Elders Rural Holdings Ltd. relies on its battling Australian parent for financial support and may have to sell assets if that support is withdrawn, notes to the NZ company’s accounts say. Adelaide-based Elders Ltd., which owns 50% of rural services group Elders Rural, has pledged 12 months’ support, according to notes to the NZ firm’s accounts. That support makes up for a forecast shortage of cash flow at Elders Rural, which posted a net loss of $8.98 million in the 15 months to Sept. 30, the second straight loss reports Scoop. Elders Australia made an unsecured $63.6 million advance to Elders Rural in the latest period, charging 7.25% interest.

Elders Rural is launching its Just Shorn branded wool into the U.S. market, one of several initiatives to squeeze more margin out of the fibre in a divided industry that has walked away from research as returns dwindle. Rival Wool Partners International, which has Theresa Gattung as chairwoman, owns the Laneve mark. Both groups are inking supply deals with U.S. manufacturers.

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Silver Fern Farms has made a half-year loss of $14.3 million before tax from revenue affected by fewer lambs to kill and a high dollar, but believes it will make a profit by the year’s end reports Stuff. Revenue for NZ’s largest meat processor fell to $784.3m in its interim result for the six months ending February, $217m less than last year’s first half. However, the first half of the year is usually the worst trading performer as was the case in the 2008/09 season when SFF rebounded from a $16.5m loss to post a second-half $21m profit for a better year-long result.

After this season’s poor start its meat plants were running at full capacity in March and April and the co-operative has already recouped the losses of the first six months and is now in a profit position. Trading was complicated initially by farmers holding on to livestock from a good growing season in combination with low seasonal flows to stunt meat processing, with SFF having to wear the cost of plants performing under capacity. The co-operative has taken some comfort from retaining its market share as the meat industry adjusts to the national kill dropping by 1.5m lambs.

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Farmers’ economic confidence improved in the first months of 2010, boosted by sheep and beef prices although optimism in some regions was restrained by drought conditions, a new Rabobank survey shows. It found 34 percent of farmers expected the rural economy to improve in the next year, up from 32 percent previously, while the proportion of farmers expecting conditions to worsen fell to 11 percent from 26 percent reports The ODT.

The Rabobank rural confidence survey was completed this month but before yesterday’s announcement by Fonterra that it had increased its milk price forecast for this season by 40c to $6.10 a kg of milksolids. Rabobank general manager rural NZ Ben Russell said the survey showed much of the improvement in rural confidence had been driven by sheep and beef farmers, who had a more optimistic outlook about their sectors. Factors working in the favour of sheep and beef producers included a small fall in the NZ dollar during the survey period, and good news in terms of commodity prices in the sectors.

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Agriculture Minister David Carter yesterday received an earful from Marlborough farmers outraged at agriculture being included in the emissions trading scheme (ETS). The farmers waited for Mr Carter to finish a speech about the scheme at Meadowbank Station in Taylor Pass before unleashing a barrage of questions and statements reports The Marlborough Express. Mr Carter said he did not believe that climate change was “rubbish”. Over the past 20 years there were a “hell of a lot” more emissions of greenhouse gases which produced a “human-induced” effect, he said.

Marlborough farmer Warren Taylor said farmers needed to stop arguing about the science and whether the scheme should go ahead and instead try to use it to their advantage. “We can bitch and moan about it whether it’s getting warm or not; let’s make a buck out of it.” Marlborough Federated Farmers president Geoff Evans said the farming sector would not be able to compete in international markets because of a “perpetually” increasing ETS tax while foreign competitors received subsidies.

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Weaner deer prices at early season sales are back a little on last year but that is no bad thing, say sector leaders. “Generally speaking things are heading in the right direction,” says Deer Industry NZ (DINZ) chief executive Mark O’Connor. Tight supply is maintaining in market prices despite the economic downturn but a stronger kiwi dollar – or more accurately weak Euro – has taken the shine off schedules here reports The Rural News.

“Our main markets are still in Europe so the Euro [weakness] is a challenge for us,” says O’Connor. “Things might be a little slower than last year but supply has dropped and our marketing continues unabated.” That said, frozen sales in recent months have been “at a reasonable level” which augurs well for the coming chill season. “We want to see a reasonable level of stability in the market and here in New Zealand. It’s important weaner prices are reasonable and offer a profit for breeders and there’s still a return in it for finishers.” The $6/kg plus prices of top end weaners last autumn were “way too high”, he adds.

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The number of bovine tuberculosis (TB) infected herds dropped below 100 in March for the first time in the history of NZ’s TBfree programme. According to last month’s figures, a total of 91 cattle herds and seven deer herds were infected with bovine TB reports Scoop. “While this is a big step towards becoming TB-free, we are mindful that the number of infected herds traditionally increases over the coming four to six months,” says Dr Paul Livingstone, Animal Health Board (AHB) technical manager.  “The size of this increase, however, will depend on the quality of possum and other pest control over the past two years. Identifying infected stock before they’re moved off the property is another critical factor.

“We certainly can’t afford to rest on our laurels, although this is a considerable improvement on the same time last year, when 119 cattle herds and 10 deer herds were infected with bovine TB. “While possums remain the main source of TB infection in livestock, a smaller but no less significant number of herd breakdowns have been caused through uncontrolled stock movements.

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A combination of better-than-expected meat payouts and renewed confidence is believed to be behind a significant rise in fertiliser demand, with companies reporting strong sales this autumn reports The Southland Times. Fertiliser use fell about 30 per cent last year as farmers looked to save money. Experts warned last year that cutting back fertiliser could have a long-term impact on pasture production.

Sales have not reached the levels they were before the recession, but both Ravensdown Fertiliser Co-Op and Ballance Agri Nutrients have reported a noticeable lift this autumn, as sheep and beef farmers address nutrient shortfalls. More farmers were carrying out soil testing to determine where fertiliser was most needed to stretch their money further and achieve the best benefits.

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A long, painful dry spell for farmers has helped cut the country’s greenhouse gas emissions. As farmers suffer, the latest official tally from the Ministry for the Environment reveals NZ is doing better than expected in the carbon stakes, partly because farms have had to cull more animals reports The NZ Herald.

Because the national herd is smaller than expected the amount of greenhouse gas the country is expected to make by 2012 has fallen by 1.8 million tonnes. But that is likely to come as little comfort to farmers. Dairy farmers north of Taupo have been cutting milk production earlier than usual, and so far rain has failed to penetrate soils in the most parched regions. In the Waikato, figures from the Ministry of Agriculture and Forestry show the drought has cost farmers an average of between $100,000 and $200,000 this year.

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NZ agriculture has as little as five years before large-scale intensive farming in South America, western China and central Asia erodes its cost advantage in producing bulk commodities, according to accountant KPMG. Their Agribusiness Agenda report observes that these regions have the benefit of lower-cost land and labour and less complex regulatory regimes. “In addition, they are traditionally closer to key markets, enabling them to deliver food to the customer at a significantly lower cost than a competing new farmer or grower in NZ could achieve,” KPMG agribusiness chairman Ross Buckley said in Stuff.

“This gives NZ companies a short buffer, maybe as little as five years, before low-cost regions are producing bulk commodity products in significant volumes and undercutting NZ’s pricing in our traditional commodity markets.” Because of this, it was now time to start revising industry structures, practices and products to give NZ produce better value well in advance of large-volume commodities from these new suppliers.

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Horizons Regional Council is still pushing to make intensive farming a controlled activity in the region and expects about 40 per cent of farms will need to clean up the way they operate reports The Manawatu Standard. The council is also not budging on its decision to keep stock out of waterways. Horizons wants to implement rules under the water chapter of its proposed one plan that allow only 20kg to 30kg of nitrate loss per hectare per year.

Of the 1000 dairy farms, irrigated sheep and beef, horticultural and cropping in the region, about 60 per cent are believed to already be within the proposed standards for nitrate loss. Farmers who can prove they are already meeting these standards will not have to apply for consent. Those who can’t will have their nitrate loss treated as a controlled activity and will have to take steps to lower their nitrate usage.

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