Silver Fern Farms’ shareholders have backed the board in its plan to enter into partnership with Shanghai Maling:
A strong majority of 80.4% of votes in favour of the 50/50 partnership with Shanghai Maling reinforced Silver Fern Farms Board’s position that the partnership is in the best interests of shareholders and the Co-operative.
The resounding support from shareholders came at a Special Meeting requisitioned by Messrs John Shrimpton, Blair Gallagher and a group which included 31 other shareholders who supported a statement stating they wanted to stop the $261m investment into Silver Fern Farms.
The 80.4% of shareholders’ votes in support of the partnership follows the result of the October 2015 vote, where 82% of votes cast supported the transaction. Both vote results exceeded the 75% Special Resolution threshold put forward by the Requisitioners. Chairman Rob Hewett said it was pleasing shareholders remained overwhelmingly supportive of the partnership.
“While the Board has clearly stated its view that the outcome of this meeting could not bind the company given the valid and binding approval last October, it is pleasing to see shareholders reaffirm their support and maintain their confidence in this exciting opportunity to create a sustainable Silver Fern Farms,” Mr Hewett said.
Mr Hewett said the partnership would create a strong Silver Fern Farms.
“This partnership will enable us to generate higher, sustainable returns for our shareholders.
“Shareholders have again made it clear they want progress for their company. They want meaningful change and are genuinely excited about the prospects presented through this significant investment and partnership with Shanghai Maling.
“The Board has strongly disagreed with the negative stance on the transaction taken by Messrs Shrimpton and Gallagher. They have caused significant disruption and their actions have been damaging to the company. Their allegations have proven to be entirely unfounded. Independent reviews by both the Financial Markets Authority and the Registrar of Companies have found no issue with the information provided to shareholders in October 2015 or the actions of the Directors.
Chief Executive Dean Hamilton said the process to complete the transaction had continued with all outstanding information now with the Overseas Investment Office for its consideration.
“We remain confident that we will achieve OIO approval prior to 30 September, and proceed to complete the transaction by 4 January 2017 as previously announced.
“The clear message from the voters is to get on with it, and realise this opportunity ahead of us.”
2610 shareholders voted representing 62.15% of eligible votes.
John Shrimpton says he accepts that shareholders have spoken.
New Zealand First which has also been a very vocal opponent of the plan continues to show it doesn’t understand the issue:
New Zealand First says Silver Fern Farms’ shareholders will regret selling majority control of their co-op to the Chinese but expects the Overseas Investment Office will greenlight it at breakneck speed.
“Today was the owners of Silver Fern Farms last chance to preserve one of New Zealand’s great assets for present and future farmers,” Mr Peters says. . .
“How is it that foreigners can see value in what we produce, but the producers and this government can’t? Meat progressively joins forestry and increasingly dairying to condemn farmers as price takers at the bottom of the heap. . .
This was a matter for shareholders not politicians.
SFF needs a large investment if it is to survive. Shareholders weren’t prepared to invest more and the company wasn’t able to get other investment from within New Zealand.
If the partnership doesn’t go ahead the company has no future, and even if it does get OIO approval, SFF has a lot of work ahead of it.
The deal leaves Alliance Group as the only co-operative in the meat industries, farmers who prefer that model can choose to support that company.
Hawke’s Bay farmer Hugh Ritchie said today if Greenpeace acutally understood the big environmental issues facing New Zealand, such as climate change, it wouldn’t need to interfere in a local water storage project like Ruataniwha.
“Hawke’s Bay people can decide what’s best for their community without the influence of this misguided and uninformed green lobby. These out-of-town protesters need to realize robust public process has been followed and the scheme has been intensely scrutinized.
“Ruataniwha has been through the Environmental Protection Agency (EPA) process. Individuals and groups have had ample opportunity to voice concerns and these have been accessed for merit. This same EPA process saw an end to Wellington Basin Reserve’s proposed flyover. The EPA delivers robust, objective decisions on environmental matters, and ensures compliance with rules. Its decision must be respected. . .
The auditor-general has ruled a Hawke’s Bay regional councillor can continue voting on the Ruataniwha dam, despite finding she is likely to have a pecuniary interest in decisions the council makes about the project.
Debbie Hewitt represents Central Hawke’s Bay, the area where the council is planning to build the Ruataniwha irrigation scheme.
Through a family trust, she has an ownership interest in 19 hectares of land in an area that would be irrigated by the scheme. The Office of the Auditor-General said it was “uncertain” how much she would gain financially if the scheme went ahead, but it believed her interest in it was greater than that of the general public. . . .
Good health and safety practice is not something you can just buy off the shelf, and farmers need to build health and safety into everyday activity on farm.
WorkSafe’s Agriculture Programme Manager, Al McCone, says while many farmers will want to get consultants in to give them expert advice, there is no single product or document that is a silver bullet for farm safety.
Farmers should only employ competent and qualified professional health and safety advisors. “When selecting a new contractor or buying stock, farmers do their homework,” says Mr McCone. “They shop around, look online, ask other farmers and make a decision based on sound information. The same should apply to buying health and safety advice and resources. . .
Big bounce in farmer confidence – Rabobank: Rural Confidence Survey
Results at a Glance
Overall farmer confidence has improved considerably from the previous quarter
Farmers’ expectations for their own business performance also rose, with big lifts recorded among dairy farmers and sheep and beef farmers
Horticulturalists’ expectations for their own businesses remain at elevated levels with more than half surveyed expecting their farm business performance to improve in the next 12 months
Investment intentions were at their highest level in more than a year, with one quarter of survey participants expecting to increase their farm business investment in the coming year . .
New Zealand company, within its first year of operation, has been named as a finalist in two categories in theWorld Dairy Innovation Awards; Best Ice Cream or Frozen Yoghurt and Best Dairy Packaging Design.
Spring Sheep Milk Co is the only fully New Zealand owned large scale sheep dairy operation and the attraction for forming the company was to create a model to bring the goodness of New Zealand sheep milk products to the world says Chief Executive Officer Scottie Chapman
“Consumers are looking for quality alternatives to traditional dairy and sheep milk offers a premium alternative thanks to its sensational taste. It is richer and creamier than traditional cows milk. Sheep milk has been used in Europe for centuries as a gastronomic indulgence, renowned for quality cheeses and is now a rapidly growing category worldwide.” . .
• Companies Office completes consideration of complaint from Rt Hon Peters
• Has “not identified any evidence of a breach of s 138A of the Companies Act 1993”
• Follows announcement from the Financial Markets Authority (FMA) confirming FMA does “not have any reason to believe the [Notice of Meeting and Shareholder] Information Pack was misleading or deceptive.” . .
(BusinessDesk) – Murray Goulburn Cooperative, Australia’s dominant milk processor, announced its forecast farmgate milk price for the coming year, saying it expects only a modest recovery in prices in the second half of the year.
The company forecast a farmgate milk price of A$4.80 per kilogram of milk solids for the season ending June 30, 2017, compared with an expected payment of between A$4.75 to A$5.00 in the current year. It announced a 2017 net opening farmgate milk price of A$4.31/kgMS after repayment of a 14 Australian cents/kgMS milk supply support package. . .
The author of a new book documenting traditional methods of growing yam says the book has preserved indigenous crop planting knowledge that’s valuable for Pacific farmers.
The book ‘Tokanga ko e Mo’ui’anga’ has been published in the Tongan language and was launched in Auckland by author Sione Tu’itahi.
Mr Tu’itahi based the book on the experience of the late Kiteau Tatafu, an award-winning farmer in Tonga. . .
National’s three-point rise to 50% in the latest One News Colmar Brunton poll has come as a surprise to some commentators.
Labour’s four-point fall to 28% was probably not.
It is only one poll and anything could happen between now and the election but Kiwiblog shows where the two parties were at the same time in the last election cycle:
In April 2013 National was at 43% and Labour 36% – a 7% gap.
In April 2016 National is at 50% and Labour 28% – a 22% gap.
He points out that Labour leader Andrew Little is on only 7%, three points behind Winston Peters.
This isn’t a strong position from which to launch a winning election campaign.
In another post, Kiwiblog looks at party favourability:
. . . National is viewed favourably by 58% of NZers. That helps explain why 47% voted for them.
Labour is viewed favourably by just 35% of NZers. . .
National has the least unfavourable – only 28% of NZers dislike National. This will come as a surprise to hard left activists who live in a bubble where 100% of their friends dislike National. . .
Labour is on 41% for unfavourability.
National at +30% is the only party to have net favourability:
National’s continual popularity confounds its critics and many commentators.
There are several reasons for it and one of the biggest is that the government focuses on the basics while Labour gets distracted by sideshows.
That doesn’t mean everything the government does works well. I am tribal National and there are some things the government does I don’t like and some it doesn’t do I’d like it to, but those things don’t matter as much as the basics – the economy, education, health, welfare, and security.
And of course, one big reason National is doing so well is that Labour isn’t.
National can’t rely on that if it wants to win a fourth term, a viable government needs to be there for better reasons than a hopeless opponent but Labour’s continuing focus on side-shows and showing its incompetence in opposition keeps demonstrating it is not a viable government-in-waiting.
If I’m from the government, I’m here to help, is greeted with suspicion, the sudden enthusiasm Opposition MPs are showing for the regions in general and dairying in particular is being seen as nothing more than political opportunism.
The Chicken-Littleing from Labour, the Greens, New Zealand First and some media isn’t helping.
The sky isn’t falling.
Dairy prices are lower in real terms than they have been for more than 20 years which is a challenge for farmers, sharemilkers, their staff and those who service and supply them.
There were a few forced farm sales and other business failures when the dairy price was over $8.
There will be some more in the coming months and that will be very difficult for everyone affected.
But most will hang on, with the support of their banks, and get through what is a temporary slump.
Labour leader Andrew Little’s attempt to demonise banks did nothing more than show he doesn’t understand what he’s talking about.
His calls for stiff arming banks and legislation to force them to pass on interest rate cuts has been greeted with the derision they deserve.
His response to the Reserve Banks’ explanation about its stress-testing of banks provided further evidence he doesn’t know what he’s talking about.
The media release made it clear the banking system was robust to a severe dairy stress test.
. . .Five banks that are the largest dairy sector lenders participated in a stress test run by the Reserve Bank in late 2015. Two scenarios were tested, with scenario one assuming that the dairy payout recovers to $5.25 per kilogram of milksolids by the 2017/18 season and a fall in dairy land prices of 20 percent. Under the second scenario, the dairy payout was assumed to fall to $3 in 2015/16 and remain below $5 until the 2019/20 season with a fall in land prices of 40 percent.
Head of Macro Financial Bernard Hodgetts said both scenarios assume the dairy payout remains lower for longer than was assumed in the economic projections contained in the Reserve Bank’s March Monetary Policy Statement.
“On average, banks reported losses under the two scenarios ranging between 3 to 8 percent of their total dairy sector exposures,” said Mr Hodgetts.
“Bank lending to the dairy sector stands at around $38 billion, which is approximately 10 percent of the banking system’s total lending. We would expect losses of the order seen in the stress scenarios to be absorbed largely through lower bank earnings rather than through an erosion of bank capital.”
The test results suggested that in the shorter term, banks would increase their dairy lending in order to support existing borrowers facing negative cash flow, before facing a longer term rise in loan losses if there were a prolonged dairy sector downturn. . .
Anyone who understood this would have been pleased that banks were prepared to support existing borrowers and could cope with losses in a worst-case scenario.
That Little didn’t understand it became evident at Question Time on Wednesday:
Andrew Little: Is he at all concerned about the Reserve Bank’s projection that dairy land values will crash by between 25 and 40 percent, which will undermine the livelihoods of thousands of Kiwis?
Rt Hon JOHN KEY: That is the problem with the Leader of the Opposition—it is that you cannot take him seriously, when he actually misrepresents the Reserve Bank Governor. The Reserve Bank Governor is not saying there is a projection that land prices will drop by 25 to 40 percent; he is doing a stress test to say what would happen if land prices went down. There is quite a—
Grant Robertson: And that’s the scenario we’re in now.
Rt Hon JOHN KEY: Well, banks—reserve bankers do that all the time, because their prudential requirements require them to make sure the banking system is strong. And what he is saying is, even under a worst scenario like this, the banking system is very strong.
Andrew Little: Has the Prime Minister actually read the Reserve Bank’s report released at 2 p.m. today; if so, has he read it?
Rt Hon JOHN KEY: No, what I have read is the release—the press release—because it came out at 2 o’clock today, and I got this only 1 minute before I came here. But what the release says quite clearly is (a) the banking system is very strong, (b) under its worst-case scenarios—to quote—“The test results suggested that in the shorter term, banks would increase their dairy lending in order to support existing borrowers …”, and it is saying that even in the worst scenario, the losses could be between 3 percent and 8 percent of their total dairy exposure. Banks have considerably more exposure than just this, and, as the member was pointing out yesterday, banks have been making pretty good money. They can afford, if they have to—
Mr SPEAKER: Order! Bring the answer to a conclusion
Rt Hon JOHN KEY: —to take some losses in that sector.
Andrew Little: Does he agree with Mind Your Own Business that “approximately 100,000 businesses employing upwards of one million New Zealanders are facing reducing revenue because of the dairy downturn.”?
Rt Hon JOHN KEY: I do not have anything to back that up—I would need to see the analysis. But it could be as small as a business that is affected, from someone who sells sandwiches to someone who works in that area. There is a very large range of businesses in that sector.
Andrew Little: Is it fair that our dairy farmers go bankrupt and 100,000 small businesses face reduced revenue while overseas-owned banks continue to make $90 million a week and speculators circle over our farmland?
Rt Hon JOHN KEY: The member is, I think, terribly confused about what is happening. What you have got is a scenario where dairy prices are lower, and what we should be doing is supporting dairy farmers with the things that we can control. We cannot control the exchange rate and we cannot control commodity prices and we cannot control the weather. We can control free-trade agreements, planning laws, health and safety, Resource Management Act reform, and a variety of other things, and on this side of the House we support helping those farmers, actually, in good times and in bad.
With the exception of West Coast Tasman, Palmerston North and Winston Peter’s opportunistic enthusiasm for Northland, Opposition parties don’t even try to win regional seats.
Their MPs flit in for photo opportunities but their sudden faux support for dairy farmers merely shows how little they understand the people and the issues.
The dairying downturn is a passing car at which the Opposition is barking.
Farmers don’t want banks strong-armed, they don’t want bail-outs and they certainly don’t want a return to the any of the government-knows-best policies, the recovery from which necessitated the radical reforms of the 80s and 90s.
Those are mad ideas from the Opposition and they won’t help.
The headline : Winston leaves trial of destruction refers to the devastation left in the wake of a topical cyclone.
That’s no joking matter when homes have been wrecked and at least one man has died.
But my first though on reading the headline was not of the cyclone in Fiji but the politician in New Zealand.
“More chance of me holidaying on the lunar space station I would’ve thought,” he said at his post-Cabinet news conference today.
“There’s no chance. . .
“It’d be totally unacceptable to the New Zealand public. Being Prime Minister is not something that is traded away with a bit coalition partner to get them over the line.”
Mr Key wasn’t sure how that would even work.
“He could take the weekends? Give me the time off, it’d be quite nice. Outside of that, I don’t see it working. It’s a joke.” – John Key commenting on the suggestion that Winston Peters could be Prime Minister in a National-led government.,