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The economy is in for a $2 billion transfusion from Fonterra’s forecast of a potential record 2010-11 season payout of “well over $8″ – but the patient is being warned not to party up large again.

 Yesterday Fonterra startled the industry and financial circles by following up a respectable opening forecast payout of $6.90-$7.10/kg milksolids for the season, which begins next week, with a longer range forecast of a possible $8-plus final season payout – if international dairy prices and foreign exchange rates hold at current levels.The opening forecast, which combines a milk price of $6.60 and a forecast distributable profit of 30-50c/kg, means around $650m more for the economy in the 2010-2011 year – but an $8-plus payout would mean a $2b economic bonanza, says Bank of New Zealand head of research Stephen Toplis.The $8 payout would mean a close to $1m income for a farmer producing the industry average of 120,000kg in the season. Out of this has to come the farm’s running costs, tax, labour, family costs and new Emissions Trading Scheme taxes reports Stuff.

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Fonterra has set its first payout forecast for the 2010/11 season, lifting its outlook for the milk price by around 50 cents per kilo to around NZ$6.60/kg.

Once dividends from profits are added, Fonterra could produce a payout of around NZ$7/kg. This would be the second highest payout in Fonterra’s history after the record NZ$7.62/kg paid out in 2007/08. Fonterra chairman Henry van der Heyden said it was possible the final payout could be over NZ$8/kg if the exchange rate and commodity prices stayed at their current levels. This would add up to NZ$2 billion to the economy from the NZ$2009/10 season, assuming the drought of the last few months does not hurt output too much reports interest.co.

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The Animal Health Board (AHB) has successfully prosecuted a Waiuku farmer for the illegal sale of cattle from a bovine tuberculosis (TB) infected herd. Geoffrey William Muir pleaded guilty at the Pukekohe District Court today to moving and selling cattle in breach of a restricted place notice imposed by the AHB in June 2008.Muir was fined $30,000 and $140 court costs. The AHB was awarded $10,454 in costs and $2,500 in legal costs. Muir was convicted on four charges of failing to notify the movement of an infected herd, making a false and misleading declaration, moving cattle to a third party’s farm and knowingly selling 157 cattle from a herd that was suspected of harbouring TB reports Scoop.

AHB chief executive William McCook said the prosecution showed the AHB would take action against farmers who fail to abide by livestock movement regulations. “It is clearly unacceptable that one man put his fellow farmers at risk for his own pecuniary gain. Selling cattle from a herd that is suspected or known to harbour bovine TB could have serious consequences for the national TB control programme. “We know a vast majority of the 73,000 cattle and deer farmers in New Zealand willingly comply with movement control restrictions and expect us to come down hard on those farmers who do not.

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A Manawatu dairy farmer believes he is the only farmer in NZ leaving heifer calves on cows reports The Manawatu Standard. Jeff Williams and his wife Janice have a farm on No1 Line, near Longburn. They recently hosted a field day looking at the biological farming system they use. Mr Williams said biological agriculture works on organic principles but uses modern science and technology as well. It aims to have healthy soil, which is the basis from which all plants grow, and provide for the wellbeing and sustenance for the cows.

About 50 people attended the field day, including dairy farmers, biological agriculture staff and Massey University staff. Mr Williams said he and his wife have 400 cows, of which half calve in spring and half in autumn. This autumn is the first season the Williams’ have kept their replacement heifers, and a few calves being raised for beef, on their mothers.

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Improved productivity could reduce on-farm greenhouse gas emissions from sheep by up to 12%, according to the author of a study which calculated the carbon footprint of sheep. Stewart Ledgard, a principal AgResearch scientist, said a higher lambing percentage and faster lamb growth rates offered the best options for reducing greenhouse gas emissions from sheep, as opposed to reducing fossil fuel use, which was low on sheep farms compared with other intensive agricultural systems.

Dr Ledgard said the 1.9kg of CO2-equivalent produced for each 100g portion of lamb exported to Europe, was “broadly consistent with other international studies of products derived from farmed, ruminant livestock reports The ODT. His study found 57% of the sheep carbon footprint was generated by the natural process of animals utilising pasture and producing methane during digestion, but it was a figure that has been decreasing.

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The dairy boom continued in Canterbury and Southland with the South Island dairy herd up 13 per cent last year to 2.1 million, according to official figures. The South Island dairy herd is almost seven times the size it wasy 20 years ago. Canterbury was the South Island’s largest dairying region, recording 10 per cent growth to reach a herd size of 918,000, followed by Southland, where numbers grew 19 per cent to reach 589,000, according to the final results of the 2009 Agricultural Production Survey reports Stuff.

National dairy herd numbers reached a record high of 5.9 million at 30 June 2009, up 282,000 since 2008. The size of the North Island herd remained stable at 3.8 million. Factors contributing to the South Island growth include continued dairy conversions, a smaller number of dairy cows and heifers going to the beef herd, more older cows remaining in milking herds, and the sourcing of dairy heifers from the North Island. “In 2009, South Island dairy cattle numbers were almost seven times larger than 20 years ago when there were 312,000 dairy cattle,” said agricultural statistics manager Gary Dunnet.

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Drought has closed most of Fonterra’s 86 dairy processing plants around NZ this season several weeks earlier than usual reports Stuff. The dry weather has pinched supply to 70 per cent of Fonterra’s factories – most north of Taupo – forcing them to stop processing before the usual winter shutdown for maintenance, said general manager milk supply Tim Deane.

However, the farmer-owned co-operative and NZ’s biggest company, which processes 92 per cent of the country’s raw milk, said national milk production for the 2009-10 season would still be “a fraction ahead” of last season’s collection of about 14 billion litres of milk – thanks to South Island production. Drought in the upper North Island – Northland and Waikato – had cut daily milk production for this time of the year back 45 to 55 per cent on last season, Mr Deane said.

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It had been another tough year for many of the region’s farmers, Mr Evans said in his annual report in the Marlborough Express. A cold, wet spring had produced insufficient growth in areas, in particular the high country, but other parts of Marlborough had seldom had a better run into summer. However, the good times had come to an “abrupt end” with a very dry autumn. The emissions trading scheme was a major issue for farmers and nothing less than “workplace bullying”.

 Meat and Fibre chairman William Grigg said the demand for both beef and lamb was up on last year in international markets. Mr Grigg said Australia and the United States were in a herd-rebuilding phase and a looming shortage of beef, domestic and imported, had seen prices soar in recent weeks.

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Police and the Southland District Council will take a hard line against farmers whose stock are found wandering on roads after a reported 13 crashes this year reports The Southland Times.Three drivers were injured in the crashes, seven of which involved cattle. Horse, sheep and deer were also involved.Senior Sergeant Kerrin Price, of the strategic traffic unit, said in the latest serious incident, officers were on Saturday called to deal with a “stroppy and aggressive” bull wandering in Oporo Flat Rd, near Wallacetown, that had tried to attack a cyclist.

Stock control officers were called and they recognised the bull as one they had been called out to twice four days earlier. The owner could not be found so the bull was shot because of public safety fears. A Dacre woman who narrowly escaped serious injury after hitting a cow near Woodlands last month said she wanted farmers to take more care with fences. The woman said she had little time to react when the black cow loomed up in her headlights while travelling home one night.”It’s not good enough – the farmer should have the boundary fence hotwired. Cattle have no respect for ordinary fences.” Mr Price said officers were amazed she had walked away without injury. The next motorist hitting wandering stock might not be so lucky, he said.

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