Hind prices in New Zealand

2008 News Archive

Our competitors flock/herds are declining also
Australia’s cattle and sheep numbers declined throughout the 2007-08 fiscal year, as drought continued to ravage southern Australia. M&L Australia is reporting that the latest figures to show Australia’s cattle herd for the year ending 30 June 2008 declined 0.8pc to 27.8 million head.The sheep flock dropped 7.6pc to 79.2 million head, the lowest national flock since 1920. more>>
And in the US
All segments of the US beef industry are contracting, according to National Cattlemen's Beef Assn president Andy Groseta, and the latest US Department of Agriculture Cattle on Feed report seems to support that conclusion. "What we're basically looking at are the number of cattle on feed in the US being down about 7pc from a year ago," says USDA livestock analyst Shayle Shagam. "Placements were down about 11pc, which is a fairly sharp decline." Feedlot prices are lower and according to Mr Groseta with grain prices up and fed cattle prices coming down, profits are also in decline. more>>

SFF gets to grips with changes
The meat industry merger plans may be on hold, but Silver Fern Farms is changing how it operates. Its governance structure is up for review. The supply programme is being extended with locked-in future prices, and transport costs will be paid for by the processor. The former PPCS cooperative also intends to market itself as a global food brand. Discussion in the Pareora plant yesterday saw supplier farmers accepting the need for change. Chairman Eion Garden and chief executive Keith Cooper discussed possible governance changes as outlined under the proposed, but failed, partnership with PGG Wrightson. Mr Garden asked for feedback on options such as a smaller board or a mixed board with farmer-elected directors, shareholder-appointed directors and independent directors. Another possible change was a shareholder council. more>>>

Fonterra online auction trade sours
Fonterra's online auction system for whole milk powder has been blamed for wiping 40% off the commodity's price in the past five months. Since the internet-based auction, known as globaldairyTrade, started in July, the price of whole milk powder has dropped from $US4395/tonne to $US2585/tonne. GlobaldairyTrade, which takes place once a month, opens each time with a 15% lower starting price. Fonterra's global trade managLing director Kelvin Wickham said the auction was all about "the international market getting a transparent price" and all globaldairyTrade was doing was "making it more transparent more quickly." Mr Wickham also said the auction platform protected shareholders from being exposed to "huge up and down swings and supply and demand issues and possible international governments intervention or support at a time of volatility". In its Situation and Outlook update, Dairy Australia said buyer activity had decreased in the weeks leading up to the auction. This was because buyers had been using the auction as a new pricing basis for trade outside the online platform. more>>>

Ballance cuts urea price
Fertiliser giant Ballance Agri-Nutrients has slashed the price of its main nitrogen product urea in response to changing global market conditions. The price of urea has dropped 17% to $910 a tonne - saving farmers $190 a tonne - and further price cuts were expected. Ballance chief executive Larry Bilodeau said his company was expected to review its prices on December 1 but urea prices had fallen quickly throughout the world. The new urea price, effective from yesterday, would be further reduced as the company worked through its current inventory. Prices for phosphate-based products such as superten, DAP and Serpentine Super were also under review. However, prices for these products globally had not moved as quickly or as significantly as urea, Mr Bilodeau said. more>>>

Stock carry charged dropped by SFF
SFFs will pay the full cost of livestock cartage for its suppliers in the SI from Dec 1. Keith Cooper said the change would create transparency in the South Island where some companies had been using cartage payments as inducements to supply stock. Mr Cooper said the change would: Ensure best practice management of all livestock transport including assurance of animal welfare standards. Reduce costs as a result of co-ordinated livestock cartage management. Improve supply chains from farm to processing facilities. Reduce the carbon footprint. He said the North Island model was proven, so it was logical to be consistent across the whole country. "Overall it's about efficiencies and cost savings, which translate into better profitability for our supplier partners," he said. more>>>

Underweight bales waste growers money
NZ woolgrowers sending under-weight bales to market are costing their industry more than $1.3 million per annum, says a senior wool industry executive. Malcolm Ching, manager for NZ Wool Services International, says farmers can improve returns for themselves and the whole industry by ensuring all wool bales are sold at or above a viable weight. “An estimated 20% of bales are currently packed and presented for sale too light, around 125kg greasy: 55kg under weight,. resulting in, an extra five bales . The cost of packs , freight ,additional selling costs incurred in handling the wool and then handling charges for scouring or shipping now adds up to a totally unnecessary cost of $265 or around 42.5c/kg, with the overall cost to the industry around $1.3 million. more>>>

Opportunity lies inside market volatility
An ability to manage volatility will determine the success of businesses and industries in these turbulent economic times. Speaking at the recent Irrigation NZ conference in Christchurch, Rabobank senior analyst Hayley Moynihan said uncertainty in the global economy breeds volatility. But it also provides an opportunity for people who manage risk well and adapt to markets quickly. The benefits of sound risk management and market adaptation may not always be in the form of premiums, they just may mean less volatility in the business. She sees the opportunity for this country will be in its ability to lift productivity while keeping costs under control. As a food producer and exporter, this country is well placed to weather the global economic storm, however the market requires food that is affordable and NZ needs to be mindful of this. more>>>

Fatal farm accidents face safety plea
The Dept of Labour is urging farmers to be more concerned with safety as it investigates three fatal crashes on Waitaki Valley farms and a serious accident in South Otago in just over a month.
The department's Otago workplace services manager, Mark Murray, said while unusual statistically to have so many fatal accidents in one area at one time, it was coincidental.Mr Murray said the message of workplace safety needed to be emphasised regularly. Two of the three Waitaki fatalities involved all-terrain vehicles (ATVs) and the third a motorcycle. Mr Murray said there were three areas of safety which needed to be addressed with vehicles: whether they were fit and proper for the purpose for which they were intended, were safety features working and were users trained for the terrain on which the vehicles would be used. more>>>

Fewer lambs to slaughter
Dairy expansion and drought have carved into lamb numbers born this spring, prompting predictions of a $450 million drop in export earnings for the meat industry. M&WNZ has said 4.7 mil fewer lambs were born this year, and with farmers intending to keep more ewe lambs to rebuild breeding flocks, this may mean 6.1 mill fewer lambs will be killed for export. The latest figures come as Silver Fern Farms, reports confidence returning to overseas markets after three weeks of uncertainty, adding to good news in Ballance Agri-Nutrients' announcement of a 17% drop in the urea fertiliser price to $910 a tonne. Further cuts are expected.M&W economist Rob Davison said export lamb numbers would drop by 23%. However, heavier lamb carcass weights this year were expected to help offset the export fall, and rise by 7.5% on last year to 17.7 kg. The ewe lambing percentage fell from 118 to 113%, reflecting drought in many regions. more>>>

China sourcing merino wool direct
Elders Primary wool is facilitating direct supply contracts of fine wool with one of China's largest makers. The company, along with exporter J. S. Brooksbank, recently hosted a senior manager of the Tianyu Wool Industry company from China, who met C.Otago and Mackenzie Basin merino farmers. Elders Primary wool manager Cedric Bayly said Tianyu used about 25,000 tonnes of merino wool a year and it wanted to establish direct supply contracts with NZ growers."China is the largest woollen top producer in the world. To have their top makers banging on our door looking to meet our growers and discuss buying their wool is fantastic." Normally, the Chinese company bought its wool from Australia, but drought and declining volumes prompted it to take up an offer from J. S. Brooksbank to visit NZ. more>>>

Measure genetic data in M&WNZ progeny test
Farmers who make rams or their ram semen available for the 2009 M&WNZ Central Progeny Test will find out how their animals perform relative to other rams in the test. Farm Productivity Research Manager, Dr Andy Bray said individual rams could also appear in the lists of top-ranking rams published each year. The lists identify flock sources so that buyers know where to purchase the best-performing rams genetics that suit their needs. The Central Progeny Test focuses on identifying the best genetics irrespective of breed. A major aim is to create and maintain genetic connections between industry breeding groups that would otherwise be weakly connected. M&WNZ is seeking expressions of interest from breeders whose flocks are recorded by Sheep Improvement Limited (SIL). Both terminal and dual purpose rams are eligible. “In particular we want to improve connections with South Suffolk, Dorset Downs and maternal composite flocks,” says Dr Bray. “We’re also interested in Corriedale flocks using WormFec, and flocks selecting for resistance to Facial Eczema. more>>>

Fonterra cuts back to $6/kgms
Fonterra has cut its 2008/09 payout forecast by 60 cents to $6 a kilogram of milk solids. The reduction follows a 24% drop in international dairy commodity prices in the last eight weeks. But Fonterra said the San Lu debacle was also partially responsible for the magnitude of the payout cut although it did not say by how much .Depending on what happens to international dairy prices, the currency and San Lu's liabilities, the payout may fall further this year. Fonterra Chairman Henry van der Heyden said declining prices across all commodities, including dairy, had been exacerbated in recent weeks by the global financial crisis. "There is a great deal of uncertainty around the world, industry and trade activity is slowing down and all the forecasts are pointing to a global recession," he said. "We have seen a real tightening in consumer spending and dairy is not immune to this rapid deterioration in the global economy. more>>>

Rams bred to survive hill country
The Te Ruanui rams are bred to survive and perform on the East Coast hill country after growing up under some of the toughest hill country in the district. "There is no environment worse than this for sheep and with a 10.5 stocking rate, it certainly sorts them out. Anything that can't make it, is out," says Polled Dorset breeder Craig Brownlie. The rams are all run as one mob on the steep hill country farm on the Gentle Annie at Waerenga-o-Kuri. "For this lot of rams we started out with 380 hoggets and now have about half that to sell. It is natural selection and when they go on to their next home there is a better chance they are going to hack the pace because of the life they have had."Having the bigger flock gives Craig the freedom to cull anything that does not make the grade and continue with the type of sheep they want to breed. Structural soundness is still the top priority in the stud but another area of importance is growth rate."That is a very important trait for a terminal sire." more>>>

Lifting wool returns," a goer "
Wool Partners International (WPI) chair Theresa Gattung has returned from a fact-finding trip to the US ‘fired up’ at the prospect of lifting the market price of NZ strong wools. This can only be achieved by those in the industry working collectively, she says, adding that the WPI strategy to lift wool prices ‘is a goer’. Gattung says she and the three SI woolgrowers who accompanied her on the two-week trip met with all the big carpet manufacturers. ‘We went to test the hypothesis whether we could get a better price for wool the ‘commodity’ and the answer is yes we can. ‘We were also testing whether we could get a premium for the best wool by creating a brand and then partnering with manufacturers to get the best price. Gattung says one of the most interesting discoveries she made on the trip is that the US carpet and rug manufacturers acknowledge NZ strong wool is the best around.‘But we talked to a number of US carpet and rug brands about using NZ wool as a point of difference. Two-thirds of those meetings were extremely positive.’ more>>>

PM - Elect backs farmers to save economy
NZ farmers are global champions at food production and are at the top of the list for economic development,” said PM-Elect, John Key, to Fed Farmers in Wellington. “Mr Key’s speech said farmers are at the core of the new government’s plans to get our economy out of recession. ” said Fed Farmers president, Don Nicolson.“Mr Key’s speech reflected the fact that he has read and digested Fed Farmers manifesto. We look forward to discussing the review of the ETS, reform of the RMA, protection of property rights, infrastructure and animal identification and tracing ." Mr Nicolson said. “Currently the RMA has become skewed towards environmentalism as opposed to the environment. “Fed Farmers welcomed Mr Key’s appointment of Tim Groser as Trade Minister and NZ’s negotiator on climate change. I fully agree with Mr Key that NZ needs to get it right in the second commitment period for Kyoto. Mr Key made it clear his govt will not put NZ farmers out of business ‘just to get a gong from the UN. more>>>

Farmers make submissions on chips in cattle
About 40 farmers have made submissions on the proposed National Animal Identification and Tracing (NAIT) scheme which has proposed electronic chips be used to identify cattle and deer. Ian Corney, independent chairman of the joint industry / govt working group, said there had been a lot of interest in the proposal, and the submissions will help shape the system's design. Meat processors and animal product exporters made 13 submissions, and nearly 50 were from a variety of agricultural organisations and industry associations. Mr Corney last week told critics at a Fed Farmers meat and wool council meeting that the key to the system will be in ensuring strong farmer representation in its governance. Large meat exporters have supported the project, saying that individual traceback is likely to be required by key customers in affluent markets. more>>>

Farmers face big drop in dairy cash
Fonterra will this week make an unscheduled update to its forecast which could cut payouts to farmers by more than $350 million.The next scheduled update was in December but a Fonterra spokesman confirmed there would be an announcement on Friday. Company policy is to make public adjustments when forecasts change by at least 30c. Based on last season's collection of 1.19 billion kg of milksolids, which was down 4.3 per cent because of the drought, a cut of 30c in the forecast could cost farmers $357 million.The National Bank expected the payout to be below $6 by the end of the season. "But the thing also to stress is that a $6 payout on an historical basis is still a very good result," Wilson said. more>>>

Income the pits at $20,000
The messages from either side of the farmgate are the same - NZ's red meat producers are in big trouble, with gross farm incomes this year expected to average just $20,000.And it is all down to long, complex supply chains to market that add costs at every step, yet fail to capture any substantial retail margin for the farmer. This year the best farmers in the world will produce 12% more lamb from 31% fewer sheep since deregulation of the NZ farming industry. They have radically redesigned their farm systems for maximum efficiency since 1985 – yet the margin for those added efficiencies goes to the retailer, not the producer. Mistrust and poor direction have stricken the meat industry, says sheep and beef farmer and 2008 Nuffield Scholar James Parsons. He advocates a ‘collaborative value chain’ in which the producers’ group, processor and retailer all overlap and share information for maximum supply chain efficiency. more>>>

Long term contracts buoy farmers
Wairarapa sheep farmers are already selling next year's lambs at set prices giving economic certainty even as forecasts for the dairy payout 2009 continue to fall. Fed Farmers Wairarapa chairman Anders Crofoot said lambs have historically been sold at set prices on the spot market a week or a couple of months in advance. Now lamb companies including Silver Fern Farms and Wrightson are approaching farmers and "trying to get contracts going up to 12 months". Mr Crofoot said there was room in the contracts if farmers found themselves unable to supply. Lamb prices are still above $5 a kilogram after peaking about $5.50, but beef has suffered a recent drop in price. The move towards long-term contracts is sparked in part by a shortage of lamb. European supermarkets have historically been reluctant to agree to long-term contracts, but Mr Crofoot believes "everybody is realising there's going to be a huge shortfall of product". more>>>

Farmers to tighten their belts
The time of milk and honey could be over for the south as the global credit crunch brings lower commodity prices and a warning to banks to curb their enthusiasm for the dairy sector."The Reserve Bank considers that agricultural lending has become a riskier component of bank balance sheets, that should be managed carefully," the report says. National Bank chief economist Cameron Bagrie said the turmoil in the international markets was hitting dairying particularly hard. He expected payouts to "have a five in front of it" rather than their current $6.60 mark."Banks will curb their lending, you're in a completely different economic environment at the moment, there's a lot of uncertainty around the globe and you're seeing a lot of pressure on commodity prices and dairy prices are leading the charge," he said. more>>>

Boost brassica yield
Applying nitrogen just before spraying off pasture could boost subsequent brassica yields in summer dry regions, work by AgResearch shows. However, eliminating volunteer grass and targeting longer season brassicas appears to be the key.‘It worked on the swede crop but didn’t work with turnips,’ says AgResearch’s David Stevens, who presented a paper on two trials in East Otago at the recent NZ Grassland Conference in Blenheim. November sown swedes produced an extra 17kgDM/kg of N applied in early spring before spraying out pasture with glyphosate. A mixed crop of turnips and kale showed small responses in March but by July, control plots, which only had 16kg of N at sowing, were on a par with high N fertiliser plots. The hypothesis behind the trial was to increase soil available nitrogen before the brassica’s growing season because in such summer dry areas later applications are often not mobilised until well into autumn. more>>>

Alliance's financial result
Alliance last week announced operating profit before distributions to shareholders of $67.9 million on turnover of $1.3 billion for the year ended September 30. Operating surplus after tax and before pool surplus payments for the year was $54.0m, from $10.9m in 2007. The board approved a pool surplus distribution of $20.5m and dividend of 5c per share with a full imputation credit. The combined pool surplus and dividend distribution to shareholders is $23.3m. The pool surplus will be paid on November 21 and the dividend on December 19. A bonus share issue will be made in December 2009. Alliance chairman Owen Poole says the result is pleasing and brings the net profit before distributions over the past five years to $152.2m, $99.3m of which has been distributed to shareholders. ‘For a fully paid average shareholder, this amounts to more than $4.00 per lamb above schedule for every lamb supplied over that period’. more>>>

Poorly conceived 'green' ideas will leave us in the red
The Herald does a great job in canvassing sustainability and climate change issues through its pages. But some of the policies that the green movement advocates and recent "green" legislation may well prove to be negative rather than positive. Many of the ideas also completely ignore the UNs' call for a doubling of world food production over the next 20 years. At present NZ farmers produce food for 53 million people. In NZ those who label themselves "green" seem to believe that they have all the answers, and that the rest of us should come into line. Many push organic farming and the use of biofuels in preference to fossil fuels. Many are against trade, and urge us to eat food that is locally produced. The use of biotechnology in agriculture is strongly opposed. Some biofuel production may have potential. But producing biofuels from areas suitable for producing food does not stack up either environmentally or economically. In recent months even the all-powerful EU has stepped back from strongly promoting such production. more>>>

5 finalists for Lincoln Uni farmer of year
Five finalists from Canterbury, North Otago and Southland are in the running for this year's South Island Lincoln University Foundation Farmer of the Year award. This year's competition category "Meat Production", brings a prize for the winner of $15,000 for travel and a runner-up a prize of $7500. This year's five finalists are a mixture of beef and/or sheep farmers,from coastal Catlins to the plains of Southland, to both dry and irrigated hill country in North Otago and Canterbury. They are Richard and Jane Maxwell. The Maxwells farm Friesian bulls on their 670ha of dry hills near Cheviot in North Canterbury. Colin and Stefan Mavor. The father and son team farm sheep and steer calves on 285ha and lease another 350ha at Roseberry in North Otago. Adrian and Anne Lawson. The Lawsons farm sheep on 163ha on Morton Mains on the Southland Plains. Tim and Sara Coop. The Coops farm sheep and beef on 1650ha of dry hills at Port Levy, Banks Peninsula. Cameron and Michelle Clark. The Clarks farm sheep and beef on 400ha (320ha effective) at Purakuiti in the Catlins. more>>>

Rural property values heading for correction
Rural land values around NZ are heading for a correction but land is still a good investment, says First National Real Estate's leading rural valuer. Errol Saunders, managing director of Ford Baker Valuation, addressed rural real estate agents at First National's annual South Island Rural Seminar in Christchurch yesterday, giving an overview of trends in values of dairy, arable and finishing properties. Prices had stabilised and sales volumes had slowed dramatically over the past year, pointing to the likelihood of a downward correction over the next 12 months, Mr Saunders said. "We now have a low volume market. Buyers are just taking stock and hesitating. A rural contraction of 10% would not surprise me. Prices for dairy land had peaked in Mid Canterbury at around $55,000 per ha last season but this year should realise $40,000-$50,000 per ha. Grazing farm values were stable, with the price per stock unit at $600 - $800. more>>>

Permit to farm leaves Taupo farmers gutted
Farmers today said they were completely gutted by an Environment Court decision that will require Taupo farmers to seek a permit to farm. Environment spokesman for Fed, Lachlan McKenzie said it is like needing a permit to dig a vegetable garden. "This decision means all farmers in the Taupo area will need planning permission just to farm. This turns on its head the fundamental human right to grow food," Mr McKenzie said. "Clearly the Resource Management Act has become so skewed towards environmentalism the Act's purpose of sustainable management has been lost sight of. Sustainability of course includes economic, social and cultural aspects as well as the environmental side."I am deeply concerned the decision will set a precedent for other parts of the country without just cause. "This is a test for the new government. They must prove they back economic development or we will see the economy backbone contract at the very time it needs to expand," said Mr McKenzie. more>>>

Royal prescence for royal show
Princess Anne is due to arrive in Christchurch on Friday to present awards at the Royal Show which starts today. She will present the award for the Royal Agricultural Society supreme champion animal on Friday afternoon. The Royal Show is expected to attract over 115,000 people, and features more than 7000 livestock. Princess Anne is representing her father, the Duke of Edinburgh, at the 23rd Commonwealth Agricultural Conference. It is her first NZ visit since June 2006. She will visit the shearing pavilion to meet champion shearers celebrating 50 years of shearing at the show, and make a short visit to the "city farmyard". On Saturday she will present the New Zealand Cup at Riccarton – the first time a royal has attended the race meeting since 1963. more>>>

High spot prices likely to deter contract takers
The last time NZ had a 20 million export lamb kill, all of the meat company executives and most of the sheep farmers weren't even born. The NZ sheepmeats sector is going into uncharted territory and meat companies will have no option but to fight tooth and claw for throughput. But farmers are not convinced by contracts when spot prices are high and rising.The meat companies are geared up for the fight, having banked excellent profits from large kills and rising world meat and by-product prices in 2007-08."We have all got customers we need to service, so there is real potential for a procurement war," said Stuart Weston, AFFCO chief executive.Weston takes heart that the NI sheep flock is expected to bounce back after the 2007 drought, whereas the SI's reduction in ewe numbers is an "enduring change". Meat companies will also have to factor in a mutton kill chopped in half. Also unfortunately, ewe hogget numbers fell by 16% to 9.4 million, with all regions having decreases except the East Coast. more>>>

Conversions slows as meat prices & dairy costs rise
The rate at which farmers have been changing from sheep farming to dairying appears to be slowing.The prospect of improved sheep and beef returns and rising construction costs have led to planned dairy conversions being cancelled, although exact numbers are hard to confirm. Planned conversions in Canterbury and Southland have been cancelled, the result of building costs for dairy units having risen from $120,000 to $150,000 over the past year, making the price of existing dairy farms comparable with the cost of converting. PGGW Southland rural real estate manager Andrew Patterson said there were now 2-3 the number of dairy farms on the market than at the same time last year, with many vendors owners of several farms choosing to reduce their workload by selling one.Mr Patterson said prospects of improved returns for lamb, beef and venison, higher conversion costs and a lower milk price had made converting less viable. more>>>

Global crisis will affect farmers
There will be winners and losers from the present global credit crisis.But how it impacts on farmers will depend more on the strength of their balance sheet and less on external factors such as the exchange rate or the dairy payout, Rabobank NZ general manager Ben Russell said. Mr Russell told about 200 southern dairy farmers at the launch of the global dairy report in Invercargill last Wednesday that the current credit crisis was the worst since the Great Depression of the early 1920s.Mr Russell said there would be "far fewer" farm sales and farmers who relied on achieving capital gains in land would be disappointed as moderate price drops were expected. "You don't want to be in the business of selling property," he said. However, farmers with strong balance sheets would have an opportunity to grow their business, he said. "There will be weaker sellers out there," he said.Mr Russell said Rabobank — which has 23% of the NZ sheep and beef debt market and a substantial slice of the dairy market — was actively looking for new business. "We will lend to well capitalised farmers that are good managers, but that doesn't mean we won't do tight deals. But we want farmers who can service their interest," he said.
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Feedback sought for draft sheep & beef welfare code
Minimum standards of animal welfare and recommended best practices for anyone responsible for sheep and beef cattle are outlined in a new draft code of welfare to be released for consultation by the NAWAC tomorrow. The code is intended to encourage all those responsible for the welfare of sheep and beef cattle to exceed the minimum standards and adopt the best industry practices of husbandry, care and handling. The draft code covers all sheep and beef cattle farmed mainly for their meat, fibre and/or their offspring. Sheep and cattle of recognised dairy breeds are covered if they are weaned and farmed for meat production. Proposed minimum standards cover all aspects of sheep and beef cattle husbandry, including stockmanship, handling, breeding and the provision of food, water, shade, shelter and housing. Requirements around shearing, protection from flystrike, the use of feed pads and selection for transport are also addressed. more>>>

Fonterra runs into problems with farmers
Fonterra directors have flip-flopped on the coop's controversial capital restructuring and their advocacy for floating shares in an operational arm. "The board will investigate options that would see Fonterra remain a fully integrated farmer-owned co-operative," Shareholders' Council chairman Blue Read said. Fonterra is in the middle of a major bid to rejig its capital structure, but has run into problems with farmers who do not like its preferred option of floating the shares of an operational subsidiary. "Despite considerable initiatives to outline Fonterra's strategy, there remains a lack of buy-in among farmers," the council said today.But Mr Read said today the council is worried that the gutted investment in China and the debacle over changes to the cooperative's capital structure may erode farmer confidence in its governance and future direction. more>>>

5900% rent rise if farm not sold
The lessees of St James Station in North Canterbury faced a 5900% increase in rent should they have opted not to sell the property to the Crown. Figures requested from Linz revealed the authority proposed to increase rent on the 23,783ha property from $6750 a year to $400,725 a year, after an 11-year review. The change in value was due to a new rent-setting methodology and an increase in land values. Sources said the old rent was based on the value of land exclusive of improvements (LEI), of $300,000. The new LEI value was $17.8 million and included amenity values and land in its natural state. Based on 16,000 stock units, the rent has increased from $19 a stock unit to $1100 a stock unit. St James ran mostly cattle and horses. The Stevenson family last month sold the historic property to the Nature Heritage Fund for $40 million, but they told farmer representative groups that the threat of a nearly 6000% increase in rent was not the reason they sold. more>>>

New era dawns in global dairy market
The global dairy market has entered a new era with growing world consumption of dairy products, combined with reducing growth in supply, expected to underpin sustained higher, though volatile, prices into the future, according to a recently-released industry report. The report by leading agribusiness lender Rabobank, says despite current short-term challenges facing the sector – including a recent moderation in dairy commodity prices – the medium to longterm outlook is robust, with the market for dairy moving into a fundamentally changed era.“In this new era, global demand for milk at any price point has shifted upwards, based on income growth in many parts of the world, and favourable demographic and cultural trends that have increased the number of people that are aware of dairy, have access to dairy, want to consume it and can afford to do so,” the report says. “Rabobank remains convinced that the medium-term equilibrium price for dairy products has shifted upwards from its long-term average. Economic growth and cultural changes have substantially increased the price the market will pay for milk.” more>>>

Fed Farmers find flaws in report
A Fed Farmers peer review of a report that claimed dairy farmers were getting away with pollution has found it poorly written, with unsupported assumptions that were negatively "spun".However, the federation leaves itself open to criticism by using as peer reviewers two staff members.The report they have reviewed was released last month by Fish & Game and Forest & Bird. It looked at progress since the dairy industry’s 2003 Clean Streams Accord. The writers, Fish & Game’s Neil Deans and Forest & Bird’s Kevin Hackwell, found that water quality in dairy farming areas had continued to fall since the accord was signed by Fonterra and central and local government.Fed Farmers instituted a peer review, saying it would take a dispassionate look at the report,and 5 weeks later, have concluded that the report was ‘‘poorly constructed and written as a campaign tool’’. They say Deans and Hackwell made ‘‘a number of unfounded suppositions and reach conclusions unsupported by the source data. Worse, the data, in places, is ‘spun’ to support a negative conclusion when the actual data is either neutral or positive’’. more>>>

Home under the ranges
When the kowhai trees flower, Otaki deer farmers the Croads have to take cover from low-flying feathered wood pigoens. The fat birds are joined by big flocks of tui and bellbirds in descending on the garden from the nearby Tararua forest park in search of food and shelter. The birdsong is disturbingly raucous. They have been farming on the slopes of the Tararua Range behind Otaki for 30 years but the birdlife has only appeared in such numbers in recent years. Errol traces the change to the rejuvenation of the park's native bush after an intensive possum-killing campaign. The reason for the possum cull was a tuberculosis outbreak in his deer herd. It changed Mr Croad's life, "It knocks you financially and emotionally and leaves you questioning your abilities as a farmer."As a longtime deer hunter he supported the Deerstalkers Association's belief that 1080 was unacceptable; that it killed not only possums but all bird and animal life. But he wanted the possums and ferrets – carriers of the Tb that had devastated his farm – gone. "It was the best thing that could have happened," he says. "It zeroed the possums and killed all the ferrets and wild cats. The bush regrowth has been amazing and the bird life has exploded." He is now a firm supporter of 1080. more>>>

French retailer, SFF seal contract
SFFs-labelled lamb will be displayed in the chiller cabinets of nearly 1400 Intermache supermarkets in France this season, in what the meat company says is a NZ first. The Dunedin meat co-operative hosted a delegation of French supermarket owners, importers and buyers this week as it cemented a contract which would also see NZ farmers encouraged to supply 18kg to 21kg lambs for this specific market, part of Silver Fern Farm's Backbone procurement programme. The out-of-season New Zealand-sourced lamb would be of a similar size to French lamb. Mr Lachaux said consumers wanted assurance that food they bought was of a consistent quality, safe, free of disease and hormones and supplied when it was required from January to June. NZers did not appreciate their country's high reputation in France, including the aura that surrounded the All Blacks,There was a connection between our national rugby team, the silver fern emblazoned on the black jersey and the SFF brand, he said. more>>>

Velvet prices favour the patient and the firm
Farmers are advised to be patient and disciplined when negotiating sale prices for their deer antler velvet. "Farmers accepting $55-60 a kilo from road buyers are doing themselves, other deer farmers and overseas customers, no favours at all," says Velexco general manager Ross Chambers. "Current market prices are 20-30% above that level. But they will be sustained only if the product is released gradually onto the market by strong sellers." He says forward buying power has waned and now gone from the spot velvet market entirely. Farmers, he says, need to adapt to this new reality and be stronger sellers. Mr Chambers says the velvet market is not immune to world economic events and foreign exchange rates remain unstable. NZ production is expected to decline 420 tonnes this season and this has been noted by buyers. Velexco is also hearing anecdotal reports from China that velveting herds there are being slaughtered because of dramatic increases in feed costs," he says. "For these reasons, farmers should be looking for better prices this season than last. But they will only achieve them if they sell their velvet through someone who is willing to phase the release of the product onto the market over several months. more>>>

Bid to boost biosecurity
The level of pest incursions at NZ’s border is unsustainable and threatens NZ’s competitive agricultural advantage, National biosecurity spokesman Shane Ardern says. ‘A National government would introduce a range of measures to ensure this does not happen.‘I’d put some horsepower behind some of those ideas to reduce the number of biosecurity-risk items entering NZ. ‘There’s no doubt we need stronger border controls, and National will make changes to do that.’ He says 333 new organisms have been found in NZ over the past five years, and the number of biosecurity-risk items entering our borders topped 157,467 last year.
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Fonterra moves to cut cash and protect debt
Fonterra has announced it will stop its farmer owners who want to become contract suppliers from selling shares back to the dairy cooperative because it wants to preserve cash amid the global Credit Crunch. Chairman van der Heyden said the changes to the terms of contract milk supply for next season were “necessary and recognise the absolute priority the Fonterra Board places on protecting the interests of our farmer-shareholders, who make up 96% of our supply base”. Fonterra said it would require all milk to be fully share-backed within three seasons, which require farmers to hold shares equivalent to their milk supply and for any increases in their production over time. The contract price for the current season is 2 cents below the Milk Price.more>>>

New DNA test for facial excema
NZ’s leading DNA animal testing service, Genomnz™, a service of AgResearch, is about to launch a DNA testing service for facial eczema that could save the dairy industry millions of dollars per year. This DNA marker test, which can be applied to Holstein-Friesian or Jersey cattle will include microsatellite markers for both profiling and parentage testing as well as genetic markers that can estimate facial eczema resistance or susceptibility. Dr Chris Morris says FE resistance or susceptibility is a heritable trait, which can be a serious animal health problem for dairy cattle, in NZ. The disease occurs mainly in the upper NI and in Gisborne and Taranaki, but in years with serious outbreaks it can be much more widespread. In susceptible cows, sporidesmin causes liver injury, with deleterious effects on milk production and survival in the herd.The DNA marker test now available could save up to $39 million of the total costs of FE in a serious-outbreak year, if all FE-prone herds were protected genetically. more>>>

Solidiers syndicate wins case against crown
A group of Maniototo high-country farmers, known as the Soldiers' Syndicate, have won the war to keep farming their pastoral lease properties in the Hawkdun and Ida Ranges. Last week a High Court judgment ruled against the Crown after it reneged on a deal to offer a special lease to the syndicate.In 2003 the Commissioner of Crown lands (CCL) decided to grant a special lease on the expiry of a pastoral occupation licence to the Soldiers' Syndicate. However, late last year CCL told the group that it had changed its mind and wanted to designate the land, comprising 4400ha in the Hawkdun and Ida ranges, as a conservation area.Fed Farmers high-country chairman Donald Aubrey said the Soldiers' Syndicate ruling could set a precedent for the Minaret Station test case, which had been heard over the past two weeks. more>>>

The meat industry need to ditch the secrecy
Most will have read the SFF BackBone options and there's lots to think about. Mostly the thinking is about pricing on the contracts and if management systems can be put in place to actually turn them into profit. I have to say it's great to see contracts offering annual programmes, which push the supply boundaries and weights of lambs. Farmers should look at these options because they are a commitment to the long-term future of the industry. This is how the industry needs to be operating.The only bit missing in the colourful brochure was the most important bit - the price. The response. "Sorry can't tell you, you are not a supplier and even if you were a supplier the information would be for you alone." We need a structure that will allow development of sheep farming systems in a co-operative and rationally planned NZ wide context. We don't need secretiveness and suspicion and hidden agendas. more>>>

Deals off so hunt for other options
Meat processor SFFs has terminated a partnership agreement with PGG W, leaving the way open for alternatives to reinvigorate the red-meat industry.However, the two parties remain in talks about a new deal. SFF has also floated the idea that rival Alliance Group and/or other meat processors might again be willing to examine how industry aggregation can be achieved. SFF said PGGW's failure to pay the first instalment of $145 million on October 1 or deliver a new settlement date, had left it with no alternative but to terminate the agreement relating to the proposal. Keith Cooper said "We couldn't keep staff, we couldn't keep shareholders in limbo for any longer given the fact PGGW couldn't deliver a date when they would be able to settle, or raise the equity." SFF had not determined the amount or form of compensation it would seek to recover from PGGW. more>>>

Effluent breaches costly: ORC
Susie McKeague's sympathies are genuine when she talks about the impact on dairy farmers being convicted for illegal dairy effluent discharge. But some dairy farmers had not listened to warnings and advice, and had ignored the Otago Regional Council's carrot-instead-of-stick approach.The council's farm infrastructure wish list included:• Sealed effluent storage ponds able to hold three months worth of effluent.• A travelling irrigator that applied 3mm to 4mm per application with area of up to 8ha per 100 cows.• Waterways with buffer zones up to 3m wide, depending on the slope,and stream crossings to have culverts with bunds to stop effluent washing over the side.• Buffer zone on lanes adjacent to a waterway and drainage from the dairy shed yard fed into effluent storage.Buffer zone of up to 5m for greenfeed crops which are beside a waterway and a standoff area for cows when exceptionally wet.• Liquid storage capacity for drainage from standoff pads and silage pits and careful placement of silage and offal pits in areas with a high ground water table. • Nutrient budgeting to take account of effluent irrigation. more>>>

Conference warned of threat to dairy industry
Speakers at the Horizons Livestock Sciences Conference left no doubt that Dairy will remain one of the fastest growing industries in NZ, but one speaker warned that the global dairy industry would eventually face some fierce competition from soybean. Addressing the question of “Value vs Volume”, Dr John Penno of Synlait, said soy as a protein substitute would influence the dairy industry in the future, unless the industry could find ways to transform the value of its product. “Soy can be produced much more efficiently on scales we can’t even comprehend, and as soy products are being developed to more resemble dairy products, there is a danger that it can become a substitute for most dairy products.”Dr Penno says NZ’s dairy industry will have to find ways that can meaningful differentiate its products from others on the international markets. “This is a 20 year strategy. We need to exploit the bundle of benefits that is uniquely NZ– things that we take for granted like a healthy environment, healthy lifestyles and healthy and safe food. All of these attributes have to be wrapped up in real products with substance,” he says. He says there is a challenge ahead for scientists working on adding value to dairy food products. more>>>

SFF profit exceeds expectations
SFFs is back in the black, the meat company reporting a $51.2 mill net profit for the last financial year, a $120mill turn-around in its accounts. Chair Eoin Garden attributed the result to higher livestock throughput with associated efficiencies and improving markets but warned profits would return to "realistic levels" this year.Mr Garden said SFF reduced debt by $91 mill, from $329.5 mill to $238.6 mill and attributed that to a tight rein on inventory, improved margins, disposal of non-core assets and the issue of supplier investment shares.It also implemented Project Rightsize at a cost of $25.3 mill, primarily in redundancy payments related to the closure or part closure of six operational sites and five lamb processing chains. Shareholder's equity rose from 35% to $40%. SFF paid $11.5 million in rebates based on animals supplied and a cash dividend of 10c for each fully paid supplier investment share held. Looking ahead, Mr Cooper expected farmers to enjoy higher prices due to a more favourable exchange rate, but tighter margins should see SFF return to more normal profits. A large number of breeding ewes were killed last year, so fewer lambs would be processed this year. more>>>

Wool network winds up
The Wool Industry Network, announced today that while the development of WIN’s initiative will continue, its operational activities have been wound up. Established in 2006, the Network was set up with a mandate to improve the economic return of wool to NZ. Over the past two years it has worked closely with all sectors of the industry to ascertain the key issues and to develop and implement a wool sector strategy to bring about change. Wool Industry Chairman, Sue Sheldon says, “The work of the Network is now all but complete. It was established to come up with a solution to improve returns on strong wool. We have developed and released the strategy that we believe will achieve this and have put in place Wool Grower Holdings and Wool Partners International as the two key initiatives to drive the industry change.” “WIN CEO Mike Jones has joined Wool Partners International as GM– Commercial and this continuity will be valuable in ensuring the transition from strategy to implementation.” more>>>

National's agriculture policy
Farmers should find favour with most of National’s promises in its recently released agricultural policy and the party is also confident its push for an emissions trading scheme (ETS) won’t bleed rural support. Agriculture spokesman David Carter and leader John Key were in Hastings late last week to outline the party’s pledges to the rural electorate. The policy includes: •Rejigging the detested RMA to ‘cut costs, confusion and delays’ to primary sector expansion. •Supporting private property rights over access issues. •Strong backing for the continued public funding of agricultural R&D, on par with the Government’s Fast Forward fund. •A major investment in rural broadband. •Continued support of rural schools and education. more>>>

Fears but NZ prices holding
The world is headed towards a recession which many fear could ankle-tap a recovery in some of our key farm commodities. While the future may be rocky, so far our key exports are showing some resilience. The financial meltdown could slash demand for beef and lamb by up to 15% in the coming year, but a shortage of lamb and the plummeting exchange rate could negate any financial impact on farmers. M&WNZ economist Con Williams said there were already signs the financial crisis was forcing more people to eat at home rather than in restaurants. Australian wool prices last week plummeted to record lows as tight credit conditions meant buyers could not open letters of credit. Tighter financial conditions could see demand fall for beef and lamb by up to 15%, and while that would affect prices, he could not say by how much. more>>>

Push for affordable rural broadband
Affordable broadband could soon be offered in the rural Waikato after Wintec joined the region's councils to investigate which areas are poorly served. Environment Waikato, and the region's district councils, have put $1000 each into the Whole of Waikato Regional Broadband Governance Group, which says affordable broadband is as important as power, water, and sewerage. The group is investigating what level of service is available across the region and plans to make a case to the Government's Broadband Initiative Fund in June for cash. National said it would axe the fund if it won the general election on November 8. However, it has promised to spend $1.5 billion on a half-share of a fibre optic network that would connect 75% of NZ households and businesses to broadband in the 22 biggest cities by 2015. Otorohanga mayor Dale Williams, said the existing service was slow, and outlying parts of the district could not get it except via satellite at about $600 per month. "For a struggling sheep and beef farmer that's just not an option," Mr Williams said. more>>>

Opuha project wins supreme enviro award
Ten years after legal battles following the collapse of the Opuha Dam, the environmental benefits of the project have been recognised. Yesterday, the dam gained the Supreme Canterbury Resource Management Award, which was presented by Environment Canterbury. The dam irrigates large areas of South Canterbury, generates electricity and maintains summer and spawning flows in the Opuha and Opihi rivers. The awards are administered by Ecan, which ironically was the regional council to push for prosecutions after the dam was breached during construction. The panel of judges said the project contributed to sustainable resource management and helped the community's social and economic well-being. Dam pioneer and former Sth Canterbury Farmers' Irrigation Society chair Tom Henderson said both the farmers in the scheme and environmental groups had learnt a lot over 10 years. In the past there had been concerns about the environmental effects of the dam, but now benefits could be proven. Fish and Game had recognised the improvement in angling brought about the scheme. more>>>

No cash for Silver Fern Farms
PGG Wrightson was still struggling to find the capital needed to progress the merger with SFFs, chairman Craig Norgate said yesterday. Mr Norgate said he was unsure when his company would hand over the first instalment of $145 million for a 50% share in SFFs after it missed the Oct 1 deadline. "The financial markets need to settle down first. We can give no certainty at the moment." PGGW had the month of October to settle after SFFs' shareholders voted in favour of the partnership, but it now appears increasingly likely that deadline will be pushed out even further. The $220 million cash injection, the balance of which was payable in the first quarter of next year, would be used to reduce SFFs' debt, allow the company to develop new markets and to invest in new technology, such as robotics at its Finegand plant near Balclutha, at a faster pace. Raising capital in the current financial environment was proving extremely difficult, Mr Norgate said. "We're working our way through it, but it's not easy." However, Mr Norgate, who was expected to update his shareholders at PGGW's annual meeting in Christchurch today, said both parties were still committed to the partnership. more>>>

Digital irrigation needed
A simple computer programme to help schedule irrigation on dairy farms could soon be available and judging by the findings of an AgResearch survey, it is badly needed. The Irrigation Calculator has been developed with Dairy Insight and Dairy NZ funding by scientists at Crop & Food and AgResearch.It is designed to help farmers decide when to irrigate, how much water to apply, and the consequences of wrong irrigation timings or amounts, says Dick Martin. Responses to an AgResearch survey* from over 200 dairy farms in Canterbury found only 21% measuring soil moisture, 12% using a scheduling service, and 6% doing water budgets. Monitoring of 10 irrigated dairy farms found only three or four producing close to the maximum potential drymatter, while the remainder had ‘about half as much grass as the best producing farms.’In his experience, Martin says poor pasture management is unlikely to be the major cause of that production loss, but under-irrigation could well be, and where farms are over-irrigating they are wasting energy, water, and possibly leaching nutrients. more>>>

Dams not cycle lanes
Fed Farmers President, Don Nicolson today urged all political parties to focus far more on the productive sector. He said if government increased infrastructure expenditure it should spend money on building dams rather than cycle lanes. Several political leaders , said that given the current international financial crisis, the Govt should spend more money on infrastructure as a way to stimulate the economy. "It's not complex - dams store water, cycle lanes don't. Water grows grass and grass produces food which we can sell to the world to pay the nation's bills. "If we have a strategy that can harness NZ's enormous water resources so we get water in the right place at the right time, our world-beating farmers will be able to convert more grass into food and fibre for more export receipts. If we are going to survive this economic crisis NZ needs to produce more primary sector exports to pay the bills."While building new houses, new classrooms and new cycle lanes may be helpful for some, it's not going to increase exports to set NZ up for greater success. more>>>

The dilemma of farming the hill country
Graham and Shelly White share a dilemma facing many middle-aged Kiwi couples on large, specialised sheep farming properties today. The Whites farm Willow-lea, a 600ha property on rolling Otago hill country at Hindon, between the Taieri and Strath Taieri Plains. Their farm ranges between 1100ft and 1500ft (330 to 460m) in altitude, which makes it unforgiving in winter and drought-prone in summer. They run 3500 Perendale ewes and depend on their wool and lamb cheques for their economic survival. The Perendale breed is hardy and suits the region, bouncing back quickly from tough winters and dry summers. The Whites pride themselves on a low-cost, low-input operation. They are very conscious of cutting costs to a minimum and don’t drench or inoculate their stock at all.As Graham explains, the dilemma facing the majority of the country’s sheep farmers is that they are making a 1.5-2% return on their investment. That’s why a lot of their peers are leaving the industry.The global financial crisis has compounded the problem and may be the last straw that puts many debt-loaded farmers out of business. more>>>

Fertiiliser price slumps
The cost of fertiliser has collapsed by more than $500 in the last three months. By the end of the year, farmers in Australia should be able to purchase urea at one-third of the current price. In July, urea was trading for a record US$900 a tonne. Steven Mitchell, from commodity forecaster ICIS, says prices in Australia will take a while to adjust. "It's a question very much of how the distributor handles it," he says. "If they want to average the price between the high prices imports in July and August and the low priced imports from November, they could give an averaged price straight away between US$300 and US$350 FOB, plus ocean freight of US$40 a tonne. "So there ought to be some much cheaper fertiliser available in the country from the turn of the year onwards." more>>>

Greens want 15% NZ organic by 2015
The Green Party today launched an agricultural policy which calls for 15 per cent of the nation's farms to be going organic by 2015, and for half of farm production to be organic by 2020. Party co-leader Jeanette Fitzsimmons told the crowd at the Hastings Agricultural and Pastoral Show – where the National Party released its agricultural policy yesterday – that an essential part of the strategy was keeping NZ farming GE free. "It's vital we retain and build on our international reputation as a clean, green country as this underpins our export industry," she said. Organic farming had received only sporadic support, but could provide a model for sustainable systems to protect soil and water resources. State-owned farmer Landcorp should be used to model sustainable farming techniques such as organic production, retiring riparian areas and areas of high erosion, conserving biodiversity, and reducing synthetic fertiliser use, she said. more>>>

Genetics genius's legacy lives on
Peter Wishart's legacy will live on in the Wishart gene, according to the southern stud breeding industry. The leading romney stud breeder died suddenly on his farm at Tussock Creek, near Winton, last Monday from a suspected heart attack. He was 51. Mr Wishart was described by southern farmers and the scientific community as an innovative forward thinker who pushed the boundaries of production in the romney breed. AgResearch Invermay scientist Dr George Davis recalled a man with an "incredible" memory for figures and tag numbers. The pair, who had worked together for the past eight years, were believed to be on the cusp of finding a gene marker for a prolificacy gene, which had been identified in Mr Wishart's flock. In the 1990s Mr Wishart discovered one of his ewes had bred triplets every year for the past seven years. Further investigations revealed that one copy of the Wishart gene would produce another 40 lambs per 100 ewes or a 40% lift in ewe lambing percentage. more>>>

Doing things the Latin way
The Latin way sounds as if it should be one of those long straight roads the ancient Romans were famous for. And it is a kind of road, explains Lincoln University agribusiness professor Keith Woodford, but a tortuously winding one.Professor Woodford, who has travelled widely through South America and studied its farming systems, sees many opportunities for NZ farmers in Uruguay, Chile and Brazil, but less in Argentina. However, he sounds a note of caution. "The jury's still out on whether going there will be worthwhile." One of the traps for the unwary was the Latin way. Asked to explain this, he found it difficult to put into words. "It is not code for corruption, that's definite. It is subtle and is only recognised when things go wrong." There was the social aspect. "South Americans like to spend more time than we would building a social relationship alongside their business transactions." Latin people tended to be less direct. They would sometimes, out of politeness, not express disagreement, but just not follow through on the action that Kiwis expected. more>>>

Incentives for vets in rural practice welcolme
National’s proposals to address the rural veterinary shortages - including a voluntary bonding scheme for rural veterinarians - has been welcomed by the veterinary profession.NZVA chief executive, Julie Hood, says the proposals will greatly assist the severe shortage of veterinarians in rural areas.“This is a serious issue, not only for the profession, but for the viability of our agricultural exports, the welfare of our animals and our biosecurity surveillance systems.” Ms Hood says the NZVA would not normally comment on political policies, but this particular policy proposal is an important step towards attracting and retaining young veterinary graduates into hard to service areas. She says in areas like the east coast of the North Island, where there is now no veterinary presence for some distance, animal welfare is a growing concern. “Veterinarians play an important role in maintaining welfare standards and also in animal disease surveillance. When dealing effectively with foot and mouth disease, for example, early detection is extremely important.” more>>>

High country land prices driven by Government
The Govt is driving up the price of high-country land by paying above market rates for whole property purchases as it fulfills its conservation and high country park goals. In the case of the recently purchased St James Station in North Canterbury, the Nature Heritage Fund paid $40 million, or $2500 a stock unit - four times its productive value as measured by comparable sales of high-country farms for pastoral use. The Govt denies it has paid excessive prices, increasing land values and therefore rents paid by lessees, saying that on a per-hectare basis it was paying market rates. Farms are bought and sold on a per stock unit basis, and using that measure, sale figures obtained by the ODT for recent sales of high-country farms, show that whole property purchases by the Govt of St James, Birchwood, Landsborough, Twinburn and Tambrae stations all exceeded comparable prices for land remaining in pasturage.The Govt has bought those properties outright, paying from $960 to $2500 a stock unit, or $420 to $1694 a ha. In the last two years, prices paid for pastoral lease high-country farms have ranged from $524 to $963 a stock unit. more>>>

Winning genetics
A new genetic technology for the dairy industry is proving popular with 800,000 inseminations projected in the first year. Livestock Improvement says its initial estimate of 300,000 inseminations in the first year has proven to be conservative. The cooperative says farmers are embracing the new DNA Proven technology which has the ability to identify elite artificial breeding sires from their DNA rather than conventional daughter proving. The company has also launched the technology to farmers in UK and Ireland. LIC chief executive Mark Dewdney says the technology will continue to improve and it expects to be able to increase the number of gene types from the current 50,000 level to hundreds or thousands, extending the predictive ability even further. ‘The heart off our core purpose is to genetically improve our customers’ animals, and DNA Proven will drive that at rates never before possible,’ he told the LIC annual meeting in Hamilton this month. more>>>

NIAT forced to defend costs
Benefits of a livestock identification system far outweigh costs that farmers will incur adopting it, says project head Ian Corney. He says farmers should not get bogged down in cost-benefit analyses over different sets of figures. Corney, chairman of National AnimalIdentification and Tracing project (NAIT), says if an outbreak of a disease put NZ out of the international market, the total cost of NAIT would ‘disappear’. He was responding to ongoing criticism by Fed Farmers of figures used by NAIT in its cost-benefit analysis. Corney says he is astounded by the federation’s criticism as it has served on NAIT’s governance committee for four years and has been party to every decision. He says farmers should see the ‘bigger picture’ and consider the impact of losing the $750 million Asian market for not having a recognised animal identification system. more>>>

Bumpy ride on carbon tax whatever way you go
Climate-change policies are an air-mile ahead of the other pressing environment challenges facing the country this election.All the parties, bar Act, take the threats of climate change seriously and it is the speed of NZ's response through the newly introduced emissions trading scheme that is causing the most debate.But no matter how hard or softly NZ hits the brakes on its greenhouse gas emissions, the country seems set for a bumpy ride. If we go slowly we put at risk our international reputation as a clean, green country and increasingly fussy overseas consumers may punish us in supermarket aisles and travel agencies, hurting our exports. Our Kyoto Protocol commitments for 2008-2012 mean the taxpayer will, meanwhile, effectively pick up the lion's share of the bill for excess emissions from subsidised big-industry polluters including agriculture. If we go too fast we could disadvantage exporters such as farmers in markets where their competitors are not yet having to wear the costs of their emission outputs. more>>>

Pig cell treatment cells approved
The trademark smile of Invercargill Mayor Tim Shadbolt grew even wider yesterday after Health Minister David Cunliffe approved clinical trials of a controversial diabetic treatment involving pig cells. Mr Shadbolt faced derision when he insisted on rescuing pigs being culled from the sub-Antarctic Auckland Islands, paying for the pig-feed to keep them in Southland. However, yesterday's announcement has given the mayor the last laugh. The genetically pure, disease-free pigs are to provide the cells for the treatment trials. Mr Shadbolt said the decision was great for the city and for diabetics. "I am hoping the story one day will be `Invercargill saves the world'." The trials will be conducted at Middlemore Hospital in Auckland by Auckland-based company Living Cell Technologies and involves transplanting Auckland Island pig islet cells into the abdomens of diabetic sufferers to encourage their bodies to produce insulin to regulate their blood sugar levels. more>>>

Milk flow may double
A "hare-brained" scheme to double NZ's milk production without doubling the national herd could be worth $4 billion to the agricultural industry. Members of the AgBio Innovators Academy at Waikato Innovation Park, Ruakura, are working on a way of doubling the production of milk solids without increasing the herd after a September workshop hosted by Bill Wilmot, a US expert on technological innovation.Prof Wilmot is also working with Silicon Valley-based technological innovation consultancy SRI International on value creation. Peter Dowd, the CE of the academy, could not discuss the details of the scheme as they were commercially sensitive, but said if it was successful it would be the equivalent of creating a new industry. "To come up with hare-brained schemes is quite important, as it is to have a place where you can come up with them safely," Mr Dowd said. Those working on the proposal expect in March to present it to a forum of chief executives, and managers, from AgResearch, Fonterra, Gallaghers , LIC, the NDA Group and Milfos. If the forum approves, the scheme could take 15 to 20 years to implement. more>>>

Get back to basics says economist
With rising costs and volatile milk payouts, NZ dairy farmers need to get back to the basics, DairyNZ economist Matthew Newman said. He talked to 70 rural professionals, including bankers, accountants, fertiliser reps, vets and educators at a DairyNZ seminar on farm profitability at Massey University last week. "Get back to the basics that NZ dairy farms do well, that is low-cost production based on natural resources [pasture and weather], genetics and the knowledge-based industry," Mr Newman said. He said the milk price is fluctuating and farmers should expect a possible payout of $5/kg of milk solids. "Not this year, or next, but it could easily happen and dairy farmers need to be aware of it." He said that in the past 10 years, more NZ dairy farms have intensified, running more cows, adding feed inputs, needing more skilled labour and having to change the way they think about farming. "That's made them more vulnerable to the sorts of cost rises happening now." more>>>

Interference in land values alledged
Political interference in the valuing of high-country pastoral lease land to force lessees into tenure review, was alleged at the Land Valuation Tribunal sitting in Dunedin yesterday. Nick Davidson QC made the claim when opening the case for Minaret Station in its dispute with the Commissioner of Crown Lands over the level of rent for the Wanaka pastoral lease, saying the Crown admitted that in its evidence last week. "The Crown is increasing rent to get tenure review going by forcing lessees to the table. This was expressly recognised [during the Crown's evidence] and at that time it also recognised legislation will have to change. But legislation hasn't changed, yet the Crown has directed a change in approach," he said. Minaret Station, on the western shores of Lake Wanaka, is appealing changes to the way the land is valued and rent calculated, which includes amenity or non-pastoral values. The case is being seen by the Crown as a test for the way it values land and sets rents, but lessees say the lease agreement forfeits the Crown's right to rent for those amenity values. Mr Davidson said the Crown directed land valuers to include amenity values even though it acknowledged the new rents were in many cases not affordable. more>>>

Farmers set to hop across the ditch
Farmers who claim Labour's emissions trading scheme will put them out of business say they will hop the ditch to Australia if it is not changed after the election.Stuart King, who with his Australian-born wife Lorae farms 500 cows at Elstow, near Te Aroha, said the scheme, passed last month, looked like a revisited "fart tax" and would cost his business between $50,000 and $300,000 a year depending on the price of carbon."It will drive business out of NZ," Mr King, chairman of Te Aroha Federated Farmers, said . We don't have to stay in NZ and Australia will treat farmers better."Mr King said New Zealand has got to get back to 1990 levels while Australia only has to get back to 106% of 1990 levels. more>>>

Fonterra says smaller firms subsidised
Fonterra continues to object to the Commerce Commission's position requiring the cooperative to supply more milk to Kaimai Cheese Company and Grate Kiwi Cheese Company at what Fonterra claims is a subsidised price.Last week, the commission confirmed its preliminary view, with a draft determination requiring Fonterra to supply milk to smaller competitors at a determined price. Interested parties have till October 31 to make submissions before the commission's final ruling.Fonterra has long claimed the default milk price is subsidised and amounts to an unfair transfer of funds from its farmers to the smaller dairy companies, many of which are owned or part-owned by overseas corporates. In August, the Agriculture and Forestry Ministry said it was investigating an auction system to determine a fairer price. Fonterra supports this. more>>>

Alliance doubles its NI sheep supply
The Alliance Group has doubled its North Island sheep processing capacity with the purchase of a lamb, sheep and beef processing plant Levin Meats. The Invercargill co-operative already owns a sheep processing plant in Dannevirke, but chief executive Grant Cuff said the second plant would shore up supply and allow it to extend its out-of-season lamb processing while also expanding in to beef processing. Certainty and quality of supply, especially for chilled lamb, enhanced annual promotional programmes, consumer awareness, product development and brand positioning, he said. The plant can process up to 750,000 lambs and about 40,000 cattle a year, and Alliance had no immediate plans to increase that capacity. The purchase would also allow Alliance to shore up supplies of lamb and sheep at a time when numbers were falling, but Mr Cuff said some of that had been caused by drought in the North Island, and they should recover. more>>>

Wool, its tough at the bottom too
As the corporate arm of the wool industry jockeys for first place to woo the bulk of the crossbred clip, a South Canterbury shearing contractor shares his perspective.Bruce Rogers is also a sheep farmer and well aware of the changes in the landscape as dairying and lifestyle blocks swallow up sheep farms. He believes one of the problems is that too many hands touch the wool beyond the farm gate and want payment for it. Mr Rogers questions the need for some of the people involved and feels they should look at whether they are enhancing the wool industry. Along with other farmers he found it difficult to understand what was happening at the corporate level of the wool industry because it was being complicated by companies which had disestablished, and the emergence of new ones, and farmers not being consulted or informed other than through the media, about changes which they were then expected to support. “All of these corporate groups have a piece of the puzzle - if they don’t sit down together soon and sort something out, the whole industry is ‘buggered’.” more>>>

Bank bullish on food
Strong growth in world demand for food will carry NZ through the worst of the global financial crisis, according to BNZ national managing partner Tony Arthur."The drivers of demand are entrenched, particularly in China. I am very very bullish," he told a Guild of Agricultural Journalists conference in Wellington. Growth in China's economic zones had brought a westernisation of culture and a step-change in dietary habits. Growing consumption of protein and complex carbohydrates was driving international dairy price rises and was beginning to lift beef and lamb prices. This would only keep on increasing at an "unbelievably staggering" rate. Forecasts had China as the likely dominant world economy globally after 2040. It would be joined by other developing countries in growing the world's newly affluent middle class projected to be 1.2 billion people by 2030, a 300% increase over 2005. The world's food stockpiles were falling. In 1945 the world had 365 days of food available in warehouses; now it had 35 days. The USs' subsidised diversion of corn feed to biofuel had further reduced stockfood supplies and increased food prices. At the same time, Australia was reducing its sheep and cattle numbers. more>>>

Feds- lamb well on the way to reaching T150
Sheep farmers may be well on the way to reaching Fed Farmers' T150 goal after a new partners' programme called BackboneTM was announced by SFFs today. Meat & Fibre chair, Bruce Wills says he is extremely encouraged by the new integrated supply chain that focuses on the three areas that its T150 campaign said needed to change. In its new proposal Silver Fern Farms shows: Commitment to supply for growers and processors. Incentives to supply livestock outside peak processing season. The move to heavier lambs. "SFFs must be congratulated. I have reviewed the figures and with this proposal farmers are looking at $90 to $110 for a "19kg Euro lamb" for next season. We are well on the way to reaching our $150 target. This is very good news. "Federated Farmers has only just launched the T150 programme, and some have felt uncomfortable with such a ‘highly aspirational figure'. "There is much more that needs to be done throughout the industry to achieve better and more sustainable returns to growers but this is certainly a good start." more>>>

It costs at least $80 to produce a lamb
Sheep farmers will be hoping meat companies are light with their predictions of $80 for lambs this season, with a farm consultant estimating that it would cost at least that much to produce them. Geraldine farm consultant Peter Clarke said in an interview that in 2007 it cost $67 to produce a lamb, but soaring fuel and fertiliser costs had pushed that to $80 this year. Fertiliser costs have risen from $6.50 a su to $11.50 a su before the latest price changes, and Mr Clarke said this had helped push up farm working costs from $40 a su to $49 a su. In 1997 they were $26 a stock unit. He based his calculations on a typical downland finishing country farm, but said the equation would differ on store lamb, high class finishing country or irrigated countryIt was based on a 4000 su owner-operator unit with casual labour, and a 3000-ewe flock that lambed at 130% with all surplus lambs finished. Mr Clarke said he worked on costs that were adequate but not extravagant. more>>>

Norgate tips milk to rebound
International milk prices will rebound strongly next March or April, according to NZ Farming Systems Uruguay director and former Fonterra chief executive Craig Norgate. Making the prediction at the PGG Wrightson offshoot's annual meeting in Auckland yesterday, he said there was still strong demand from China and India and oil-producing economies such as Algeria, Venezuela, Mexico and Indonesia."Even if we get a global recession, as we may well do over the next 12 to 18 months, you're still seeing that level of demand that was there a year ago continue," Mr Norgate said. On the supply side, only the US was really ramping up production for export, he said. "With the exception of the US, you haven't really seen a supply response to the high prices. "There's more drought in Australia and drought in NZ, while the increase in milk production from Brazil, Argentina and Uruguay was minuscule. more>>>

Effluent problems persist
The threat of being "shut down" has been aimed at dairy farmers after serious effluent discharge problems were found at eight farms throughout the region. The strongly worded comments came from Otago regional councillors during a council compliance committee meeting in Dunedin yesterday. The regional council got tough last season and took 26 dairy farmers to court for effluent discharge-related problems. The council had hoped for a better result this season. However, with only 120 inspections of the region's 379 dairy farms complete, eight cases were already being investigated - a result worse than last year. None were repeat offenders. Council resource management director Selva Selvarajah said the eight cases being investigated involved effluent going into tile drains and then into waterways, puddling of effluent, breakages of effluent irrigation systems, and one case where silage was pumped into a drain. Cr David Shepherd asked whether non-compliant dairy farmers wanted the regional council to "shut them down". more>>>

Taranaki riparian plan on track
The Taranaki Regional Council (TRC) remains upbeat about helping farmers fence and plant 10,000km of streambanks by 2015 in a bid to maintain water quality in the region. It remains on track to equip 90% of the region’s dairy farmers with a riparian management plan by 2010. TRC’s operations director Rob Phillips says the challenge over the next seven years is to increase implementation of riparian plans, which the council prepares free of charge for farmers. It has prepared 1882 plans in total, of which 1186 are for dairy farms, representing 62% of the region’s 1900 dairy farmers, and is confident of completing plans for the remaining 714 dairy farms. Phillips says with increased good payout, the council believes now is the ideal time for farmers to look at increasing investment in riparian management. For the year ending June 2008, the council/farmer partnership put 240,000 plants in the ground and the council is looking at another 300,000 plants this year. more>>>

Converts to the dairy herd
This is a new dairy farm.The rotary milking shed is almost fresh out of the box, and the irrigator stands unmuddied in the fields. And the people, too, are new to dairying. They've started well – Fonterra's daily digest of milk returns has them already performing at above the top 10% for their district – and their modest goal is to coax at least 400 kgms from each of their 1150 cows by season's end. Former lamb finishers and potato growers Donald and Karen Fraser have spent $15.5 million on land, shed, cows, Fonterra shares, irrigator and associated infrastructure, such as fences, laneways, water reticulation and effluent treatment. The remodelled farm joins the many other dairy conversions that in recent years have transformed the free-draining central Hawke's Bay flats. He is an enthusiastic supporter of the dairy industry. "I like the way it all fits together, everybody supporting each other, and with one big guy, Fonterra, to look after it all." By contrast, he says, the meat industry is in disarray, with competition between NZ companies in overseas markets undermining farmers' profitability. But with dairying, the likely payout is signalled well in advance and budgeting is straightforward. "It's all set out in front of you and the great thing is it's up to you to decide how you want to farm to make the most of it." more>>>

San Lu link threatens Kiwi image
NZ's clean, green and friendly image in China may be under threat in the wake of the melamine scandal if communications are not well managed, a just-released report says. Very few Chinese consumers are aware of the connection between NZ and SanLu - the Chinese dairy company 43% owned by Fonterra that was at the heart of the scandal, it said. Tainted Brands - a report from China-based media research company All Media Count - surveyed 900 Chinese consumers in several major cities and some provincial areas between September 22 and September 26. Only 3% of respondents felt worse about NZ because of the melamine scandal.But many were not aware that a NZ company is SanLu's partner. "When informed of this fact ... many people experience a negative shift in feelings toward the country ". "Any future disclosure about the connection between SanLu and NZ could, if not well managed, further tarnish the image of the country." All Media Count was set up around a year ago by NZ expatriate Mike Underhill. He said that Fonterra's recent $8.4 million donation to set up a rural healthcare project was a good start in terms of managing both Fonterra and NZ's image in China. more>>>

AFFCO chair stays confident
Affco was confident of maintaining its market share in Southland despite a major decline in the ewe flock, chair Sam Lewis said.
Mr Lewis said the company, which has poured significant investment into its South Pacific Meats plant at Awarua, was processing about 600,000 sheep, lambs and bobby calves each season. Mr Lewis told about 40 suppliers at a meeting in Gore last night that Affco had injected about $135 million into plant upgrades and another $175 million into repairs and maintenance projects over the past five years. It bought a meat plant at Malvern, near Christchurch, in October last year and was focused on expanding its South Island beef kill. It had also moved into vension processing in the past year with "remarkable success" and now had about 25% of the North Island deer kill. "Our customers want everything, not just beef and lamb," Mr Lewis said. more>>>

Limousin gene shows trait benefits
A gene which increases the weight of prime cuts by 19% and overall beef yield by 7% has been discovered by researchers at Adelaide University in Australia. The gene, a modification of the myostatin gene called F94L, is shown to occur with high frequency in Limousin cattle but with very low frequencies in other breeds.
"The F94L gene also causes a 20% reduction in intramuscular fat and a 30% reduction in external fat cover resulting in healthier beef and higher yields of retail beef from each carcase,"
Adelaide University team leader, Dr Wayne Pitchford
He said the research showed exciting results with the gene increasing the amount of prime cuts in the carcase by as much as 19%. "Animals with two copies of the gene consume the same amount of feed as animals with no copies of the gene so they are much more efficient at producing beef" he said. Dr Pitchford said the gene also increases tenderness. "The F94L gene also causes a 20% reduction in intramuscular fat and a 30% reduction in external fat cover resulting in healthier beef and higher yields of retail beef from each carcase," Dr Pitchford said. The testing has revealed that the frequency of the gene in purebred Limousins is 98.3% which means that almost all purebred Limousins carry two copies of the gene. more>>>

Wool company sale queried
The recent announcement from Wool Partners International (WPI) that it will buy the Wools of NZ (WONZ) group of companies has raised a furore among some of the wool industry fraternity because of a perception it is a grower-owned company and who gave the mandate to sell it? Among dissident voices are directors of Primary Wool, Wool Advancement Group and Romney NZ. As a collective, which, they said, represents 30% of strong wool producers, they asked Straight Furrow to question Mike Peterson, past chairman of Wool Research and chairman of WONZ for the past two years, about the sale process. Mr Peterson’s concern was that the company remained in NZ, because $260 million of levies had gone into establishing the brands which went with it. He convinced Wool Research to buy and secure the company until such time as a suitable buyer, who would build the business, could be found. Last October in his Wool Research annual report, Mr Peterson outlined plans to sell WONZ to a recognised entity that might eventuate from the Wool Industry Network plans to create a company capable of restructuring the wool industry. As events have transpired this is WPI. more>>>

Electronic animal tagging trialed
A pilot project has used 26 Waikato and King Country farmers to refine the new national system for livestock with an electronic chip. The animal identification and traceability (NAIT) study showed over six months that meat processors and salesyards will be able to work with NAIT, though they will have to modify equipment and systems to record information from the radio frequency identification device (RFID) ear tags. Three meat processors, three sales organisations and 12 transport companies took part in the trial. "We want to make sure the system works as well as it can and that it is as easy to use as possible by farmers and industry," said Ian Corney, the independent chairman of the joint industry and government project. "The results will be used to help refine the NAIT design," he said. "Provided there is sufficient education, the study showed that farmers should easily grasp the new system, which in many ways is not that different from current tagging requirements". more>>>

Water key to food security
Irrigation's role in ensuring food security and enhancing the environment will be key issues at this week's Irrigation NZ conference in Christchurch. Farmers and irrigators will hear from speakers on several main themes, including global food security and sustainability, water allocations and NZ's options, environmental enhancement under irrigated agriculture, market realities, and improving water management. Adelaide University Professor of Water Economics and Management Mike Young will talk tomorrow morning about "learning the hard way: lessons from across the trench". Young is an ecological economist who has been a policy adviser to Australian prime ministers Kevin Rudd and John Howard. Other speakers include New South Wales farmer Dick Thompson of Murrimbidgee Irrigation, Canadian engineer Dale Miller who led the design of 600,000ha of irrigation in Alberta, and Agriculture Minister Jim Anderton. more>>>

Exchange rate fall shelters farmers incomes
The slumping NZ $ has provided dairy farmers with some shelter from commodity price falls in international markets, but dairy prices have still fallen.The NZ$ dropped to an exchange rate of USD59c in early October, a two year low, and it has shed 12% against the greenback over a two week period. Rabobank has reported dairy prices have fallen 5 – 15% lower over the past month in local currency terms. Farmgate beef prices continued to increase in early September, then levelled off later in the month, and beef prices remain 25 -30% above last season, about 80c-110c/kg, helped by good international prices, the lower exchange rate, and reduced availability of stock for processing. Farmgate lamb prices continued rising during September, increasing by 6% (around NZ30c/kg) to exceed $NZ5/kg across the main weights and grades. "Prices are now at unprecedented levels and have reached 35%higher than the same period last year," the review said. more>>>

Sticking it to thistles
Californian thistles (Calis) are a major problem on NZ farms, from Southland to the Far North. It can be an expensive exercise to control and even eradicate, but what about the cost of doing nothing? The methods of controlling this thistle are varied, but significant work has been done over the years and it is all about choosing the best method to suit your situation. There are three important steps in this process: timing, chemical selection and equipment choice. 1. Timing: big, mean and ugly. To kill this plant you must get the chemical down into the rhizomes root system. To achieve this we must wait for the sap flow to be directed down into the root system.2. Chemical selection: there are many theories and brews. Chemicals to use: Glyphosate at rate 20/1 (Roundup) or Clopyralid at rate 40/1 (Multiple, Versatill). 3. Equipment choice: for the application of a herbicide there are two options – spraying or wiping. Spraying can be the only option on steep terrain where access is limited but has the disadvantage of a restricted chemical selection.The Rotowiper system has some huge advantages over spraying. The key to this system is you only kill what you touch. more>>>

Credit crunch hits farm sales
Fifteen prospective farm sales around the country failed last week because of the escalating global credit crisis, with some buyers walking away from deposits worth hundreds of thousands of dollars. A real estate company told the ODT funding that had previously been arranged could not be secured in time. Some of the contracts were unconditional when funding became unavailable, which meant the buyers lost their deposits, in some cases worth several hundred thousand dollars, or had to pay penalty interest. The agent asked not to be named. For each sale that failed to settle, up to four other land and property deals were affected. "You have to be in a really strong position to settle a rural real estate deal at the moment," the agent said. The uncertainty had placed many farmers under enormous stress and strain. The director of rural investment company MyFarm, Andrew Watters, said banks were tightening their lending criteria and he had noted several were not as active in rural lending as they had been a few weeks ago. "We've had a number of traditional banking partners but some are now sitting on their hands a bit." more>>>

Capital raising deferred
NZ Farming Systems Uruguay's capital raising plan to buy more South American farmland has stalled, with the listed dairy company yet another victim of the spreading credit crunch.Details of Farming Systems' capital raising were due to be announced at next week's annual meeting but the financial environment to support such a plan had deteriorated too much, chief financial officer Andrew Clark said. Farming Systems, which develops Uruguayan farms into land for milk production, would give an additional update to shareholders at the Auckland annual meeting. The cancellation is the third big blow to the dairy industry this month. PGG Wrightson's deal to buy 50% of meat processor Silver Fern Farms has been threatened by pressure on credit-stretched banks, and Mataura Valley Milk's $90 million greenfields dairy factory plan has been put on ice for 12 months. more>>>

Mystrey Creek worth $865 million
An independent study undertaken by the Management Research Centre at the University of Waikato found that National Fieldays 2008 had a national economic impact of $865 million. The Waikato region gained $265 million of economic benefit. This study found that the record attendance numbers of 131,629, and their purchase activity resulted in sales of $285 million from the Mystery Creek event. The survey reported export sales of more than $117 million from the 2008 Fieldays, up from $50 million in 2007. Total sales achieved by exhibitors during the four days were $209 million, up more than 10 per cent over 2007. more>>>

Lessees await rent test case outcome
The Govt's $40 million purchase of St James Station in Canterbury is further evidence the Crown has given away its rights to amenity values on Crown pastoral lease land, farmer advocates say. News this week of the historic property's purchase came on the eve of Monday's start of a two-week hearing by the Land Valuation Tribunal in Dunedin to consider an appeal over the way LINZ sets rent on pastoral lease land. Farmers and the Govt have agreed the hearing, over rent-setting methodology involving Minaret Station at Wanaka, would be a test case for the way future rents would be set. Up to 80 lessees have appealed their new rent levels, in anticipation of a favourable outcome in the Minaret case. Last year, the Government commissioned an independent review on rent setting, the Armstrong Report, which concluded rents were fair and in some cases excessive.It recommended basing rents on stock-carrying capacity rather than on land exclusive of improvements. But the Government ignored those findings and decided amenity values, such as scenery and access to lakes and mountains, should be included in rents, which saw some rent levels increase by up to 600%. In many cases, the new rents exceed the gross farm income earned from the property. more>>>

Rabobank reassures farmers
Leading rural lender Rabobank says farmers and agribusinesses in NZ can be assured that it is business as usual from the bank’s perspective in the farm finance market, despite current global volatility in both financial and commodity markets. Speaking today, Rabobank GM NZ Ben Russell reaffirmed the bank’s commitment to NZ agriculture and its desire to steadily build its share of the rural lending market. Mr Russell said the bank retained confidence in the medium to long-term outlook for NZ agriculture and, despite current difficulties in financial markets and a slowing local economy, was adopting a "business as usual" approach to its rural lending business. "Rabobank always maintains a prudent approach to rural lending, assessing loans on the basis of debt serviceability (using long-term price and cost assumptions), collateral and management ability. The bank will continue to use this approach in the future, welcoming opportunities to assist existing and new clients with their legitimate business development and growth plans,” he said. more>>>

Livestock less damaging than UN claimed
A blunder has seen NZ blamed for climate change caused by other countries, the UNs' FAO has acknowledged.The FAO report, Livestock's Long Shadow, made public last year to world acclaim, states that livestock contributes 18% of the global warming effect, even more than transport. But buried in the report is the information that deforestation - mainly in the Amazonian rainforest - is included in that figure. Without it, livestock's contribution falls to less than 12%.This has been ignored in public statements made since the report's release. The most controversial was by the chairman of the UN Intergovernmental Panel on Climate Change, Rajendra Pachauri, who urged people to eat less meat. But now one of the report's authors, Pierre Gerber, has acknowledged NZ's view that it was unfair to lump all countries together. This is according to Silver Fern Farms, whose marketing manager, Glenn Tyrrell, spoke to Dr Gerber recently. Mr Tyrrell said Dr Gerber was critical of Dr Pachauri and others, saying they had misused the information in the report. more>>>

High noon for high country?
Farmers’ representatives go to court in Dunedin next week for a test case that could determine the future of the South Island high country. Minaret Station is appealing its pastoral lease rent at a long-awaited hearing of the Otago Land Valuation Tribunal. It is one of dozens fighting what are seen as unjustified and unlawful increases designed to force them into Tenure Review.‘This case is very important,’ says High Country Accord chair Ben Todhunter. ‘About 65 rents out of 250 pastoral leases have been recently notified and of those nearly all have been appealed to the Land Valuation Tribunal.’ The average hike is 600% and in some cases rents are now more than twice gross farm income. Fed Farmers high country section chairman Donald Aubrey echoes Todhunter’s comments about the magnitude of the case. ‘Unless the issue of rents can be solved then farming in the high country will not be sustainable.’ Conservation is also threatened because families farming the land have generations of knowledge about its management. more>>>

Money crisis warning to meat industry
The meat industry should be wary of the flow-on effects of the international financial crisis, says SFFs chief executive Keith Cooper.Diminished spending power in the lucrative European and US markets could hurt the sales of premium products, he said. "That describes most of our products." The initial impact on meat exports was beneficial, with a fall in exchange rates, but Mr Cooper said he also had "caution rather than pessimism" about the possible flow-on effects."If banks are not lending money, what does this mean for small to medium-sized businesses? Ultimately, if there's less money in the economy, less discretionary spending, people spend less on premium products."One way of lessening this risk was to move away from reliance on traditional markets in Europe and the United States. more>>>

Feed quality the key in supplements
The intensification of NZ dairy farm systems will force farmers to produce more high-quality supplementary feed than ever before, according to a leading forage expert. Pioneer Brand Products forage specialist Ian Williams told about 60 farmers and contractors at the 2008 South Island Silage and Supplements conference that about 4.4 mill more tonnes of supplementary feed would be required to feed the national dairy herd in 2017. "As our dairy systems intensify there will be a growing need to produce more feed -- and as land prices increase there will be a need to get more off the land," he said. Mr Williams predicted the national herd would increase by 580,000 cows to about 4.5 mill during the next 10 years. Per-cow production would increase by 63kg of milksolids, from an average of just under 400kgMS, which would result in total milk production growing by about 34% by 2017. As a result 4.4 mil tonnes more supplementary feed — greater than 10.5 mg/me— would be required to fuel the national dairy herd. Stocking rates were also expected to increase from about 2.7 to 3.6 cows per hectare. more>>>

Cryptosporidiosis cases rise on dairy increase
The number of cryptosporidiosis cases were on the rise in Southland and it could be linked to increased dairying in the region, Public Health South medical officer of health Marion Poore said. All occurred among dairy farm workers or young children living on dairy farms, Dr Poore said. She said it indicated there could be a link between the increase of cases and the increase in dairying activities in the region. The number of cases typically tends to rise further during October, with 27 notifications last year, Dr Poore said. However, the number of notifications usually represented only a fraction of the actual number of cases in the community. Good hand hygiene was the best way of preventing the illness, Dr Poore said. more>>>

Shining the torch on the BVD virus
Bovine Viral Diarrhea Virus is a costly disease that affects cattle and other ruminants. The virus has many nasty effects, including fever, diarrhea, respiratory and reproductive disease, abortion, birth defects and death. The national economic impact of the disease has not been assessed in the US, although one document estimates that acute BVDV could result in losses of $50 to $100 per cow. At the National Animal Disease Center (NADC) in Ames, Iowa, Agricultural Research Service microbiologist Julia Ridpath is leading important research to help control BVDV and limit its devastating economic effects. Some of the NADC studies are uncovering information that will be crucial for developing effective prevention strategies. One such study is exploring whether deer can serve as vectors for introducing BVDV into uninfectedcattle herds. Preliminary results show that cattle and deer have similar responses to the virus. "We have shown that BVDV causes reproductive disease in deer that is similar to the reproductive disease seen in cattle following BVDV infection," Ridpath says. Identifying potential virus reservoirs in wildlife is a critical step toward preventing transmission to cattle. more>>>

Nicolson slams tagging scheme
A "number plate" on every cow and deer would not produce any significant cost benefit, Fed Farmers president Don Nicolson said.
Mr Nicolson has slammed the National Animal Identification and Tracing system that is expected to force cattle and deer farmers to meet mandatory tagging requirements of their animals by mid-2011. Tracing system chairman Ian Corney said the tracing system was needed to improve NZ's ability to respond to biosecurity alerts and provide food safety assurances to its customers. However, Mr Nicolson did not believe the system would provide any financial benefit and instead advocated for more robust biosecurity measures at the border. "The biggest threat of disease entering our country is from sheep and from scrapie. "They (NAIT) say sheep will be included, but they won't be in from day one, that doesn't make sense," Mr Nicolson said. more>>>

Opportunity and risk in spring surplus
How well farmers manage this year’s spring surplus feed will determine how well their cows milk through the summer, advises DairyNZ General Manager Field Extension, Dave Miller. “The right pasture management decisions made today will have a significant effect on the farmers’ end of season result.”“Feed surpluses are developing rapidly, which provides a great opportunity to feed cows well and replenish depleted supplement reserves. However, there is also a risk that pasture quality will be lost and summer milk production compromised when too much attention is paid to daily milk production and not enough is paid to pasture management. “Maintaining post grazing residuals at 1500-1600kgDM/ha (7-8 clicks on the plate meter) and cow intakes at 3.5% of live weight have been demonstrated to be the keys to maintaining pasture quality and achieving good production levels. These targets can be achieved by offering the right amount of pre-grazing cover. more>>>

NZ wins four shearing world titles
NZ enjoyed its biggest day at the World Shearing and Woolhandling Championships by winning four of the six titles. On the final day of competition, Paul Avery, a farmer from Toko, near Stratford, and fulltime Napier shearer John Kirkpatrick, were first and second respectively in the glamour event, the machine-shearing final, after earlier winning the teams title. Taihape schoolteacher Sheree Alabaster, 32, won the woolhandling title, consigning team-mate and 2003-2005 champion and Australia-based Wanganui woolhandler Joanne Kumeroa, 39, to second place, with the pair also winning their teams event final. The triumphant Avery and Alabaster were each presented with cash prizes, and 30cm high saue bjelle , the gold-coloured sheep bells which became popular as Norway representation items at the 1994 Winter Olympics in Lillehamer. more>>>

Fonterra tackles effluent issues
Fonterra says some farmers are falling short of being dairy effluent compliant and the cooperative is working on the issue. It has employed a team of sustainable dairying specialists to advise farmers and a dedicated effluent engineer to help in problem regions. Fonterra’s sustainability leadership team chairman Barry Harris says while the Dairying and Clean Streams Accord is making dairy farmers more accountable for the environment, dairy effluent compliance remains an issue.‘We know dairy effluent management is our Achilles heel, and we’re doing something about it,’ he says. If these suppliers don’t meet the deadline we set to lift their game, we impose a financial penalty and ultimately can refuse to pick up a supplier’s milk. But he denies a claim by environment lobby groups that the accord is not working.
Four of the five targets laid out in the accord for Fonterra farmers to meet were achieved by 2007 – the halfway point for the agreement. more>>>

AgReseach cutting back
AgR, the nation's biggest CRI, which has its headquarters in Hamilton, is looking at cutting costs through voluntary redundancies. The company, which employs about 1000 people nationally across four campuses, emailed staff on Thursday calling for voluntary redundancies by October 22.The move is designed to save $2.4 million of its $68 million wage bill.CE Andy West said he could not say where the losses would be felt, nor how the call would effect the 400-strong Ruakura campus. It was likely there would be redundancies from Ruakura, Palmerston North, Lincoln and Dunedin. A combination of factors had forced AgResearch's hand, Dr West said, including the long-term downturn in the sheep and beef industry which had seen prices drop, and a reduction in work from that sector. "We are not immune to that," Dr West said. "I am not, in any way, critical of that industry. What happens to them knocks on to us. more>>>

Gorse leaching culprit
Gorse has been identified as a source of nitrogen leaching that rivals dairying.A 20-month study by Dr Guna Magesan, a senior scientist with crown forestry research institute Scion, found that leaching from dense gorse in the Rotorua lakes' catchment is 40-60kg of nitrogen a hectare a year. This equalled dairying on a per hectare basis. Gorse is widespread in NZ. It is highly invasive and fast growing, and has already taken over 900,00ha nationwide. It can live for more than 40 years and seeds can remain in the soil for up to 30 years. "My hope is that these results will motivate interested parties such the Ministry of Agriculture and Forestry, the Ministry for the Environment and the Department of Conservation to take another look at how we can reduce the detrimental effect of such weeds," Dr Magesan said. more>>>

Grazing expectations track higher feed costs
The expectations dairy farmers have of those wintering their cows has increased in line with the rising cost of grazing. Some Southland dairy farmers paid $30 a cow a week last winter, up from $18 just a year earlier, but PGGW SI dairy livestock manager Paul Edwards said in hand with those higher prices, were the expectations of owners about how their cows were fed and cared for over winter. Despite the large number of wintering contracts, Mr Edwards said there were relatively few disputes, but he said there were some golden rules to ensure the process ran smoothly. Formal contracts should be agreed to and signed, with both parties understanding their obligations and expectations, the amount of winter crop available measured and a system for reporting and monitoring stock condition implemented. It was important that the stock owner or someone they trusted check on cow condition weekly or fortnightly. more>>>

PGGW still working on meat industry plan
PGG Wrightson is continuing to work to put together a finance package for its $220 million bid to buy a 50% stake in meat processor SFFs. On Tuesday, PGGW was unable to settle its first payment of $145m for the deal, blaming "extreme financial market conditions". PGGW chairman Craig Norgate said a number of banks which had committed to participate in funding the transaction had since been unable to finalise their credit approvals in time for the part-settlement. Yesterday the company cancelled a $78m placement of shares to institutional and other investors due to the delayed settlement. Mr Norgate said there was a lot of goodwill between PGGW and SFF, with both companies working hard to make sure the deal could go ahead. The problem that caused the first settlement to be missed had been just one aspect of an integrated package and could be fixed, he told Radio NZ. The banks were now saying, "we won't do that to you again". The current agreement gave PGG Wrightson all of October to keep working on the deal. more>>>

Wool Partners buys research companies
Wool Partners International chair, Theresa Gattung has announced that the company has entered into a Heads of Agreement with Wool Research Organisation of NZ Inc. (Wool Research) to purchase the Wools of NZ group of companies. Gattung says the acquisition is provides “an international network of market relationships and capability which will assist Wool Partners International.” Wool Research advised its members at its most recent AGM its intention to transfer the Wools of NZ group to the integrated marketing company that was proposed as part of the WIN’s wool sector strategy. With the recent establishment of Wool Partners International, this has now been made possible. WRO NZ chairman, David Douglas says the sale is “a pleasing outcome to the “caretaker” role that Wool Research has been performing over the last two years. Our objective of ensuring that the value of Wools of NZ was preserved for the benefit of the NZ wool sector is now being realised.” more>>>

Growth chemical a popular choice
A dairy consultant said plenty of farmers have been using the plant growth regulator ProGibb SG, but it is not cheap or easy to apply, and works best to boost growth to allow an extra round of grazing on farms. Louise Cook, from DairyNZ, said it has been popular, but at $23/ha its reasonably expensive. She said the big picture is $1.2 million/ tonne, however, it is applied at only 20 grams per ha. The company, Nufarm, which supplies ProGibb SG said on its website that the plant growth regulator increases pasture production 30- 60% within three weeks of application. It said it worked best where rotational grazing was used, and for best results should be sprayed on pastures between one and three days after grazing. Treated pasture should be grazed two to four weeks after application, although the maximum dry matter production is evident after three weeks. "It is no use increasing the application rate - no more grass will grow. Adequate nutrients and water have to be there, too. If there are not enough, any of those will limit the impact of the plant growth regulator," she said. more>>

Specialists trawl internet for rare bulls
Hereford breeders John Morrison and his sons base their most important stock purchases on information gleaned from the Internet. Not for them the clamour of a malodorous stockyard auction. They prefer to sit quietly at home and study a bull's vital statistics.It's a sign of modern farming. With only a few keystrokes they can draw on the accumulated brainpower of the Hereford beef cattle world, distilled into 25 million EBVs. The EBVs measure the performance of a bull's progeny in key areas. Most beef farmers want an animal that will quickly put on weight, so they pay close attention to the values placed on a growing animal's weight at 200, 400 and 600 days of age. It's the meat trade they have their eye on. But the Morrisons are aiming at a different market. They provide yearling bulls to dairy farmers, who first mate them with yearling heifers and in their second year put them over the milking cows who fail to get pregnant through AI.It is a specialised business. The farmers will want the resulting calves to be fast-growing beef animals to sell to calf rearers or to keep for their own beef units. But they don't want the calves to be so big at birth that they harm their mothers. So the bulls have to rank highly in two areas on the EBV scale - low birthweight and high growth rate. more>>

Credit crunch delays $90mill milk plant
The Credit Crunch has claimed its second major victim in the real economy. Yesterday PGG Wrightson’s plan to buy half of Silver Fern Farms with funding raised from a share issue and some bridging finance fell over at the last minute because banks pulled their funding lines. Today the Southland Times has reported that construction of a NZ$90 million milk processing plant by Mataura Valley Milk near Gore has been postponed because of funding issues in the wake of the Credit Crunch. “There are a lot of factors, there are too many risks and things we don’t know about. Everyone felt very nervous about banks blowing up left right and centre. That definitely coloured our thinking,” Mataura Valley CEO Chris Shelley told the Southland Times. Mataura says the problems in closing funding meant it risked missing the start of the 2009 milking season and construction is being put on hold for a year, until 2010. It remains confident planning for the processing plant will be re-started next year. more>>

Venison top for waist and taste
Research led by ADAS, sponsored by Defra and the Scottish Government through the Sustainable Livestock Production LINK Programme, has found that venison not only contains significantly less fat than other red meats, but also comes up trumps in taste tests: great news for the British deer industry.The research into "e;Improved Venison Quality"e;, led by ADAS with the University of Bristol, considered the taste and health properties of venison against consumer perceptions. Although venison"e;s popularity does not yet compare to other red meats, the study found that most of those who have tried it rate it "better than most meats" in terms of quality and taste and would definitely eat it again. By far the most common reason cited was its flavour, closely followed by health reasons. And there are good reasons for eating it. Analysis of samples found that fatty acids comprised only 1.2% of the fresh loin muscle weight - one-third of that found in beef sirloin steaks, or a quarter of that found in lamb chops. A similar advantage was seen in the neutral lipids, with monounsaturated oleic acid found to be nine and eleven times higher in beef and lamb respectively. more>>

Farmers tussle over maize silage prices
There is something of a stand-off between dairy farmers and maize growers as they try to sort out the going price for maize silage, says Mark Burke from Pioneer Seeds."In the end it's up to individuals to pay what they think the maize is worth to them. But most dairy farmers are telling me that they can't make it work for them if they go to 30 cents/kg/dry matter." He acknowledged there was a shortage of supplementary feed as a result of dairy farmers having to feed out thorough the drought and poor early spring.Mr Burke said grain markets internationally were beginning to soften, as in NZ and that had an impact on the maize silage price. "Also dairy farmers are having to cope with lowering dairy payout and increased costs. A few years ago, the estimate was the cost of producing milk worked out at $2.60/kg/milk solids. This year it is forecast to be at least $3.50," he said.He also noted growers had increasing costs to deal with as well. "Fertiliser is the big one, but chemicals, fuel and seeds have gone up as well to the tune of about $700 per hectare. They have to factor that in when they're working out the price of growing and selling the crop," Mr Burke said. more>>

Global credit kills meat merger
Nervous banks within PGGW’s syndicate of banks effectively killed its plan to buy half of SFFs yesterday in one of the first signs that the intensifying global Credit Crunch is affecting financing in the real economy. The deal was due to settle this week after PGG Wrightson raised most of the funding necessary through share issues, although bank bridging finance was necessary by October 1 to ensure an earlier equity raising was not declared null and void. The refusal of PGG Wrightson’s syndicate to provide that bridging finance effectively scuttled the deal. PGG Wrightson was due to hand over NZ$145 million to Silver Fern Farms yesterday as part of the NZ$220 million purchase price. PGGW Chief Financial Officer Mike Sang told interest.co.nz PGG Wrightson had planned to raise NZ$100 million through a placement of shares to institutional investors, but volatility on international markets meant it was only able to raise NZ$78.1 million, which had caused “some disquiet” with some of PGG Wrightson’s banks who were due to provide bridging finance in the form of subordinated debt. more>>

Dairy firm halts protein exports
One of the world's biggest exporters of hugely expensive dairy protein lactoferrin has suspended exports to try to clarify how it was contaminated by melamine.Tatua Cooperative Dairy Company, based in Morrinsville, said yesterday that it expected dairy exporters would test for melamine contamination in future before releasing products for sale. Tatua's board will meet today and is expected to discuss the contamination. A Chinese customer told Tatua's agent two weeks ago that melamine had been found in its product in China. Further tests were done in China and NZ, and results early last week confirmed contamination at less than four parts per million.The New Zealand Food Safety Authority inspected the factory last Wednesday. Tatua chief executive Paul McGilvary said yesterday that the company's own investigation had detected no melamine in its raw milk. more>>

Disunity hurting the velvet industry
With velveting underway, reform of the deer industry won’t happen this season, but a recent consistency in sales had generated confidence among producers. Mixed grades of velvet were fetching almost $80/kg, Velexco chairman James Guild said. It fell short of early expectations for over $100/kg, but it was possible present prices would be exceeded later. However, it was still barely covering costs. Mr Guild said the break-even figure for velvet producers was $100kg or slightly under, which, once achieved, should inspire them to remain in the industry instead of considering competitive land use, such as dairy grazing or lamb finishing.The industry has a number of issues to deal with – paramount was the need for consolidation of the velvet pool, because from unity would follow positive changes and stability for venison production. Neither velvet nor venison complements the other in terms of livestock management, Mr Guild said, though they were solvable issues. A large unified velvet pool would provide strength in terms of volume and negotiable clout with Korean and Asian buyers who tend to deal with sellers with the most volume. more>>

Lamb plan gets a roasting
Fed Farmers has received a roasting from NZ's biggest meat company over its drive for a $150 lamb within five years - almost three times last season's average.The federation began its campaign at the Stortford Lodge stock sale yesterday, where live 40-kg lambs sold for about $100 each. But it was dead lambs that the federation was talking about and they are predicted to fetch about $80 when the season gets into full swing later this year.Meat and fibre chairman Bruce Wills said "Farmers are leaving the sheep industry - 800 in the last year while sheep numbers fell by 11% - so we've got to stop the rot," he said. He saw the $150 lamb coming from an accumulation of improvements by several sections of the industry. Farmers received less than 20% of the retail value of a lamb, while the supermarkets' mark-up took 30%. "That's a fundamental flaw in the system," he said. Mr Wills said if the average lamb weight increased to 21kg and the schedule price per kg rose from the $4.50 predicted for this year to $7, that would bring farmers a $147 lamb. But SFFs chief executive Keith Cooper called the $150 target "highly aspirational" and said it could be setting farmers up with unrealistic expectations. It did not take into account the effect of the global financial crisis on exchange rates and protein demand and pricing, which could seriously affect returns, he said. M&WNZ chairman Mike Petersen said the target could be achieved but all parts of the industry would have to do their bit. more>>

Prospects good but volatility worries deer farmers
Doug Maxwell has seen it all before and he hopes this time is not a repeat. A shortage of deer sends the price soaring and meat companies scrambling for animals only for the markets to react and the price to plummet. "I have been in this situation four or five times. You get a big increase in price, then you get a big drop," the deer farmer from Springvale, near Alexandra, said. He would like to see a happy medium, where everyone made a profit - not that he was complaining about the prospect of $9.50 a kg for for the prime deer he intends selling in October and November.The extra income was needed to pay for higher fertiliser, fuel and compliance costs, he said.Mr Maxwell has maintained his deer numbers and targeted the spring supply of stock despite several difficult years. more>>

Doing the maths on winter cow grazing
Last November I wrote about the costs of growing swedes and what grazing dairy cows in winter might be worth, writes Graham Butcher in this week's Rural Solutions. I came up with $28 a week as a benchmark, which covered costs and provided a reasonable profit margin. Costs have moved up over the intervening months so it's timely to look at this issue again. The scenario: going from old grass, spray out and cultivate, fertiliser 250kg/ha DAP and 100kg/ ha urea, lime, Treflan, ridge with 100kg followup urea. Aphids need to be considered. Regrassed, but only half the costs are counted, either because there is a subsequent benefit from better pastures or because the area is likely to be second cropped anyway. Contractors are used for all work and we need to think about the tractor hours feeding out in winter and your own work or the work of employees brought in to cope with the work while feeding off. Lastly, there are the costs associated with hay, straw, balage or silage fed with the crop.....Today we have $28.32/week as the break-even point between going into wintering cows and sticking with your existing sheep policy. more>>

Jail call for farmers that pollute????
Polluting farmers should be jailed, says Environment Minister Trevor Mallard. He told the Water and Wastes Assn conference in Christchurch this week that he supported tougher sentences and even jail for serious water polluters. Exporters who continued to pollute or mismanage water and broke the rules were undermining their own products and the "valuable NZ brand". "Regional councils in particular need to be a lot tougher as far as the standards are concerned, and more importantly the enforcement of the standards," Mallard said. "Far too often these days, farmers not always farmers treat fines under the Resource Management Act as a cost of the business. We should prosecute individuals rather than companies change the focus from a fine-based system to the possibility of imprisonment." Certain breaches of the Resource Management Act 1991, including discharging contaminants into water without a consent, can already be punished with a maximum two-year prison sentence or a fine of up to $200,000. Federated Farmers president Don Nicolson described Mallard's comments as representing a "very extreme view". more>>

Beef cattle scarce in Taranaki
Dead calves, high milk prices and drought after-effects are creating a shortage of beef cattle in Taranaki. "We have gone from a drought into a bad autumn, through a difficult winter and are now in a spring that would be all right if you had some feed in the first place," Allied Farmers Taranaki livestock manager Stephen Sutton said. "There is still limited feed. On earlier well-fertilised country, yes, there is grazing, but no surplus. A lot of back county farmers are still struggling for feed. It has been a struggle for nine months. " He said the drought is definitely affecting the market. "Many sold early. It is becoming evident. Our beef numbers are less through the yard than they have been. A lot were slaughtered early due to difficult climatic conditions. Animals are being slaughtered now. If there was an abundance of prime animals, they wouldn't be selling. There is a shortage of killable stock and they are pressured into killing three to six months early." Mr Sutton said the number of calves reared is also less this year, especially bull calves. "Farmers are rearing any additional AB heifers in preference to bull calves. The high value with dairy is a better option than the dairy beef market. "And farmers would rather have milk solids in the vat than rearing calves." more>>

Biosecurity NZ gives up varroa fight
The fight to stop the march of the destructive varroa mite is over.
Biosecurity NZ said yesterday it was revoking all movement controls of beehives from today and would turn its attention and funding to research into the mite and helping beekeepers live with varroa. The decision follows confirmation of widespread infestation of hives in Nth Canterbury, with 17 beekeeping operations in the Waimakariri and Selwyn districts having varroa, some with at high levels. Ag Minister Jim Anderton said it was not feasible to eradicate the parasitic mite. "It has spread too far. With no significant geographical features to stop the flight of bees, varroa could be all over the Canterbury Plains and well on its way to Otago and Southland now." Once it had arrived in the North Is in 2000 there was no choice but to learn to live with varroa, which no other country had eradicated, Anderton said. more>>

China scandal hits Fonterra hard
Fonterra has taken a massive $139 million hit on the value of its San Lu business in China, following the contaminated milk crisis.The Co-op says the San Lu brand has been destroyed. And Fonterra is reacting with shock to news from state media in China that the San Lu Group, 43% owned by Fonterra began receiving complaints of sick children as early as last December.Chairman Henry van der Heyden expressed surprise. "I would be absolutely disgusted and appalled if information was held back," he told a crowded news conference in Auckland. "What has happened here is a criminal event." Fonterra announced a final payout of $7.90 a kilogram of milk solids for the last season. This is the number they predicted in May. Fonterra lowered the payout forecast for the current season to $6.60. Mr van der Heyden said prices have fallen away from last year's record highs. "High prices have dampened global consumer demand and, at the same time, have encouraged production increases in exporting regions around the world," more>>

SFF downgraded by broker
The absence of industry consolidation in tandem with PGG-Wrightson's $220 million stake in Silver Fern Farms, has prompted one broker to downgrade from hold to reduce shares in the rural serving company. Forsyth Barr researchers were sceptical meat company SFF would be able to capture all the synergies from the partnership without industry consolidation and were also concerned at the extra debt PGGW was incurring to fund the investment. Without additional industry consolidation, the PGG-W partnership with SFF was viewed as simply recapitalising SFF's balance sheet. "The existing industry procurement model will ensure the processors continue to bear a disproportionate share of the commodity price risk and consequently heightened earnings volatility," Forsyth Barr said. There was uncertainty the anticipated savings from synergies of $59 million a year in the short term and $111 in the long term could be achieved, and there was also risk whether they would be achieved from the value chain. more>>

Fonterra waiting for price bounce
Fonterra expects to see a ‘bounce back’ in commodity prices later in the season as supply and demand factors return to a more favourable equilibrium. But for now, Fonterra chief executive Andrew Ferrier said, a substantial fall in demand across all markets since July and increased supply, particularly from the US, have caused a rapid drop in commodity prices. The further prices fell, the more unsustainable they would be as product was cleared out, and the quicker they would bounce back, Ferrier said. “In a market of this kind of volatility, it’s hard to predict but we would expect the market to go down and then come back up before the end of our fiscal year,” he said. Worldwide consumers had been hit with enormous increases in costs, across a whole basket of goods that included most food items and fuel. Commodity WMP had hit highs of US$5000/tonne last year up from the long- running average of around US$2000/t and this had led to the “significant burn-off of demand”, he said. Prices had stayed at record highs for longer than expected but, since the middle of the northern hemisphere summer, the drop in demand had been greater than Fonterra had anticipated when it made its payout forecast of $7/kg of milksolids (MS) for the current season.
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Dairy effluent as fertiliser
It will take a mind shift for many dairy farmers to think of cow effluent as fertiliser - not just something to get rid of, says effluent consultant Murray McEwan. He says the aim of using effluent as a fertiliser is to keep the nutrients in the top 100mm of soil. "We did see a farmer change of attitude this year at national agricultural fieldays, that indicate some are now seeing dairy effluent, not just as a cost, but also as fertiliser," he said. Most dairy farmers are driven by the need to comply with their resource consents for effluent disposal though, Mr McEwan said. But if it is done well, utilisation and financial return is the driver and compliance becomes a non-issue. On current fertiliser prices, each 100 cows produce $3000 of nitrogen, $1200 of phosphate and $2000 of potash, he said. "On an average farm now there are 350 to 400 cows. There's good money in shit," Mr McEwan, who works for the dairy effluent specialists Hi-Tech Enviro Solutions, said. more>>

Partnership will boost lambing output
Enabling NZ farmers to produce lamb year-round is the backbone of a tripartite agreement between Massey University and two Chinese institutions, but the benefits will be much greater, Professor Hugh Blair says. The partnership is between Massey, Peking University and Xinjiang’s Shihezi University, with the Chinese-Government funded project enabling collaboration to identify gene markers that enable non-seasonal lambing in selected breeds of Chinese sheep. Prof Blair says that if NZ sheep were able to breed year-round in some areas, it would be a further tool for the industry. “It’s not about changing the industry,” he says, “and many farmers wouldn’t dream of lambing out of season. But up to about a fifth of sheep farmers do have a suitable climate and providing lambs out of season would mean being paid a premium for them. The research is focusing on the Chinese Hu-Yang sheep. “We know that tropical breeds have a greater chance of breeding year-round because of course they don’t have a winter,” Professor Blair says. If NZ farmers are to adopt an intensive lambing system that requires ewes to get pregnant at any time of the year, we require access to genetics that are not currently inNZ, Professor Blair says. more>>

Dung beetle will have clean up mission
Dung beetles could be introduced within three years under a plan to improve the country's waterways and increase farming productivity.The beetles would eat their way through the considerable piles of livestock dung that currently cover pasture, making it inedible to livestock, and run into waterways during rain, killing native fish and plant species. The introduction is planned to begin in rural Rodney, and will be presented by Landcare Research scientists to the region's farmers at two meetings in the district next week. Some animal imports have become ecological nightmares, with possums, rabbits and mustelids now multimillion-dollar problems. But the dung beetles are safe, Landcare Research biological control researcher Hugh Gourlay says. Public fears are always high when any planned introduction is discussed, he says, but he has no fears of the beetle causing harm toNZ.
Even if the beetles chose to eat different dung, that would not harm the environment. The environmental benefits, though, would be significant. more>>

Semen advances accelerate gains
Hamilton's LIC, the country's largest genetic company, made their first collection and insemination of DNA-proven semen last week from technology billed as the biggest advance in bovine genetics for more than 50 years. Using science, LIC has determined how to look at a bull's DNA to enable them to identify animals with positive traits and eliminate those with less desirable traits. Traditionally farmers have had to wait at least three years until daughters of selected bulls had proven their worth. LIC general manager genetics Peter Gatley said the uptake from farmers for DNA-proven semen had been "incredible". Mr Gatley said the ability to identify elite artificial breeding sires from their DNA accelerates the rate of genetic gain enjoyed by the NZ dairy industry. more>>

Working dog sale a huge success
Farmers came from all over the country to buy dogs at the increasingly successful Whatatutu Sports Club working dog sale held at Komihana Station. The top priced dog, which sold for $3800 was a four-year-old heading dog offered by one of the district's top trialists, Howard Ingles. A total of 28 heading dogs were sold for an average of $1950. "It was a very good line-up," said Mr Patterson. In the huntaway section 38 sold for an average price of $1000. Mr Patterson said the dogs came from all over the North Island including Hawke's Bay, Bay of Plenty, Taupo. Many were from Gisborne and Wairoa. The reputation of the Poverty Bay East Coast dogs meant buyers came from all over the country and regulars of the sale, Ginger and Neil Manson from the South Island took home 16 dogs. "They turned up with a truck and then bought too many dogs. One of the locals had a registered trailer for sale so they bought that to get all the dogs home," he said. more>>

Farmers want out of costly scheme
Around 50 farmers asked the Government to exclude agriculture from the emissions trading scheme at a special meeting called in Te Aroha last night. The farmers unanimously agreed to pass a resolution which sought agriculture exclusion from the scheme, putting agriculture on an even keel with other countries. "We are asking the Government to treat NZ agriculture in the same way as our trading partners," said Te Aroha Fed Farmers chairman Stuart King. "It leaves us at a disadvantage compared to our trading partners." Mr King said many farmers were still in the dark as to what the Emissions Trading and Renewable Preference Bill, passed last week by Parliament, meant for them. It could cost them, for example, between $60,000 and $300,000, depending on the cost of carbon. "I don't think it's been decided how they are going to collect it whether it will be at the company level or the farmer level." more>>

Dairying pressure on South Canterbury land
Land use in South Canterbury is under increasing pressure as farmers continue to convert to dairying. The Clandeboye Fonterra factory has signed up 93 new suppliers this season and has a further 83 for the following year.NZ Dairies Ltd has 16 new suppliers this season. The growth of dairying has concerned South Canterbury Fed Farmers grain and seeds chairman Michael Tayler. He said arable farmers would need at least $500 a tonne for feed wheat to encourage them to stay in the industry. "As arable farmers we're concerned about losing a lot of good cropping land to the dairy industry and we feel the only way we're going to stop that is by getting good grain prices." Other feed crops such as barley would have to be about $450/ tonne for farmers to make a fair return. more>>

Warning of dairy volaltility ahead
Fonterra is telling its farmers to brace themselves for a volatile milk market this season.Chair Henry van der Heyden yesterday told delegates at a Rural Professionals conference in Christchurch that the co-op had been warning shareholders that consumers and overseas suppliers had reacted to last season's high milk prices. "We believe going forward with all the dynamics we will see a lot more volatility in the dairy market. Farmers better think about a lot more volatility with pricing and how to manage their business," he said. Fonterra, as the world's largest dairy exporter, collects 1.2 billion kilograms of milksolids to export two million tonnes of milk products. It contributes 25% of NZ's export earnings. Long-term prospects look good, with the world expected to consume another 150b litres of milk in the 10 years to 2014, with China behind one third of the growth. Within this forecast, "humps and hollows" are expected to occur. In last year's dairy boom, milk-powder prices rose from $US2000 to more than $US5000 a tonne. "Now it is going down as fast as it is going up because demand is coming off quite rapidly in the United States, and also in Japan and Western Europe," said Van der Heyden. more>>

Innovation in wool - exporter
Christchurch wool exporter says his business is proof the industry is being proactive and adding value to farmer returns.H. Dawson Farm Direct MD Keith Cowan, who is also a member of United Wool Marketers, recently hosted two groups of Australian floor retailers to promote his Pure South carpet range. The Pure South plush carpets would be launched in Australia in two weeks, and then in NZ, and he has plans to launch the Texel wool-based yarn carpets in the UK. Farmers supplied 100 tonnes, for which they receive a $1 a kg premium over the current market price.H. Dawson was aligned to United Wool Marketers, a group of merchants, brokers and exporters seeking greater promotion of wool at retail level, something they say the proposed Wool Partners International would not achieve. Wool Partners International, the result of an industry and Government-funded study into reviving the wool industry, proposes rebranding crossbred wool and linking users with growers. The wool he sourced from 50 Texel breeders and their selected clients had to meet strict specifications. It was tested for bulk and farmers were required to shear when the wool met length specifications, not necessarily when it suited them. more>>

Fonterra- this is as bad as it gets
The Chinese milk powder scandal is as bad as it gets for a food company, an emotional Fonterra chief executive said yesterday. Andrew Ferrier's comment came after China's health minister said contaminated milk formula had killed a third baby. The number of infants poisoned had soared to 6244, including 158 with acute kidney failure.The snowballing crisis was "gut-wrenching", Mr Ferrier said. Fonterra was not counting the cost of the crisis on its 43% stake in the Chinese company San Lu, which made the contaminated products. "We're not sitting here counting money, we're sitting here just making sure we do the right thing. "Fonterra wants to do whatever it can to help the situation in China. "Right now, we understand the Chinese Government has stepped in and is looking after the health of the children. "We will see ... if there's something else we can do." more>>

Rabobank/Nielsen rural confidence survey
• Rural confidence has increased dramatically in the latest survey period.• Sheep and beef farmers’ boosted expectations of an improvement in the economy.• Dairy farmers remain optimistic.
• Almost half of farmers expect incomes to rise. NZ farmer confidence has staged a dramatic improvement on the levels seen in the first half of 2008, according to the latest Rabobank/Nielsen Rural Confidence Survey.The survey – conducted across NZ last month – showed the number of farmers expecting the rural economy to improve had leapt to 59%, compared to just 18% who had that expectation back in April this year, at the time of the previous survey. The number expecting economic conditions to worsen had fallen from 37% to just 7%. Rabobank GM Rural NZ Ben Russell said improved agricultural returns and considerable falls in the NZ exchange rate were likely to have been major drivers behind the big turnaround witnessed in farmer confidence. more>>

National bank september rural report
The september report looks at where agriculture is going with an indepth look at asset values, business results and the underlying drivers of pastoral livestock agriculture. It staes that business results have not supported the increase in the value of rural land,and growth in assets have outstripped growth in income. And its worrying that agricultural exports required to service agricultural debt has doubled from 6-13% in the last 7 years. This and more>>

Flag raised over quality of water
Peter Singleton comes across as a quiet, sensible and thoughtful chap.As we sit in his office at EW's Hamilton East headquarters, he calmly details some of the findings in a report called, The Condition of Rural Water and Soil in the Waikato Region Risks and Opportunities. "The material contained in this report already exists, but often it's as discrete pieces of information. So this report brings that information together and connects the dots," says Singleton. "Concern around water and soil quality has been an emerging issue for a couple of years now," he says. "And we're getting requests from the public, and farmer groups, from our own councillors, saying `look, what is the problem with this, what is going on?'." And what is going on is serious; for decades environmentalists and agriculture sector observers have held concerns that the intensive farming of arable Waikato land is having a negative impact on our environment. Water in some streams is becoming undrinkable, and heavy use of fertilisers is causing nitrate to leach into streams. Levels of nitrogen and phosphorus have increased in many of the region's rivers in the last 10-15 years, while lakes are threatened by rising levels of nutrients draining into them from their catchments. Water quality, the report states, may well get worse before it gets better. more>>

Farmers urged to check bulls
As the breeding season gets under way for dairy cattle, farmers are being reminded to check the health status of bulls coming on to their property. The threat of TB and bovine viral diarrhoea is a concern as new stock are introduced to the herd. The AHB is offering free TB testing to commercial bull suppliers in an attempt to minimise the risks. Board northern regional co-ordinator Frank Pavitt said the risk of TB transmission from service bulls had grown significantly in recent years as dairying expansion pushed dairy support blocks further into areas prone to TB risk. The board decided on the free service after research identified the TB risk of untested bulls being trucked over wide areas in late spring for tailing off herds. Hamilton commercial service bull leasers Kay and Roger Wolfe have welcomed the board's decision to deliver on free testing for TB.He said he expected to place around 1600 bulls this season. The cost of testing for BVD is around $14 a bull. "It does cost us, but if I sent a bull with BVD out to a dairy farmer it could cost him $15-$20,000 if they ended up with 20 cows with it." more>>

Life style blocks now falling fast too
Lifestyle block sales, once the scene of busy activity for the "Queen St farmer" set, are now slumping in line with the general fall in the housing market, according to figures from the Real Estate Institute of NZ. Farm sales volumes also dropped, although medium dairy farm prices reached a record high in the three months to August. National sales volumes in the three months to August were 1,050 - down from 1,105 in July and 1,752 in the three months to August 2007. "Again the lifestyle market showed every sign of resisting the trend of the residential property market and the lifestyle median price was unchanged at $450,000," REINZ rural spokesman Peter McDonald said. "However, sales continued to decline in line with residential trends, down from 1,105 in July to 1,050 nationally to August, a big drop on the previous corresponding figure of 1,752 to August 2007."The median sales price for dairy farms continued to rise to a record figure of NZ$4.65 million in the three months to August, with the number of sales dropping to 67 in the three months, down from 89 in the three months to July. more>>

Ag R scientists have runaway show at fashion week
The AgResearch developed fabrics are: Natural Easy Care 100% wool shirting and suiting fabrics. A shirt or a suit from this fabric can be thrown in the washing machine and tumble dried. Non-Woven Windproof Fleece. It carries moisture out through the fabric to keep you dry - yet it blocks the wind coming in. Stab-resistant and flame resistant fabric. The fabric will resist puncture or knife penetration, protect from flames, is lightweight, comfortable to wear and has the benefits of the breathability and comfort of wool as well as flame resistance. Vintage Merino. This fabric has an aged and washed look, achieved through the innovative use of novel dyeing technology. Tonal dyeing. When placed in a one colour dye bath the fabric automatically dyes itself to two tonal colours – one lighter and one darker. Next-to-Skin fabric. Novel low-twist superfine merino wool yarn has all the benefits of wool but the softness of cotton and is finer than any other natural fabric on the market. Novel Knit jacketing. An innovative knit construction with versatile pattering options, which is cost effective to reproduce. more>>

Drought times set to get worse- MIA conference
Southern farmers can expect the next drought to be worse than any experienced in the past.MAF senior policy analyst Trecia Smith, who leads the climate change adaption programme, said NZ was expected to get a lot warmer this century. Farmers in the east coast regions of Otago, Canterbury and Marlborough could expect temperatures to increase by 2 to 2.2degC by 2090, she said. In extreme years, droughts would be worse than those in the past 30 years. Climate change is real and the impacts are real, Ms Smith told delegates at the Meat Industry Association annual conference in Dunedin yesterday. It's not all bad news. With the higher temperatures we would see an increase in the growing season, particularly in Southland, she said. The benefits of climate change included a shorter winter that would lead to increased pasture growth, particularly in early spring, and an opportunity to sow crops earlier. Ms Smith said there was an urgent need to develop tools and best practice to manage the effects of a changing climate. more>>

Scourer adapts to less wool
Wool Services International (WSI), which yesterday reported a "satisfactory" full-year profit, says the wool industry is facing its biggest challenge for 100 years with the change of rural land use to dairy. Managing director Michael Dwyer said the wool scourer and exporter had adopted a business model that suited the new scenario with less wool product given that it had its own marketing, procurement, processing chain and added value. There needed to be more change, but Christchurch-based WSI will not chase consolidation, he said. WSI yesterday reported a net profit of $2.39 million, down from $2.868m in the fiscal year to June 30, 2007 with last year's profit restated under new IFRS international accounting rules. more>>

Fonterra new of poisoned milk
The Govt knew nine days ago that dairy giant Fonterra's Chinese joint venture partner was selling contaminated milk since linked to the death of at least one baby, Trade Minister Phil Goff said .
Fonterra today admitted it had known of the contamination since August, and said it had urged Chinese executives to mount a public recall. But until today it did not disclose publicly information about the poisoned milkpowder, which is reported to have killed one baby and made another 432 sick with kidney damage. Mr Goff said tonight he did not believe the scandal would damage NZ's trade interests in China. "I have had the assurance from Fonterra that they did everything within their power to ensure the product was recalled and that the local authorities in the city. . . where they are operating were fully informed of that problem." Fonterra said today it had pushed for a full public recall of all affected product since learning of the problem last month. more>>

Farmers face reality check
"What are we doing to our reputation in the international market?" asks Sam Robinson, AgResearch's new chairman, when asked about the Environment Waikato report which revealed more than two-thirds of Waikato rivers tested were so dirty it was unsafe to swim, or for stock to drink from them. "NZ is credited to produce healthy, nutritious and safe food, and we clearly should be doing the same to the environment," Mr Robinson, a Hawke's Bay sheep farmer who took the reins of NZ's largest Crown Research Institute in July, said. The report, overseen by regional council soil scientist Peter Singleton, found soil and water quality were deteriorating in intensely farmed areas, with nutrient concentrations, sediment and animal faecal levels high, and warned the full effects of intensive farming may only be evident decades from now. And Dr Singleton was uncertain whether best farming practice would be enough to stop these trends in some areas. "Those best practices definitely help, but they're only one of the tools: to try to reverse these trends, we need all those tools, and new ones we don't yet have. We're finding farmers are putting on more phosphate fertiliser than they need to grow the plants." more>>

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