ballance Farm Environment Awards embarked on a 25-day trip to the United Kingdom, Netherlands and Ireland, visiting a wide range of dairy farms

Mark says a key aim of the tour, which was facilitated by the New Zealand Farm Environment Trust and supported by a range of industry groups, was to study intensive dairy farming systems in Europe and to find out how farmers were using technology to improve sustainability. . .

Pacing global changes a big ask for Fonterra – Fran O’Sullivan:

Tim Groser’s warning that the dairy sector would effectively have to guts it out during a period of low milk payouts was timely.

It’s perhaps easier said than done maybe from the perspective of a Trade Minister.

But dairy farmers are a resilient lot. They’ve been through cyclical times before.

Yet, last week’s Fonterra announcement that the co-operative has downwardly revised its 2014/2015 payout forecast back to $4.50/kg milk solids (from $4.70) was still a hard knock for those that had factored the higher track into their own financial planning.

Federated Farmers pointed out just how difficult it was for some dairy farmers with their comment that the average Canterbury dairy farmer was now facing a loss of 91c for every kilogram of milk solids that they produced. . .

ANZ Bank was most aggressive in rural rate swaps sales to farmers, ComCom says – Paul McBeth:

(BusinessDesk) – ANZ Bank New Zealand, the country’s biggest lender, was the most aggressive in pitching interest rate swaps to farmers, over which it subsequently agreed to pay $19 million in compensation, the Commerce Commission says.

General counsel competition Mary Anne Borrowdale told Parliament’s primary production select committee that of the three banks to settle with the regulator, ANZ had the most customers involved and was investigated over both the way it was able to move its margin and the break fees it charged farmers for an early release. While ANZ announced its settlement with the regulator before ASB Bank and Westpac Banking Corp, it only just made its offer to farmers yesterday. The three banks’ collective settlements totalled $24.2 million. . .

Landmark animal welfare legislation welcomed by veterinarians:

The New Zealand veterinary profession welcomes today’s landmark passage of the Animal Welfare Amendment Bill which brings greater clarity, transparency and enforceability of the country’s animal welfare laws, further strengthening New Zealand’s excellent reputation for animal welfare.

The New Zealand Veterinary Association (NZVA), which played a key role in helping to shape the Bill, says some of the key changes include the legal recognition of animal sentience, which is sensation or feeling in animals, for the first time in New Zealand law.

NZVA President Dr Steve Merchant says: “Veterinarians are at the vanguard of animal welfare advocacy and public support is behind us in the call for greater clarity on issues concerning animal welfare and increased sanctions for animal cruelty. . .

 

 High prices and volumes for avocado growers:

Avocado exporter Avoco says its growers are celebrating the end of a season where they not only got a bumper crop – but decent prices for their fruit too.

Avoco said strong end-of-season demand from Australia lifted returns for growers – to $15 per tray for large avocados and $14 per tray for smaller fruit.

Avoco director John Carroll said the company exported a record volume of fruit – 4.5 million trays, out of a total 7 million trays – and still managed to get good returns for its 700 plus growers. . .

Anchor Gives More New Zealanders an Organic Milk Choice:

Anchor is making organic milk more accessible to New Zealanders with the nationwide launch of Anchor Organic.

Fonterra Brands New Zealand Managing Director Tim Deane said that with other organic milk brands only available in certain regions or very expensive, Anchor is on a mission to make organic milk more widely available at a fair price.

“We want to put organic milk in reach of more New Zealanders. We’ve done just that through our nationwide distribution and providing Anchor Organic at an everyday price that works out at only about 20 cents extra per glass compared to our standard Anchor milk,” said Mr Deane. . .

Wool Prices Bounce:

New Zealand Wool Services International Limited’s General Manager, Mr John Dawson reports that a weaker New Zealand dollar, limited wool volumes pressuring exporters and renewed client interest, combined to lift local prices across the board.

Of the 6,350 bales on offer, 99 percent sold.

The weighted indicator for the main trading currencies was down 1.79 percent compared to the last sale on 30th April.

Mr Dawson advises that Fine Crossbred Full Fleece and longer shears were 7 to 10 percent dearer, stimulated by resurgent Chinese interest with shorter types 3 to 6 percent firmer. . .


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