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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Resource consent has been granted for an irrigation scheme that could generate 1200 jobs and $170 million in benefits for South Canterbury reports The Timaru Herald. Environment Canterbury (ECan) yesterday approved a resource consent for the Hunter Downs irrigation scheme that would potentially irrigate up to 40,000 hectares of South Canterbury farmland. South Canterbury Irrigation Trust spokesman Don McFarlane said the decision was another step forward in the progress of the scheme. “This was D-Day. This was the final tick-off. It’s the one that says, `you can use the water and we approve of the way you are going to use that water’.”

It was good for the region, parts of which were very dry, and had the potential to generate up to 1200 jobs and $170m in benefits. “[ECan] commissioners are obviously satisfied that the farm management plans we proposed and the audits we proposed were going to achieve all of those issues around water quality,” he said. The decision comes three and a half years after the consent was formally lodged. Mr McFarlane said if there were no appeals, the next step would be to begin designing the delivery infrastructure for the scheme and to talk to farmers in the area about its commercial viability.

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Fonterra has announced a 40 cent increase in its forecast milk payout for this 2009-10 milk season to $6.10 per kilogram of milk solids. Continued strength in global dairy prices, with demand growth beginning to outstrip supply, had driven the board’s decision to increase the forecast milk price, said chairman Sir Henry van der Heyden. The increase is the first since the forecast milk price was raised by $1.10 last November reports Stuff.

“This extra 40 cents per kg/ms will be welcomed by our farmer shareholders and also confirms that 2009/10 is shaping up as the second best in terms of cash payments to Fonterra farmer shareholders,” Sir Henry said. However, it came at a time when many farmers, especially those north of Taupo, were suffering from worsening drought conditions.

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Wool Equities, which relies on interest from bank deposits for income, said it expects to announce partnership proposals for wool ventures in the next few months. Earlier in April, the company said it was holding talks with Romney NZ to form a joint venture to produce and market designer rugs in the US reports Stuff. The potential of the market was confirmed by International Design Group, a chain of stores in the US that sells floor coverings.

The company’s last remaining investment, keratin producer Keratec, was sold to US-based Keraplast Technologies last year when the two companies failed to agree to a joint venture. Wool Equities subsequently bought back two of every three shares held for about $1.4 million, shrinking stock on issue to 15.7 million from 23.9 million. “Several of these partnerships are close to fruition and we, as a Board, expect to make a number of announcements relating to specific partnerships and product proposals in the next few months,” chairman Clifford Heath said in his interim report.

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A former agricultural science leader has delivered a broadside at what he sees as a lack of objectivity in the science structure, saying there is little technology transfer and it is impossible to separate “good science from company spin”. Jock Allison, the former director of the Invermay Research Centre, told the Clutha Agricultural Development Board annual meeting last week that scientists no longer talked to farmers and the competitive funding model for science did not allow for research results to be passed to farmers reports The ODT.

“Often, useful technologies are not promoted to industry as there is no financial allocation to ensure that happens,” he said. “The research bodies are just ticking off the contracts and moving on to apply for the next two- or three-year period of funding.” Dr Allison was also scathing about the impact on technology transfer of crown research institutions entering commercial alliances in which companies invest in and own the results.

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The outgoing AgResearch chief executive, Andy West, says the failed merger bid is the biggest regret of his six-year stint at the CRI.West wants a future government to “definitely take a system-wide view of universities and CRIs”. He believes the merger of AgResearch and Lincoln would have been “a bold move” for NZ. It was mooted by the two parties in November 2008 and a public announcement was made in March last year.

However, six months later the talks were called off and both parties decided that a partnership would deliver more benefits than a full amalgamation.West says the merger process was derailed by the global financial crisis.“We were funding the merger with our own resources,” he told Rural News.

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Real estate leaders are warning overseas investors could start dominating the rural property market unless banks start backing local farm buyers reports The Otago Daily Times. Real Estate Institute of NZ president Peter McDonald said a lack of confidence from lenders had seen property sales for the three months to March 31 this year remain low, with just 210 selling compared with 231 for the corresponding period a year ago and 717 in 2008.

The comparable figures for Otago were 17, 21 and 82 and for Southland 19, 16 and 104. Farms were for sale but Mr McDonald said most were not advertised because the seller had had transactions fall over due to finance not being forthcoming for the buyer. “Banks will deny it and say their policy is the same, but at the business end nothing is happening, transactions are falling over. A purchaser who would’ve qualified [for finance] a few months ago no longer qualifies,” he said.

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A group of Waikato farmers who say they received emaciated stock back from a Waikato grazier last season are considering legal action. The group, who complained to Waikato Federated Farmers in November, are taking legal advice on the case, according to Dairy Industry Group chairman James Houghton. Fed Farmers had not taken sides in the case, but provided the group with details of a lawyer experienced in the area, reports The Waikato Times.

Mr Houghton said the case, coupled with the declaration of a medium-level drought, served as a timely reminder to farmers to check stock sent to graziers every 10 days to two weeks. Reputable grazier Richard Strang, who grazes 500 dairy heifers for other farmers on his Putaruru farm, agreed with Mr Houghton. “If I have got someone else’s cattle on my property it’s my responsibility to provide supplementary feed for them,” he said. He said he had no objections to farmers viewing their stock, so long as they contacted him first.

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A PGG Wrightson livestock manager and auctioneer has been fined $11,000 and ordered to pay $9000 in vet and investigations costs for leaving more than 1400 sheep to starve. Stock agent Neville William Clark, 46, pleaded guilty on Monday to leaving 250 sheep, 1100 lambs and 120 in-lamb ewes on a 412ha forest block just south of Gisborne reports Stuff.

Those not already dead were worm- ridden, weak and emaciated. Dozens of the animals were euthanased. Judge Adeane said Clark was a first-time offender, and there was no suggestion he was “willfully cruel for the sake of cruelty. Rather he has fallen short of good [farming] standards”. An Agriculture and Forestry Ministry statement of facts presented to Gisborne District Court this week said the land could not possibly have provided enough feed for the animals.

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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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