Dairy News 261 Jan 2012

Open Country Dairy increases payout frequency, other processors say no Page 7

computer savvy leader r&d dryer drops in

Boon for innovators Page 24

Andrew Hoggard’s world Page 29

january 31, 2012 Issue 261 // www.dairynews.co.nz

shaken and stirred Fonterra farmers frothing over proposed DIRA changes PAGES 3, 4 & 5

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Dairy News january 31, 2012

news // 3

Farmers feel ‘robbed’

by DIRA proposals PAM TIPA

Fonterra, regional councils differ on Clean Streams Accord results. PG.16

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Fertiliser ordering and tracking at your fingertips. PG.41

News ������������������������������������������������������3-19 Opinion �������������������������������������������� 20-22 Agribusiness �����������������������������24-27 Management ������������������������������� 28-31 Animal Health ���������������������������32-37 Machinery & Products ��������������������������������������38-42

FONTERRA AND the Government are at loggerheads over proposed changes to dairy regulation, both sides expressing “disappointment” over the other’s stance.

Farmers are feeling robbed and disappointed by the proposed raw milk regulations, says Fonterra Shareholders Council chairman Simon Couper.

“The Government is pursuing an idea to the detriment of New Zealand and I am not sure what the idea is. We want efficient competition and the National party espouses that but this doesn’t deliver that. There’s no successful example in economics which has a business that subsidises its competitors.

“Farmers are naturally disappointed but I think New Zealanders would be disappointed too if they understood the implications of it.”

Couper says there is no reward for consumers in New Zealand. “There’s nothing in the legislation which says they’re actually going to get cheap milk.

Because the milk goes to independent processors and half goes offshore anyway, there’s no shackle or device which says consumers will be better off.

Ultimately it erodes and fragments the dairy industry.”

But Primary Industries Minister David Carters says he is equally disappointed at Fonterra and farmer reactions as the Government listened to their concerns and acted.

“That’s why we made the change to phase out those companies which have been accessing raw milk and also have their own supply base. We have listened to the concerns and moved to make changes to the raw milk regulations and that’s why I am so surprised at the reaction of Fonterra and its shareholders.”

Carter says if the milk going to independent processors is “subsidised” that means Fonterra is not paying its shareholders a fair price for their milk. Carter says a lot of “misinformation” is being put out by Fonterra.

Primary Industries Minister David Carter is disappointed with Fonterra’s reaction.

“There’s no successful example in economics which has a business that subsidises its competitors.”

– Simon Couper The amount of milk required to be available for independent processors was set in legislation in 2001 at 5% upon the formation of Fonterra.

“The legislation was capped at 5% and the regulation was then set every year and over time the setting of regulation has not kept pace with the increased milk production in New Zealand. So the legislation is quite clear – it was always 5% to allow the formation of Fonterra.

“And frankly when the large players are no longer eligible to access raw milk I don’t think the percentage of 5% will be met again in my lifetime.”

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Ten cents was added to the farm gate price about two years ago because the mechanism allowed some independent processors to take more milk during the shoulder months. Proposed legislation would see those companies which get the full 50 million litres accessing in line with the production curve – hence the 10c is being removed.

Carter says Fonterra has the ability to be a world leader in the dairy industry but it must have some competitive pressure in New Zealand to make sure it functions efficiently.

“It would never have been allowed to be formed in 2001 unless it had the ability for government to make sure there was competitive pressure on Fonterra to perform,” he says.

“I encourage Fonterra shareholders and directors to study the consultation document – it is very detailed – then make sensible unemotional responses. We are keen to get that response, that’s why we are going through a consultation process.”

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Dairy News january 31, 2012

4 // news

Chairman’s lines running hot PAM TIPA

DAIRY FARMERS

have been phoning, texting and emailing Fonterra chairman Henry van der Heyden, expressing their disappointment with the Government’s proposed changes to dairy regulations.

“Wearing a farmer’s hat, they get up in the morning bloody early to produce exceptional milk and then they have to sell it to a competitor through Fonterra – to an independent processor, then the independent processor turns it into a product to compete against us,” van der Heyden told Dairy News.

“That’s the bit that doesn’t make sense to them. They are asking ‘how the hell that is in New Zealand’s interests?’

“They are disappointed the Government didn’t listen to their submissions. The surprise factor was $200 million more litres over three years need to go to independent processors which will ultimately be exported. It is not about the domestic market, it is about the export market.

“There are about six processors buying from us for export; four of the six have foreign ownership from outside New Zealand.”

Van der Heyden says international competitors will be laughing at New Zealand.

“The Government expects us to take all the risk and let competitors take milk from us when it suits them. It’s a nonsense; we can’t turn our cows off and on.”

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Fonterra chairman Henry van der Heyden’s five main concerns over regulation changes to raw milk to independent processors: ■■

■■ ■■

■■

■■

$200m extra over three years.

Three more years access.

Milk accessed during Fonterra’s shoulder periods.

Extra 10c/L removed from farm gate price.

Foreign ownership: no rules on who can access.

Primary Industries Minister David Carter’s reply: ■■

■■

■■

■■

■■

tive Theo Spierings says, “Handcuffing us at home will weaken our ability to compete and win overseas. It doesn’t make sense to penalise New Zealand’s home grown cooperative at a time it is bringing in more than a quarter of the nation’s export earnings.

“Why penalise the most productive sector of the economy? Farmers have taken many generations to build up something unique for New Zealand through

hard work, risk taking and building on natural advantages.”

Van der Heyden says he is sure farmers will unite around Fonterra and put submissions in, and he encourages them to do that.

Primary Industries Minister David Carter says he keeps hearing van der Heyden talk about all that milk going to foreign owned companies.

“Within three years

5% of Fonterra production has always been in legislation.

Three years could be reconsidered.

Shoulder limit introduced for bigger users.

10c removed because of new limitations on access.

No more access within three years.

“The Government expects us to take all the risk and let competitors take milk from us when it suits them. It’s a nonsense; we can’t turn our cows off and on.” – Henry van der Heyden they will be no longer eligible for that milk. Current legislation allows them to access that milk ad infinitum.”

Carter says the changes will bring about a better dairy industry for farmers

and all New Zealanders.

“This is our most important export earner; it is essential it is run in the most efficient manner possible.

“Fonterra is operating extremely well but it is a

company in such a dominant position. We need a mechanism to ensure it strives to be the most efficient dairy company in the world. That includes competition for milk prices at the farm gate.”

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Raw Milk ■■ Three-year limit on processors who access some milk directly from farmers.

■■ Fonterra raw milk available increased to 5%; currently about 4%.

■■ The October rule removed and replaced with a series

■■ ■■ ■■ ■■

of maximum quantity limits based on seasonal supply curve.

10c margin removed.

Milk Price settings Fonterra’s current milk price governance arrangements embedded in legislation.

Fonterra required to publicly disclose information about its milk price setting.

■■ Annual milk price monitoring regime by the Commerce Commission.

TAF ■■ Changes that enable Fonterra to move to its pro■■

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Dairy News january 31, 2012

news // 5

Fonterra has room to bargain - Leferink FONTERRA AND its farmers are

likely to have some negotiating power on the proposed raw milk regulations because the Government is keen to get TAF (trading among farmers) legislation through, says Federated Farmers Dairy chairman Willy Leferink.

“They want Fonterra to do TAF because there’s a bit on the back of it about share trading and share value in the document,” says Leferink.

“They want it all sorted so Fonterra can start trading among farmers from November onwards.

“They will be lucky if they meet that date. The Government is keen on TAF because it’s keen on New Zealanders having the ability to invest in Fonterra.”

Leferink says the legislation is not a done deal, because it has to go through due diligence including select committee where all the different parties will be involved Federated Farmers is used to drawnout political processes and recom-

mended to Fonterra it strengthen its lobbying in Wellington. They are likely to lobby hard to have the three years of access to Fonterra milk by existing independent processors minimised.

Leferink says farmers like start-up companies and competition. They find it important there’s opposition so that in the case of greviances they can supply somewhere else, and also it keeps Fonterra sharp.

“I’ve talked to Henry (van der Heyden and Theo (Spierings) and they welcome this competition. But they are sick and tired of big companies like Westland and Tatua using this milk for years on end for the benefit of their members without being startup companies.”

Leferink thinks independent processors should have to buy their milk straight from farmers.

Willy Leferink

‘Compete on a level playing field’ FONTERRA MEMBERS need to decide whether the proposed new regulations could impact cooperative ownership, says New Zealand Cooperatives Association president Blue Read.

“If it could threaten that, it is of grave concern. All profits Fonterra makes come back to the farmers as

opposed to the competition where they go to investors; this is something the farmers need to keep in mind.

“Is it more important our profits are repatriated to our own people or to outsiders – whatever the makeup or nationality is – should they get a legislative advantage over New Zealand farmers?”

Dairy companies should have their own supply and pay their own suppliers enough to be able to compete.

Fonterra’s milk pricing system and auction system for selling international produce are transparent, so it becomes a matter of business efficiency.

“There’s no reason other milk

Induction limit drops again ANDREW SWALLOW

IF YOU haven’t already done it, get

the bulls out, says Federated Farmers Dairy chairman Willy Leferink.

This year the cross-industry agreed limit for inductions drops again, with 4% the maximum permitted for management reasons – down from 8% last year.

Across the national herd, 2.9% of cows were induced last year “but there were some real excesses out there,” notes Leferink.

If bulls have been left in late this summer, some farms could find they have some very late calvers indeed because they won’t be able to get vets to induce more than the 4% threshold, he warns.

Where induction will be nec-

essary to keep the calving pattern tight, contact your vet early to get the process planned, he adds.

Pregnancy testing in good time to identify which cows will need inducing is essential.

“If you haven’t got a calving date profile for the herd, then forget about it. Vets won’t induce unless you know the due dates.”

The New Zealand Veterinary Association’s vet resources manager, Wayne Ricketts, reminds producers that inductions must be planned with your vet 60 days prior to the start of the process.

“Make sure you’ve identified the cows to be induced well in advance.”

Ricketts says of the 30% of farms that used inductions as a management tool last year, the average per-

centage of cows induced per herd was 6.5%.

Given that average, “some herds obviously exceeded that 8% threshold,” he notes. “But there was a significant drop from the previous year [when the limit was 15%] so we were extremely pleased.”

After this year’s 4% target, where the industry goes next is up for discussion at a meeting in March.

“There are varying views among the stakeholders as to whether we should continue the process.”

Some say up to 4% induction for management reasons – as opposed to those for animal welfare – should still be permitted, while others believe it should be further reduced, or even eliminated, notes Ricketts.

A derogation for higher levels of induction when circumstances beyond farmers’ control delay due dates, for example drought, or an AB failure due to semen quality, is another option.

Signatories to the 2010 Memorandum of Understanding on the staged reduction in inductions to date were the NZVA, Federated Farmers, Dairy NZ, and the Dairy Companies Association of New Zealand (DCANZ).

Ricketts says few, if any, countries have such a seasonal calving pattern as New Zealand, and consequently they have less need for induction as a management tool.

“The concern we have is the potential for [New Zealand’s induction rate] to be used as a non-tarrif trade barrier.”

processing companies – irrespective of their own structure or who owns them – shouldn’t be equally efficient or more efficient than Fonterra.

“If they can’t compete on a level playing field, then why should we be subsidising them?”

Read is a former Fonterra Shareholders Council chairman.

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Dairy News january 31, 2012

6 // news

Labour leader says Govt should block Crafar Farms sale PETER BURKE

LABOUR LEADER

David Shearer says the government should use its power to block any sale of the Crafar Farms to the Chinese company Pengxin International.

The Overseas Investment Office has given its recommendations on the sale to the Associate Minister of Finance, Jonathan Coleman, and the Minister of Land and Information, Maurice Williamson, who have the final say on the matter. As Dairy News went to press, it’s understood the pair were to talk to Cabinet colleagues before announcing their decision.

But Shearer told Dairy News that if the IOI recommends selling the Crafar Farms to Pengxin, Williamson and Coleman should reject that advice and see if a New Zealand buyer is interested.

Last week Shearer talked to some of the consortium fronted by Sir Michael Fay, offering $171.5 million for the

Crafar properties. The offer has been rejected by the receivers, KordaMentha. The Fay consortium consists of two local Maori trusts and four other local farmers.

“These are proven good managers of farms and we think they would do a good job.

“Labour can’t see how an outside owner who doesn’t really have any farming background can do better. We can’t see any real benefit coming to New Zealand with that type of foreign investment.” Shearer also criticises a suggestion Pengxin could buy the farms and hire Landcorp to manage them on their behalf. “We think it would be ridiculous to have Landcorp [a Crown-owned enterprise] managing the farms on behalf of foreign owners.”

The sale of land to foreigners is a big issue, says Shearer. “It cuts to who we are as New Zealanders and what we want for New Zealand. What we are looking at here is who owns New Zealand and what we want as a future.

Our feeling is that New Zealand is not for sale.”

Shearer says Labour is not opposed to foreign investment in New Zealand and says the primary sector has benefited from this and could do so in the future. But he says foreign investors should bring in something we don’t have – special expertise, a joint venture or something that adds real value.

He opposes investments

David Shearer (right) with local iwi Toby Rameka (left) and Nigel Baker at Crafer Farm in Taupo.

which generate profits to be shipped overseas.

Shearer on dairying SINCE TAKING over the leadership of the Labour Party, David Shearer says he’s taken time to learn more about the industry.

He has talked to Fonterra managers and visited the co-op’s research facility in Palmerston North.

He is impressed with what he’s heard and seen and says the future for dairying “is exciting.”

“My message to dairy farmers is we want to see the best for farmers and New Zealand.

Labour is often portrayed as anti-farming, but that’s not true.

We very much want to engage in a dialogue with the sector, find out the issues and work alongside farmers to make the dairy industry as successful as possible.”

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“We oppose foreign ownership of farmland unless we can see added

benefit to New Zealand as a result of foreign owners coming in.”

Out-of-court settlement PETER BURKE

LAWYERS FOR the Sir Michael

Fay-led consortium seeking to buy the Crafar Farms have settled out of court to obtain a copy of the Overseas Investment Office (OIO) recommendation on whether or not the 16 North Island properties should be sold offshore.

Consortium spokesman Alan McDonald says there was a risk that a final decision could be made without anyone receiving the information needed to launch an effective judicial review of the decision.

“There was also a risk ministers could make a decision prior to the January 31 deadline set by receivers KordaMentha, without announcing it publicly until after a sale of the properties was completed.”

This decision to give the OIO report

to the Fay Consortium, and their legal moves, suggests the OIO has found in favour of Pengxin buying the farms.

The decision of the ministers concerned was expected at the end of last week.

Dairy News understands Team Fay believes the OIO decision is legally flawed, likewise the ministers’ decision, hence their move for a judicial review.

While January 31 was the date set for the Pengxin offer to go unconditional, it’s understood the Chinese will not sign the final agreement until legal arguments have been settled.

Meanwhile a spokesman for Pengxin, Cedric Allan, says they are not getting involved in the legal issues unfolding in Wellington. He says they are awaiting news of the OIO and ministers’ decision and if it goes in their favour, will settle the deal with the receiver. He says they are confident and optimistic.

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“Waikato is the agribusiness

heartland,” Rowarth says. “It is close to the headquarters of Fonterra, Ravensdown, Ballance, TruTest and Gallaghers among others, and the university does a lot more with agribusiness than people realise.

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Dairy News january 31, 2012

news // 7

OCD payout frequency rises PETER BURKE

OPEN COUNTRY Dairy (OCD) is to increase the frequency of its payments to its farmer suppliers, but investigations by Dairy News suggest that in the short term at least, none of its competitors will follow suit.

OCD chairman Laurie Margrain says that since its inception eight years ago the company deliberately set out to be different from other players in the dairy sector.

“We wanted to take a different approach, to be innovative and pushing productivity gains.

“Also how we paid and incentivised farmers.”

Margrain says OCD paid its 500

suppliers a surprise $40 million in December and plans to pay them before the end of May for milk received in November; this is on top of normal advance payments. OCD plans eventually to make quarterly payments to its suppliers.

“Listening to farmers, one of the pressing issues they have is the delay in the proceeds of their milk being returned to them.... Farmers supply the first of their milk on June 1 and they get paid for the last of that June milk in October the following year.

“We said three years ago that we’d return this money much earlier and without any risk of claw backs later on,” he says Margrain says OCD has talked to rural bankers and they’ve all

reiterated that this new system would be highly beneficial to their clients and to rural communities.

It will result in the trickle down of money and reduce the need for costly overdraft facilities.

Margrain insists there are no financial risks to OCD. “Once you’ve processed the milk, shipped it and been paid for it – knowing the value for that period – why should it not be paid back to the supplier base.

“After all it’s their money and doesn’t belong to the processing company.”

He describes the move as a big paradigm shift and wouldn’t be surprised if other companies ultimately follow suit.

Open Country Dairy has increased the frequency of payout to suppliers.

Others says no IN THE short term, at least, it’s unlikely other dairy companies will follow OCD’s lead. Fonterra has said no, so have Westland Milk Products and Tatua Co-op.

Tatua chief executive Paul McGilvary told Dairy News they operate the same system as Fonterra and don’t plan to change that as it works well for them.

“We do quarterly forecasts of our financial position and on the basis of those forecasts we prepare an advanced schedule for our suppliers giving them certainty about what will be paid each month for their milk.

“That schedule is updated as we update the forecast. At the same we give them the advanced schedule we also give them an estimate of where the final might be so they can

plan for what the top-up might be.”

McGilvary says as the year progresses the advance payment generally starts to lift towards the figure of the final payout. In the last month there will always be some uncertainty given the volatility of the dairy markets.

The present payout system at Tatua works pretty well and the co-op has no plans to match the OCD proposal.

Westland Milk Products (WMP) chief executive Rod Quin says they will stick with their payout system and not match OCD’s system.

Like Tatua, WMP starts the season with a modest payout and steadily builds on this as the season progresses.

“We tend to start by paying

65-70% of our initial forecast for the year. Then as we sell product and are certain about the returns and the value of the milk, we start to lift the milk cheque and at the end of the season there is a final wash-up payout.”

Quin says the driver for WPM and Fonterra making their final payout in October is the need to get their financial position absolutely right.

“You finish the season at the end of the July. You then have to prepare a set of audited accounts and that takes you through into August.

“By September the board is approving the final financial position of the company and therefore in October you can afford to pay the final retrospective payment.”

Price drop ‘won’t affect payout’ DROPPING OF wholesale milk

prices to New Zealanders will have little impact on farmers’ earnings, says Fonterra.

The drop will not be huge but a standard dip, in line with the movement of international commodity prices, a spokesman told Dairy News.

The dairy coop announced publicly earlier this month it would cut wholesale milk prices at the end of January, but would not comment on the extent of the cut.

It would be up to retailers whether

the price decrease reached consumers.

Supermarket chains Foodstuffs and Progressive have indicated they will pass on the price cut.

The move was flagged late 2011

by Fonterra chief executive Theo Spierings, who announced the Milk for Schools programme.

“Traditionally milk consumption in New Zealand has been increasing about 1-2% but it is currently declining by a similar rate,” he said. “We are exploring a range of options to

turn around the consumption decline by making milk more consistently affordable.” Fonterra would report back in the first quarter of this year, he said.

In February 2011, Fonterra froze the wholesale milk price for the rest of the year, to shield New Zealanders from further increases in international prices.

Any further changes to the wholesale price in New Zealand would now be dictated by international price fluctuations, Fonterra has said.

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Dairy News january 31, 2012

news // 9

Irrigation scheme has potential for dairying PETER BURKE

THE AMOUNT of irrigated land in Hawke’s Bay could increase from 6000ha to 20,000ha if a proposal to create a new irrigation scheme in the region finally comes to fruition.

The scheme could have big benefits for dairying in the region. At present about 18,000ha is used for dairying, but potential exists for this to double, says Hawke’s Bay Regional Council (HBRC), the first successful applicant for the Government’s Irrigation Accelerator Fund, designed to develop irrigation schemes around the country.

The scheme, run by MAF, will put in $1.67 million and HBRC a further $4.8m to study whether the Ruataniwha Plains Water Storage scheme is feasible and commercially viable.

This involves constructing a 77m high dam on the Makaroro River.

The proposed dam would be capable of storing 90 million m3 of water for irrigating 17,000-22,000ha, subject to land use, effectively doubling the irrigated land in Hawke’s Bay. It also has hydro-electricity potential of 6.5MW. The region has problems with water quality, sustainability and overallocation of water. HBRC chief executive Andrew Newman says the pro-

posed dam would see irrigation takes moved to stored water which in turn would have a positive downstream effect for the Tukituki River.

This would improve water quality and allow greater flow in the river during summer. The dam would provide greater security to existing and new irrigators.

Central Hawke’s Bay hill country farmer Sam Robinson, chairman of the Ruataniwha Water Storage Project leadership team (also chair of AgResearch) told Dairy News he is impressed with HBRC’s moves to deal with the problems.

“They have taken a bold step by investing a lot of money to get the irrigators off the rivers and restore them to their natural flow. Water storage is such a simple common sense solution. In many ways Hawkes Bay is just a mini Canterbury.” Robinson says if the scheme goes ahead it will have huge economic benefits for the region.

Officials are quick to point out that other land users could benefit as much as, or more than, dairy farmers. Croppers and commercial growers are said to be eyeing the benefits.

Federated Farmers also praises the initiative.

Bruce Wills, provincial president of Hawke’s Bay, says HBRC deserves a “pat on the back” for what they

have done. “If it comes off it’ll be big for the Bay and big for New Zealand.”

While no final costing has been done, one estimate puts it at $180m.

The feasibility study is due to be completed by June. If the study proves positive the HBRC will

A new irrigation scheme has been launched in Hawke’s Bay.

move to design work, seeking consents and obtaining funding from a variety of sources. The Government has already set aside $400m for this purpose and HBRC could apply for a grant. MAF says other irrigation proposals are being considered.

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Dairy News january 31, 2012

news // 11

Grazing costs set to increase in Southland SOUTHLAND DAIRY

farmers could pay more for winter grazing this season on the back of poor crop growth and a shortage of suppliers.

While farmers and graziers told Dairy News they were reluctant to discuss prices for this winter, there is widespread agreement grazing is likely to be costly. Farmers last year paid up to $28/cow/week,

three in front of it; anyone who hasn’t got a contract will be paying that.”

Improved sheep farming returns have also compounded the lack of dairy grazing availability.

“Lots of farmers who’ve put in a paddock of brassicas in the past won’t be doing that this season.

It’s likely to be an on-going problem in Southland.

As the difficulties in the sheep industry improve there’ll be a lot of farmers who go out of dairy graz-

he’s hopeful more rain will boost winter crop growth in the weeks to come.

“I hope everyone’s rea-

sonable in their winter grazing expectations and prices don’t get out of hand.”

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“If we don’t get rain in February we’re in real trouble. Crops will definitely be back on previous years.” – Hamish Ryan but this year there are indications pre-negotiated grazing contract rates may hit $30, and spot grazing prices even more.

DairyNZ estimates crop yields in Southland could be down as much as 30% in the wake of recent drought, and northern Southland grazier Hamish Ryan agrees winter crop growth has been hit hard.

“If we don’t get rain in February we’re in real trouble. Crops will definitely be back on previous years.”

As a result, he says, grazing in Southland will be at a premium, with some dairy farmers possibly forced to truck animals north for winter feed.

“If I was a dairy farmer and I didn’t have grazing secured now I’d be quite concerned.”

Ryan has already cut his winter grazing numbers. He usually winters up to 5000 stock; this year it will be 2000. “We’d be 50-60% down on what we’d budgeted for grazing, but we’re being cautious because we want to be able to feed the cows.”

While reluctant to talk prices, he suggests a “price correction,” is needed in Southland – perhaps winter grazing on the open market costing about mid$30/cow/week. “Realistically there’s got to be a

ing.”

Southland farm consultant Jack Ballam agreed grazing prices and availability would be “very tight and very expensive.”

“It’s all about integrity and people need to form long term relationships with their graziers.”

However, he says farmers also need to be realistic. “Good grazing at $32 is cheaper than poor grazing at $30. Farmers need to look at the best cost options for their cows and they may need to review their stocking rates for next season.”

Federated Farmers Southland dairy section head Russell Macpherson says if farmers want sustainable, good quality winter grazing they “may have to bite the bullet to ensure good production next year. It hurts when the grazing bill goes up, but everyone’s costs have increased.”

However, there was still plenty of the growing season left, he says. “It’s still early days and you’ve got to think positively – that things are going to come right.

“Southland’s a good place to farm and things tend to even out; if we have a dry summer, we’ll get a good winter.”

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Dairy News january 31, 2012

12 // news

‘Meeting to allay TAF fears’ PAM TIPA

CONCERN ABOUT ownership and control will be uppermost in dairy farmers’ minds this week as they attend TAF (trading among farmers) meetings around the country, says Fonterra Shareholders Council chairman Simon Couper.

The cooperative will present options addressing concerns about some aspects of TAF at about 60 meetings.

“Farmers are going to want to see that concern about ownership and control is allayed – the return of ownership and control,” Couper told Dairy News.

The Shareholders Council was to have met last week with Fonterra management to review a number of options including legal title staying with farmers – one proposal put forward by Fonterra chief executive Theo Spierings in a preChristmas Sky TV interview.

Couper says the council will have a more concrete view of its position by the end of February after the farmers’ meetings have been held.

“The shareholders council will have a lot of things to review. There are more than a dozen things we need take into

“Farmers are going to want to see that concern about ownership and control is allayed – the return of ownership and control.” account with respect to whether or not, at the end of the day, we are going to maintain the cooperative we have now.”

Fonterra chairman Henry van der Heyden said in the Sky interview that TAF remained on track for introduction in November 2012 but acknowledged the concerns of some about the proposed custodian.

Spierings says three options – the current custodian proposal, a second option that offers important changes to the current proposal, and a third option which gives legal title to farmers – would be worked through and taken to the board of directors in January, before being discussed with farmers at the round of meetings.

He says there was no intention of the shareholders’ fund getting anywhere near the 20% limit. “We have talked about $500m; that is 8% and much closer to the mark. It is likely to sit somewhere between 7 and 10%.”

Meanwhile Fonterra says several independent expert advisors are looking

at TAF to ensure the scheme preserves 100% farmer control and ownership.

A due diligence committee of Fonterra directors is responsible for reviewing the design and implementation of TAF, and checking that all the preconditions on which shareholders voted can be met, says van der Heyden. The committee will produce a series of reports to the board on TAF progress, ensuring it stays true to the intent of the cooperative.

“A particular focus of the committee will be to ensure the market is deep, liquid and readily available for farmer shareholders to buy and sell shares when they want. Another focus will be DIRA.” The chairman of the board’s capital structure committee, John Wilson, has worked with management to attract a high calibre of international and New Zealand advisors to ensure the model is thoroughly tested. They include: • Professor Michael Cook, Missouri University, USA, an expert on co-oper-

Simon Couper

atives.

• Alan Galbraith, QC, expert in constitutional, commercial and securities law.

• Murray Gough, former chief executive, New Zealand Dairy Board.

• Paul Oldfield, director, corporate law firm Harmos Horton Lusk.

• Eric Lucas, partner, PricewaterhouseCoopers.

• Colin Giffney, board member, Financial Markets Authority, and deputy chair, Takeovers Panel.

in brief Farmer confidence slips FEDERATED FARMERS mid-season Farm Confidence Survey, conducted last month, reveals farmer confidence in the general economy has turned negative for the first time since July 2009. Europe and the global economy increasingly weigh upon farmer outlook, it says.

“While farmers are confident in their own businesses, there’s been a big deterioration in the global economy since July, when the 2011/12 season began,” says Federated Farmers president and its economics and commerce spokesperson, Bruce Wills,

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Dairy News january 31, 2012

news // 13

Salmonella hits Naki cows PETER BURKE

A TASKFORCE has been set up to continue investi-

gating a serious outbreak of salmonella in dairy cows in Taranaki.

The New Zealand Veterinary Association (NZVA), DairyNZ, Fonterra and MAF are working together to find out why this has happened and what to do about it. There have also been problems over the last 2-3 years with salmonella in cows in Waikato, Bay of Plenty and Canterbury.

Salmonella is not uncommon in dairy cows in New Zealand, but it’s the extent of the problem in Taranaki in the past few months that has vets concerned.

Roger Marchant, NZVA, told Dairy News what’s unusual about the situation in Taranaki is a greater number of cases than would normally be expected.

He says this disease is a serious setback for individual farmers because in some cases 30-40% of cows in a herd are infected. The disease results in lower milk production and sometimes death.

“It’s a serious problem for individual farmers, and in the case of the whole dairy industry any increase in a disease might cause people to wonder what might be going on. The concern also is that salmonella is a human health risk and people can be infected by sick cows. The biggest risk is to farmers and their families.

“Attention to simple personal hygiene is needed, such as washing hands, and wearing protective clothing when handling sick cows. Smoking in the dairy shed for example would be a no no. The milk from infected cows can used if it is pasteurised, and companies have excellent MAF approved food safety programmes,” he says.

In the past, salmonella has caused the deaths of individual cows in herds, but in the recent outbreaks vets are reporting there appears to be more cows affected in herds but fewer deaths of cows.

Salmonella is spread by ‘fecal-oral’ (i.e. bacteria passed out in faeces contaminating feed and water) and is a waterborne disease. This means it could be spread through effluent being pumped onto paddocks, or if it gets into a drain, stream or a waterway it has the potential to spread quickly.

Marchant says the best way of dealing with salmonella

on a farm is to get early identification of clinical cases.

“If a farmer spots a cow off its milk, off colour, not eating, or scouring, get the vet in immediately for a diagnosis. They will recommend isolation and treatment of clinical cases and protection by vaccination,” he says.

Vets in the Taranaki region have been alert over the problem and farmer and vet meetings have been held to brief farmers on the disease and how they should deal with it. He says a Taranaki survey has been done by Massey University to find out more about what is happening and what the causes might be.

A taskforce has been set up to investigate an outbreak of salmonella in Taranaki.

in brief Dairy women scholarship THE DAIRY Women’s Network is teaming up with Fonterra to offer New Zealand’s first annual ‘Dairy Woman of the Year’ award.

The winner will be awarded a position on the prestigious Women in Leadership 12 month course run by Global Women. The scholarship, valued at $25,000 is sponsored by Fonterra Milk Supply.

The Women in Leadership course begins in September 2012 and will give the recipient 12 months of exposure to “globally focussed” women in leadership roles across the business sector. Presenters include Dame Jenny Shipley and others of her calibre.

Dairy Women’s Network chief executive Sarah Speight says the purpose of the award is to profile and celebrate women making a difference in the dairy industry, their dairying businesses and their communities.

“This award will recognise a woman demonstrating exceptional leadership in the dairy industry. But, it’s not just about recognising one woman out of the thousands who are doing great things.

“Rather we hope the award encourages many more to get involved and make a difference in our industry, while also making a positive impact on-farm and in the lives of people in their rural communities.”

Fonterra general manager milk supply Steve Murphy says it is committed to supporting education in the dairy industry.

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Dairy News january 31, 2012

14 // news

Big dairy farms in demand BIG-FARM DAIRY is among the winners in a steady climb of the rural property market, says PGG Wrightson Real Estate general manager Stuart Cooper.

The bigger farms were more impacted by the downturn, but are getting the biggest benefit with the recovery.

“With dairy you have got the return of the big farm market.” Cooper says. “There was very little

Buyers are more going on a year ago; now disciplined it is starting to and business pick up again. orientated.

That has a “People are big effect on doing their Canterbury, homework; they Southland and are bringing Waikato where in advisors most of the big and have a lot farms are.”

Stuart Cooper more equity.

All sectors Before it was and areas are sometimes no equity at all. recovering steadily to the most positive level in four There’s strong focus on fundamentals, cash flow years but it’s “nowhere and those sorts of things.” near a boom.”

Dairy is seen as a good business investment. “The fundamentals for dairying are good, the outlook is good and it’s a good investment particularly when you start comparing it to a lot of other things.

People learnt a lot about what happened after the global financial crisis. And people have changed their approach and adapted to a brave new world. “ Farmers and farmer groups in the market

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Cooper says he is seeing a balanced market where neither buyers nor sellers are holding the upper hand.

Real Estate Institute rural market spokesman Brian Peacocke says demand for top dairy farms is outstripping supply, helping to underpin prices.

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FIFTY DAIRY farms were among the 353 farms sold in the three months to the end of December 2011, says REINZ. Sales of all types of farms were up 65.7% – 140 more farms – for those three months compared to the same period the year before.

For the three months to December the median sales price per hectare for dairy farms was $37,045 compared to $36,766 (50 properties) for the three months ended November 2011 (27 properties) and $35,074 (43 properties) for the three months ended December 2010. The median size for dairy farms sold for the three months ended December 2011 was 141ha.

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this summer taking a leaf out of the Waikato’s book and organising an effluent expo of its own.

Over 30 effluent equipment or service providers will next month exhibit their wares at Canterbury Park, Christchurch, in what will be the South Island’s first effluent expo.

“The aim is to get all the suppliers of products and services to do with effluent management, storage and distribution together so users can visit them and talk to them all in one place, in one day,” South Island Dairy Development Group executive director Ron Pellow told Dairy News.

“Then visitors can go home and plan so they can make more informed decisions about effluent management.”

SIDDC is one of nine parties involved in the Canterbury Dairy Effluent Group, the others being

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“So it’s quite a significant body of people. We’re all in this together working towards full compliance and good utilisation of effluent.”

Seeing the success of Waikato’s inaugural event last year, the group decided something similar in Christchurch would benefit Canterbury producers, he adds.

Environment Canterbury commissioner and dairy farmer Tom Lambie says new regulatory requirements in ECan’s natural resources regional plan, and last year’s release of the industrywide Effluent Design Code of Practice and Standards, make it “a timely event.”

“The willingness of suppliers and industry to work together to deliver compliant and practical, economical solutions

on-farm is evident in the number of exhibitors supporting this.

“There’s a lot of industry expertise out there on a variety of [effluent related] issues and this will bring it all together in one place, at one time,” he told Dairy News.

The Canterbury Expo is in the Riding for the Disabled building, 10am4pm, Feb 20. Entry free for farmers.

Meanwhile the Waikato event is on again at Mystery Creek with at least 40 exhibitors, up from last year’s 25, says organiser Waikato Regional Council and sponsor DairyNZ. “We’ve encouraged more exhibitors to come to provide farmers with the ability to see a wider range of effluent solutions, which they can match to the unique circumstances of their farm,” says WRC agriculture advisor Kate Ody. Waikato’s 2012 Effluent Expo is February 28, 9am to 3.30pm.

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Dairy News january 31, 2012

16 // news Fonterra and regional councils are at odds over the success of the Clean Streams Accord.

Stream accord ‘work in progress’ – councils BARBARA GILLHAM

THE SUCCESS of the

Clean Streams Accord is in question following discrepanccies between claims made last month by Fonterra of its success and the findings of an inde-

pendent review commissioned by MAF. The Accord ‘Snapshot of Progress’ claims 84% of Fonterra dairy farms had achieved complete stock exclusion from Accord waterways.

While this has raised questions over the suc-

cess of the Accord and the self reporting it relies on, councils say they are working hard to have all waterways fenced off and meet required targets and that most believe dairy farmers in their respective regions are keen to comply.

Tess Dacre, monitoring manager of water and waste, Northland Regional Council, is upset with reports she has seen describing Northland farmers as the “dirtiest in the country”.

“I don’t believe that is the case. Northland farmers have invested hugely in effluent and the council is working hard to achieve 100% compliance; but we’re not there yet.

“In Northland we have 950 dairy farms and we inspect each farm annually. Dairy effluent is a big part of our monitoring and we are always looking at ways we can improve compliance. There’s a mixed attitude among farmers, as with any cross section of the population; some are good about it and diligent but others don’t care.

“It’s difficult when all the regions are put on a table. Of course people are going to compare them and it makes it hard. There are differences in how each council monitors farms and each has different rules. Some regions monitor every year and some don’t so I don’t like to see headlines describing our farmers as the ‘dirtiest’. It’s the same across

the country; it’s just the numbers and the way things are done; we’ve still got a little way to go”.

Marlborough District Council officer Shelley Lines describes compliance of the Clean Streams Accord as a “work in progress”.

“We are obviously pushing to have all waterways fenced off and are making good progress.

In the region there are 61 dairy farms which I inspect annually; to date I have visited probably half of those. Of those farmers I have spoken to, 75-90% have fenced their waterways.

“We have some issues regarding historic effluent ponds near waterways... so our focus is to do with the effluent discharges we are working on. We are making good progress; sometimes with the measures there are it may not look that way but it is happening. [On December 26, 2010] we had severe floods that wiped out a lot of fencing in Canvastown and the Rai Valley area. That cost farmers a lot to reinstate and set them back on other work they would have achieved in other areas, plus there are other elements such as some being in high rainfall areas, but I am confident we are getting there.

The Fonterra target was to have 90% of waterways fenced by the end of the dairy season of 2012 so we are not quite there yet.”

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THE 2010-11 Clean Streams Accord snapshot results released last month indicated Fonterra’s 10,500 farmers were heading in the right direction. The snapshot stated dairy cattle were now excluded from Accord type waterways on 84% of dairy farms, a figure questioned since the release of an independent review commissioned

by MAF that reduced that figure to 42%.

Results showed 90% of stock crossings requiring bridges or culverts had been achieved and some progress had been made toward the Accord target of 100% full compliance with regional council dairy effluent and consent conditions. Nationally according to the snapshot the level of full compliance had increased in 2010-11 to 69% compared to 65% for 2009-10.

Nationally the average level of non-compliance with regional council dairy effluent rules and consent conditions had decreased from 16% in 2009-10 to 11% in 2010-11.

The snapshot showed 46% of dairy farms now had a nutrient management plan in place and 99% also have a nutrient budget.

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18 // world These young heifers at Fonterra’s Hangu farm are now part of the milking cows at Yutian.

Fonterra’s second China farm up and running PETER BURKE

FONTERRA HAS just

commissioned its second dairy farm in China and begun work on a third farm. The new farm is per-

forming ahead of expectations, says the man in charge of the co-op’s overseas farming ventures, Peter Moore.

He told Dairy News production is up 4-5% on expectations. Minor

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is in the milking parlor. teething problems had The pilot farm is simioccurred, but nothing lar to an average herringmajor. “Animal health has bone shed in New Zealand, been particularly good.” while the parlor at the new The newly commisfarm looks more like those sioned farm, Yutian One, seen on American feed-lot is in Herbei province near farms.

Beijing.

“At the new farm there Moore says the farm is individual cow identificurrently has 1000 cows cation, allowing individual and mature heifers in milk and another 900 due production data off each cow, which you can’t do to calve in the next two at the first farm. months. “We This enables us to hope by this time make better decinext year to be sions about which milking 3000cows are going to 3200 cows. If you perform best in take into account the system. It also the young stock Peter Moore means we can tell and supporting how much milk stock we’ll have about 5500 animals on the each cow is producing and the return we’re getting farm.” on the feed we’re giving Changes have been made to Yutian One, based them.”

The cows, run in mobs on what was learned from of 200 at Yutian One, all the first and pilot farm at have electronic collars Hangu which is similar in and the data from each size. animal is fed into a cenAbout 2800 cows are being milked there but the tral database. Moore says setup is different from the they could have put in more sophisticated technew farm. nology, but the data being “I’d expect the new collected now is a huge farm to perform signifimprovement on what icantly better than the happened at the pilot pilot. This improvefarm. ment is based on what Yutian One employs we learned from the first about 100 local people. farm. The start-up has Local farmers are conbeen smoother and milk tracted to grow maize production per cow has silage which is a major been quite a bit higher. feed component for the We’ve got better systems and processes on this farm farm.

The third Fonterra which enables up to monitor cow performance a lot dairy farm, 7km from the second farm, is due to more closely,” he says. be commissioned by late One major difference October. between the two farms

New content loaded daily www.dairynews.co.nz

Dairy News january 31, 2012

world // 19

Robert Wiseman is being sold to a German dairy producer.

Processor eyed by German yoghurt maker ANDREW SWALLOW

THE UK’S largest fresh milk sup-

plier, Robert Wiseman Dairies, looks likely to be bought by Germany’s Theo Muller Group.

Privately-owned yoghurt specialist Muller already leads the UK market in that sector and will pay £280m ($NZ540) for Wiseman which supplies nearly a third of the fresh milk market.

Muller’s bid of £3.90/share for Wiseman came to light when RWD shares surged on the London sharemarket earlier this month. The shares were £5/share in 2010 but a profits warning prompted by supermarket price wars on fresh milk saw the stock crash to just above £3/share in September that year, where it more or less held until the last quarter of 2011 when it slid to £2.50/share.

RWD has recommended shareholders accept Muller’s offer and several large Wiseman stockholders, including some founding family members, are reported to have done so. However, as Dairy News goes to press, there are no reports Muller has secured the 75% of Wiseman stock necessary to delist the company from the London Stock Exchange.

UK producer body DairyCo says if the deal goes through, Muller will

‘A new and exciting phase’ UK DAIRY farmers Mansel Raymond says the UK dairy industry is entering into an exciting phase in its evolution with farmers now looking to make investment decisions.

“It is important that the processors and the supply chain now work to grow together as farmers will be looking to build long-term, trusted relationships which includes fair pricing and transparent terms and conditions.

“We will be looking to Muller and to Wiseman Dairies to build on these foundations in whatever comes out of the current takeover bid.”

Müller chief executive officer, Heiner Kamps describes it as “an exciting strategic move” by Müller to enter a new market segment in the UK. “The combination of these complementary businesses will form a leading dairy player offering a range of exceptional products to our customers across the UK. “This will create significant opportunities which will benefit suppliers, customers, consumers and employees. We look forward to working with the experienced Wiseman team and combining our complementary skills and extensive experience in the dairy industry.”

process about 19% of Britain’s milk output, based on 2010/2011 figures.

RWD has contracts with most of the major retailers for own-label milk, a sector where processor margins have been squeezed, it adds.

Bavarian-based Muller was formed in 1947 and is privately owned. While the group’s core business is dairy, it is involved in other food sectors in Europe.

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According to its website Muller companies employ about 16,000 and, before the Wiseman takeover, had an annual turnover of about Euro 3.5billion ($NZ5.65 billion).

Wiseman was established in 1947 as a small milk run from the family farm in East Kilbride. The London Stock Exchange lists Wiseman’s revenue for the year to April 2011 at £917m returning a profit of £34.4m.

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AUSTRALIAN DAIRY processor

Warrnambool Cheese and Butter is joining forces with supermarket chain Coles to create a new dairy brand.

The new brand, Great Ocean Road, exclusive to Coles stores, will comprise high quality cheeses and fresh milks. The brand will launch in Coles with tasty, extra tasty, vintage and light 500g cheddar cheeses, and a tasty and light 500g shredded cheese. The fresh milks will include full cream, light, skim and flavoured.

WCB chief executive David Lord estimates the Great Ocean Road partnership with Coles will see it source

an extra 50 million litres of milk from dairy farmers each year for the five years of the contract.

“This is the start of a new strategic relationship good for Coles and for WCB. With this five year deal, WCB continues to build its consumer branded business.” It requires extra production requiring new investment and bringing new jobs to the region, Lord says.

The brand pays tribute to WCB’s history in the region. “WCB has been based at Allansford on the Great Ocean Road for over 120 years. This new brand brings that provincial story

to customers, with a quality, value dairy range.”

The range will be available in Coles stores from early May, with the milk range available in Coles stores across Victoria.

Coles merchandise director John Durkan says the five year partnership with WCB is further evidence of its commitment to support local Australian dairy processors. “We’re pleased to bring this new, wholly Australian dairy range to consumers. WCB is an outstanding Australian dairy producer with a pedigree stretching back over 120 years.”

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Dairy News january 31, 2012

20 // opinion OPINION Ruminating

EDITORIAL

Proposed DIRA reforms a step backward

milking it...

Muldoonism back?

THE GOVERNMENT’S proposed restructuring of DIRA has an ominous undertone, particularly on milk pricing.

In fact it has more than a hint of price fixing about it. It would not be a good look for a National government to go down this road, although it does have this sort of socialism in its heritage. Are we looking at a return to Muldoonism?

PR battle THE FIGHT over the Crafar Farms has more twists and turns than a John le Carre novel (e.g Tinker Tailor Soldier Spy).

Not only have we seen Michael Fay change suddenly from a major stripper and seller of New Zealand assets to become a cheerleader for keeping it Kiwi. Now we’ve got the PR hacks swooping over the corpse of the Crafar deal.

Former colleagues and founding partners in Auckland PR firm Star PR – Alan McDonald and Cedric Allen – are now on opposite sides of the fence, with McDonald championing Fay’s cause and Allen running the Chinese buyer’s campaign.

Obama milk joke backfires PRESIDENT BARACK Obama can’t tell a joke to save his life. During his recent State of the Union address, Obama told the milk joke: “We got rid of one rule from 40 years ago that could have forced some dairy farmers to spend $US10,000 a year proving they could contain a spill — because milk was somehow classified as an oil. With a rule like that, I guess it was worth crying over spilled milk.”

This was followed by a muffled lowing sound like cows dying. Slowly, painfully, it blossomed into applause. He just doesn’t cut it, does he.

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Milk war

ISSN 1175-463X

WHILE AUSTRALIA last week fired its barbeques and toasted Australia Day, dairy farmers noted the one-year anniversary of the brutal retail milk price war, and its disastrous impacts over the last 12 months, on top of the severe impact of the natural disasters that savaged Queensland dairying regions.

Queensland Dairyfarmers Organisation president Brian Tessmann says last Australia Day was when Coles announced it was slashing its supermarket brand milk to $A1/L – seen by farmers as the ultimate un-Australian act.

The announcement also dragged other retailers into the battle, devaluing fresh milk overnight across the country. The price war continues one year later.

THE GOVERNMENT’S proposed changes to dairy industry regulations are plain wrong. They are a kick in the guts for Fonterra’s 10,500 hardworking farmers.

The Government is adamant the changes will reduce milk prices on supermarket shelves and boost competition in the dairy sector. Sadly, the Government is wrong on both counts.

By forcing Fonterra to provide more subsidised milk to competitors, the Government is only making life easier for foreign investors in the dairy sector.

They all buy raw milk from Fonterra but none of them puts milk on the domestic market. They turn cheap milk from Fonterra into exports with some profits they make ending up offshore.

These companies can also buy milk on the ‘shoulders’ of the season – not just the peak season – at which time its more valuable.

In essence the Government wants subsidies to continue for competing companies at a time when Fonterra itself is being asked to reduce the cost of milk to New Zealand milk consumers.

It’s unfair to expect Fonterra to continue subsidising other processors and keep milk prices down at the same time.

Is Fonterra the only player involved in retail milk pricing?

What about the supermarkets? Ensuring price reduction would also require keeping control of the cosy supermarket duopoly, which arguably has more influence over the retail price of milk than Fonterra.

The fundamental issue is that Fonterra is a legal monopoly, dominating an economy in which the free market is supposed to rule.

There are very good reasons for keeping New Zealand’s dairy industry unified, as any comparison with the structure and performance of other agricultural sectors shows.

Fonterra accepts the need for regulations to ensure fair competition.

But singling out Fonterra is not the way.

Right now it seems this Government is determined to assist privately-owned dairy companies at the expense of the locally-owned cooperative. This is plain wrong.

– Sudesh Kissun

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Dairy News january 31, 2012

opinion // 21

DIRA changes defy logic SIMON COUPER

GOVERNMENT LEGISLATION forcing Fon-

terra farmers to further subsidise increasingly foreign-owned competitors would be a debilitating blow to all New Zealand.

Under the proposed changes announced last week, Fonterra farmers would be obliged to provide an extra 200 million litres of milk to competitors at a cheaper price from the 2012-13 season.

The proposal defies logic. There is no successful example in economics where a business is forced to subsidise its competitors.

Furthermore, the Government provides no guarantee the extra milk proposed to be made available to competitors would bring benefits in the form of cheaper milk to the New Zealand public or that the profits generated would remain in New Zealand.

Based on 2011-12 projections, no more than half the available 600 million litres of milk Fonterra farmers supplied to other processors this season will make it to the New Zealand domestic market. About 300 million litres (53%) is forecast to go to independent processors who primarily export product overseas. Of that 300 million litres, twothirds is claimed by processors with some level of foreign ownership.

It makes no sense to take money out of New Zealanders’ pockets to

line those of foreign companies who take our resources and give nothing in return.

Less than six months ago close to 1500 Fonterra farmers presented submissions to MAF seeking changes to ensure the obsolete raw milk regulations worked as initially intended.

The suggested threeyear finish is theoretically a good step. But how can farmers trust that in three years this aspect won’t be changed, given that last year the minister assured farmers there would be no increase to our 600 million litre DIRA obligation?

It is important to remember that Fonterra Cooperative is not seeking to insulate itself from competition. Competition is good for our co-op as it ensures we stay lean and efficient.

However, the Government’s legislation proposes New Zealand farmers subsidise increasingly foreignowned, established processors who do not need DIRA milk to compete while doing little or nothing to ensure milk is available to those processors who need it most or who serve the domestic market.

The proposed legislation handicaps Fonterra farmers at a time when we are doing our utmost to ensure milk consumption in New Zealand increases, evidenced by our Milk in Schools, KickStart breakfast programmes, and our

ONLINE POLL Do you support the Government’s proposal to regulate milk price? ● Yes ● No

Have your say at: www.dairynews.co.nz

recent reduction of the wholesale milk price.

Fonterra is responsible for 25% of New Zealand’s export income, bringing in millions of dollars, all of which stays in the economy and flows through to the pockets of all New Zealanders.

As a country we cannot afford to mess with this

winning formula.

New Zealand needs enabling legislation that brings better returns to New Zealanders. Fonterra farmers will be sending this message to the Government in the strongest possible terms.

• Simon Couper is chairman of Fonterra Shareholders Council

Dairy News january 31, 2012

22 // opinion

Milk deal can turn sour FONTERRA’S RECENT decision to cut

local milk prices was welcomed by various consumer groups and others – including many selfFonterra’s decision to drop fresh milk prices may be costly in the long run.

serving politicians – all around New Zealand.

However, while the intention may be good, it’s a move that may cause long-term problems for the dairy cooperative and its suppliers. In fact, Fonterra’s dairy farmer owners’ could end up

not so much crying over spilt milk – but split milk prices!

This move risks stoking the myth – promulgated by critics –that products should be cheaper in the country where they are made or produced.

That is a fallacy that neither the dairy industry, the wider primary sector nor the New Zealand economy, as a whole, can afford.

Fonterra is the world’s leading supplier of premium dairy products.

Fact is fresh, farmed milk costs more than manufactured drinks. Meanwhile, demand for dairy products is rising with prosperity in markets such as China and others.

The New Zealand market is one of many Fonterra supplies products to.

It is hypocritical and an unfair expectation that New Zealand dairy farmers should have to subsidise buyers of dairy products in this country.

People living in competitive economies expect to pay international prices for all products. High world dairy prices are good news for New Zealand and we should pay no less, nor more, than milk is worth.

New Zealand consumers don’t expect cheaper or subsidised products from the plethora of international banks, insurance and oil companies based in this country.

Nor should they expect that of Fonterra – one of the few, truly New Zealand-based, successful international trading companies.

It appears Fonterra’s move to cut local milk prices comes after pressure began mounting last year from consumer advocates, as well as the aforementioned self-serving politicians, about rapidly rising milk prices – in the domestic and international market.

This led to calls for the Commerce Commission to investigate competition in wholesale and retail milk supply and for Parliament’s commerce committee to hold an inquiry.

The commission found supermarkets and wholesalers to be competitive

enough.

The focus then turned to the farmgate price, which is set by Fonterra.

However, when Fonterra’s new chief executive Theo Spierings came on board last September, one of his first public utterances was a promise to look at local retail prices. The dairy co-operative seemed to take much of the sting out of the high local-price claims when, at the end of last year, it announced plans to reintroduce free milk in primary schools.

Spierings says free milk in schools is part of a push by Fonterra to make milk more available to New Zealanders and boost local milk consumption. As the New Zealand Herald opined in an editorial in early January: “If falling consumption is the real reason Fonterra has now decided to drop its price, it is a sound commercial decision and the company should present the decision in those terms… not pretend it is an act of generosity or protection.”

No doubt rising milk prices have made life tough for local consumers, but so have rising petrol prices and the international recession.

The problem is straightforward: local dairy prices reflect international markets.

Fonterra is not doing itself, local consumers or its farmer shareholders any favours playing cheap public relations stunts (which may turn out to be rather costly) to try to appease its critics.

As former boss Andrew Ferrier explained last year when the milk price row first erupted: “Dairy prices are cyclical; they will come down again.” So when prices fall, will these same critics – who, in effect, want subsidies on local milk prices – demand domestic consumers pay a premium to dairy farmers to supplement their declining incomes? As the Tui billboards say: Yeah, right!

Meanwhile, Fonterra will be left with a legacy of not being able to charge real prices for its products in the New Zealand market.

Dairy News january 31, 2012

24 // agribusiness

Spray dryer a boon for innovators THE OPERATOR OF New Zealand’s first independent product development spray dryer says interest is high among dairy industry players.

The $11 million dryer facility, primarily funded

by Innovation Waikato Ltd, is the Waikato component of the Government-sponsored New Zealand Food Innovation Network. Capacity of the multi-purpose spray dryer is 0.5 tonne/hour.

Construction will be complete in April and the first product run is scheduled for mid-May. Plant operating manager Dave Shute says they are talking to dairy processors, “following a few strong leads.”

The dryer will be attractive to smaller, innovative processors in the speciality milk industry,

enabling them to move from innovation to commercialisation, says Shute.

“New Zealand is a major player in supplying milk and food products to the world. And, Asia – particularly China – is an extremely important export market right on our doorstep. The challenge for producers, however, is developing new products that appeal to these consumers.

“The issue is that if you are a smaller player in the specialty milk industry, it’s difficult to gain access to a commercial manufacturing facility where you can test a new product and then scale it up to commercial production.

The Innovation Park’s new dryer gives the innovators in the industry an opportunity they never had before.”

The long-term strategy for the plant is to expand the spray dryer’s capability to make infant formula, fruit and vegetable juice powders.

Finance for the dryer came from Innovation Waikato Ltd debt and a Government grant of $3.95 million.

The 10.5m high stainless steel dryer, weighing 7.5 tonnes, was lifted into the new pilot plant last month.

Waikato Innovation Park chief executive Derek Fairweather says it is now looking for commitments from companies that want to research and develop new spray dried food products in the pilot plant.

“Our message to the market is we’re open for business and we want to help companies create new products and reach

new export markets.

This dryer facility is a key mechanism for moving the dairy industry from a focus on commodities to value-added production.”

Fairweather says there is huge potential for specialty milk producers, in particular.

“This facility will give innovators in the industry the ability to come up with the next speciality milk product – along similar lines as Stolle, A2 and colostrum products. I also expect to see the facility helping create entirely new industries, such as dried sheep milk products.

“This facility creates opportunity for anyone who’s ready to scale up a new spray-dried product to commercial production. As our facility gains momentum, the opportunities for product inno-

The new 7.5 tonne dryer being lifted into the new plant.

vation will be that much more possible in smaller dairy companies.”

The Dairy Goat Cooperative has already committed to utilising 40% of the plant’s capacity. The company’s commitment was a critical factor in creating the commercial case, and gaining government

funding and approval to build the plant as a true private/public partnership.

The cooperative’s chief executive, Dave Stanley, says the dryer facility will help the company bring on extra capacity to meet expansion requirements.

“We’re going through

a major growth phase at Dairy Goat Cooperative and intend to install a second dryer on our Hamilton processing site within the next few years.

Using the new dryer at Waikato Innovation Park to produce our goat milk powders has provided us with the perfect bridge.”

dryer at a glance ■■ ■■ ■■ ■■ ■■ ■■

■■

■■

Only independent development dryer in New Zealand. $11 million project.

Capacity of 0.5 tonne/hour.

Construction complete in April, operational in May. Initial focus on making whole milk powders.

Long-term the dryer will make infant formula and fruit and vegetable powders.

The dryer is the Waikato component of the New Zealand Food Innovation Network.

Other NZ Food Innovation Network centres: Manukau, Palmerston North and Christchurch.

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FONTERRA HAS broken its record for

the highest export month with 246,000 tonnes of dairy products loaded on ships during December. The shipments boosted New Zealand’s economy by $1.3 billion for the month.

In March 2011 Fonterra shipped 229,000 tonnes of product, but continued growth in global demand for dairy products combined with record milk production early on in the current dairy season has led to another spike.

In December, Fonterra closed the door on an export container every 2.7 minutes – 546 containers a day. Fonterra’s exports account for more than a quarter of all New Zealand exports.

Fonterra trade and operations managing director Gary Romano says a good autumn and a mild winter created optimal grass growing conditions ahead of the 2011-12 dairy season.

“This helped create a wave of milk up about 10% on a daily basis during the peak flow in late September through to November.

“While conditions were good overall, farmers did face extreme challenges including a near nationwide dumping of spring snow and flooding in some regions.

“Our farmers have coped tremendously, not just with bad weather but also the record milk flow which peaked at more than 80 million litres a day,” he says. Fonterra teams have managed the huge milk flows, getting value out of “every drop”.

Demand for high quality dairy products is still strong. South East Asia, China, the Middle East and North Africa are driving growth in exports.

“Dairy is becoming increasingly important in these markets as people grow wealthier and want access to more nutritious foods,” says Romano.

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Dairy News january 31, 2012

26 // agribusiness

Building or breaking down glass ceilings

Some farming operations are limited by their owner’s attitude to technology.

MUCH OF my work in recent months has been on strategic reviews.

These assignments involve business health checks to benchmark performance against best practice for key areas such

SEED TREATMENT

as feed strategies, people management, budgeting and reporting. They take me into privileged territory as I compare the standards being achieved by farming operations against what I know is

possible. The benefit is a business plan that is clear about new opportunity and identifies factors that risk holding the business back.

The process is all about possibilities. In my years of helping farmers plan I have never seen a goal chosen by a business that has not already been achieved by another somewhere in the sector. This is why I’m convinced that bringing dreams to reality is not a matter of whether it can happen but whether the business owners will do what’s needed to make it happen.

This links to another principal for effective strategic planning. A significant risk to all plans is known as ‘FTI’ – the business owner’s failure to implement. Experience has shown me that most of us in business know what is possible and what we need to do. Not all of us get around to doing it.

This FTI can be incredibly costly.

This challenge affects us all. For some time I have been aware of the value technology could add to my accessibility as a consultant.

With smart phones, GPS and cloud based (internet) technology, the possibilities for easy communication and instant exchange of information are endless. Ye only this year did I choose to focus on implementing this. Doing so has led me to much more effective systems. I can now confidently take advantage of Skype based and other internet-based communication to consult via video links across Australasia and the wider world. I am now supporting farming enterprises that I will never physically see and people I will never meet.

Technology has made this

a reality and has added much to productivity and cost effectiveness.

In a similar way, I have seen my farmer clients remove limitations and create possibilities in their businesses.

I regard farmers’ enthusiasm for, or reluctance about, new technology as either removing or building ‘glass ceilings’ in their business. These are the invisible barriers to progress created by mindsets and attitudes to innovation. They commonly include lack of systems for feed budgeting to drive cost-effective strategies on feed policies. Others involve a casual approach to staff management despite widely recognised benefits of achieving clear expectations and accountability through job descriptions and regular performance reviews.

Some farming operations are limited by their owners’ or staff’s attitude to computerised planning and recording systems.

An open and educated mind frees the business for greater productivity and profit. A simple example I saw recently is a farmer who constantly thinks ‘smart’. He was doing a small building project on his property and realised he wasn’t carrying a spirit level. Some quick thinking resulted in him downloading an application via internet to his smart phone which enabled him to convert the phone to a spirit level whenever he needs it and he was able to complete his work without delay.

This is a small example but it demonstrates the type of thinking that can be used to capture advantage and save time.

I am encouraging my older clients to delegate this area to those who are in tune with technology if they don’t want to do it themselves. Younger people developing their careers don’t necessarily need formal education.

• Kerry Ryan is a Tauranga agribusiness consultant available to farming businesses face-to-face or online for advice and ideas.

You can contact him at www.kerryryan.co.nz

Dairy News january 31, 2012

agribusiness // 27

Westland awards study grants FOUR WEST Coast students

have won university scholarships from Westland Milk Products.

Harrison Jones will study towards Bachelor of Commerce (Agricultural Management) at Lincoln University; Georgia Robb, Bachelor of Commerce, Victoria University; Jessica Hamilton, Bachelor of Science, Canterbury University (Biology/Chemistry); and Zak Hamilton, Bachelor of Engineering, Canterbury University. The four were chosen from among 21 applicants.

Westland Milk Products chief executive Rod Quin says the company was impressed with the calibre of the applicants and congratulates all students who entered the scholarship contest.

“This year’s successful applicants have shown a commitment to their education. We wish them well with their studies and look forward to supporting them.”

The co-op’s university

Westland scholarship winners from left, Zak Hamilton, Jessica Hamilton, Harrison Jones and Georgia Robb.

scholarship scheme is intended to encourage and support West Coast students in tertiary education, and benefit the region’s employment prospects and economy.

As part of a new initiative in the scheme, departmental

managers at Westland Milk have been assigned to mentor the successful students if they need help during their studies.

The scholars receive $3000 per year for the duration of their studies (three years) and are guaranteed holiday work at

Westland Milk during the holidays from November to February. Full employment with the co-op is offered after graduation, subject to a position being available.

Hamilton, fresh from a yearlong AFS exchange to Serbia, is

looking forward to Canterbury University and experience at Westland – “... a company I would be proud to represent.”

Jessica’s brother Zak, also a successful scholarship applicant – “this is not just a monetary scholarship [but] an opportunity to start a career in a company I want to work with.”

Robb says she has chosen to study international business and marketing at Victoria University because she is passionate about the dairy industry. “Westland Milk Products is an exciting, forward thinking and innovative company.”

Jones, studying agricultural management at Lincoln University, says he was “overwhelmed [at winning] the scholarship as I know how well contested it is.”

At the end of 2011 Westland Milk had six other students in the scholarship scheme.

Six previous scholars have graduated and now work for the company.

in brief New trustee THE CARBON Farming Group has appointed Sean Weaver as a trustee for the notfor-profit organisation.

Established in 2008, the Carbon Farming Group provides information on climate change issues for the rural community. It is funded by The Tindall Foundation.

A senior environmental consultant, Weaver holds a PhD in forestry from the University of Canterbury. He has won six awards for tertiary teaching excellence while lecturing at Victoria University, Wellington.

“We are thrilled to attract someone of Sean’s calibre to the Carbon Farming Group,” says Clayton Wallwork, Carbon Farming Group trustee. “He has experience in working in New Zealand and the Pacific, in indigenous forest carbon management.

“His areas of expertise include reducing emissions from deforestation and degradation, improved forest management, and payment for ecosystem services on the voluntary market.”

Dairy News january 31, 2012

28 // management

Shed safety helps bottom line SHED SAFETY

improvements to artificial breeding (AB) facilities on farm have a direct effect on farm productivity and profitability. By reducing injuries productivity is

Safe rise platforms make the work of an AB technician easier.

up, idle time reduced, the cost of replacement labour eliminated, and medical treatment and rehabilitation expenses avoided.

Though difficult to measure, injuries also have a social and emotional impact on farm families, but are as real as the financial effects.

Another benefit to improving safety facilities for AB is that the whole artificial breeding process is more efficient – less time is spent in the shed, potentially more cows get in calf and the improvements can help farmers with tasks like tail painting, putting on Kamars, pregnancy testing, and

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used for veterinarians.

It is also, says Livestock Improvement Taranaki regional artificial breeding manager Rob Henry, essential that facilities ensure AB technicians are safe to perform inseminations successfully.

“If the AB technician is safe they can focus on the job rather than concentrating on avoiding slipping, falling, being crushed, squashed or kicked.”

And improving the safety of AB facilities doesn’t have to be costly, says Henry.

“Every shed is different, but with most sheds there are usually at least two or three options. By far the best is a purpose built herringbone type bail separate from the milking area and these can be included in any new building or major renovation.

“To avoid spending a lot of money making alterations it is a good idea for farmers to discuss their options with a member of the LIC team, as often improvements can be made quite cheaply.

“For example by constructing a platform that hinges from the pit wall or hangs from the breach rail, herringbone sheds can be improved.

“Chains are not suitable across the bridge in a rotary shed and should be replaced with a pipe or preferably portable platform, as cows will fight against a chain but don’t fight against a pipe.

“To ensure a suitable footing for farm staff and AB technicians, steel platforms should be made from a suitable tread plate material.”

Henry says in his experience farmers who have made improvements to their AB facilities said it made such a difference they wish they had carried them out years ago.

“Preventable accidents have been reducing among farm staff and AB technicians in the shed over recent years as more and more farmers have implemented safety improvements in the shed.

“Most farmers see the improvements as an investment, generally not needing to cost a lot of money, and if done properly only need doing once.”

Under the New Zealand Health and Safety and Employment Act (1992) employers are required to eliminate major hazards to employees if practicable and where there is a hazard to employees at work the employer shall take all practicable steps to eliminate it.

“The most common injuries sustained by AB technicians are a result of being crushed, kicked or slips due to substandard facilities.”

Henry says to meet LIC requirements for AB, no artificial breeding technician should be required to stand directly behind the cow without a protective barrier.

“Technicians need to be able to stand behind the cow, with a pipe railing between them and the animal, on a non-slip surface at least 500 mm wide at the same level as the cow.

“It is important cows are properly restrained for artificial insemination. AB technicians are skilled people, and they must place the semen through the cervix no more than one millimetre inside the uterus – any more can cause damage – so if cows are able to move around too much they risk injury.”

He says 3.3 million cows were artificially inseminated in the 201011 season with each of the 1000 or so LIC AB technicians countrywide performing 2000-5000 inseminations each.

There are some farmers, says Rob, who are reluctant to make changes, based on the fact they may not have had an accident.

“But if it is unsafe there will be an accident at some stage.”

LIC statistics show by far the biggest injury risk/ hazard for AB Technicians is the animal (cow) and the way the shed is set up for handling the animal.

The most commonly reported injuries are caused by crushing and kicking, followed by slips and falls.

For the period of June 2011 to mid October 2011, LIC AB Technicians reported 113 accidents/ incidents.

• This article first appeared in Getting the Basics Right 2012 issue

Dairy News january 31, 2012

management // 29

Andrew Hoggard says technology works for him.

Computer savvy leader Andrew Hoggard leads a busy life as Federated Farmers Manawatu/Rangitikei provincial president. He is also the national vice president of the Feds dairy section, manages a big dairy farm and has a young family. How does he do all this?

Peter Burke explains.

nology. Hoggard is an equity partner with his parents and brother and sister on a 220ha property north of Feilding. The farm runs 560 cows in two herds, milking in a modern rotary shed which oozes technology.

The office in the dairy shed has two computers: one to run the shed and another for Hoggard to run his business and do much of his voluntary work for the federation.

“If it wasn’t for the technology in the cow shed enabling me to zip into the office and do emails and run the farm with just two people I would be very limited in my off-farm stuff.

I would be limited to a provincial rather than a national role,” he says.

“As it is I struggle, but without the technology it would be impossible.”

He has played a major role in writing and presenting submissions on the Horizons Regional Council One Plan. He estimates he’s devoted twothree months worth of hours on that alone.

Hoggard is a fourth generation dairy farmer. His great grandfather, a Wellington lawyer, owned a block near Upper Hutt and until 1998 the family farmed there. In 1998, the present block was bought and a second one acquired in 2003 leading to the formation of the equity partnership in 2006. Hoggard has a degree in agricultural economics from Massey University. His brother and sister also have ag degrees and work in farming.

The driver for investing in technology came when the partnership acquired the extra farm across the road from the original property. They had to choose between employing more staff and investing in technology.

“We knew we would have two herds, which meant we would have to employ an extra labour unit or

Working offline for Feds ANDREW HOGGARD says despite the technology he doesn’t spend a lot of time on the computer. Each day he checks the stock records and gets on with Federated Farmers work as the cows go around the shed. The 37 year-old has more than farm work to do. He and his wife Audra have two children – Michaela 2 ½ and Payton 6 months – to care for so time is precious.

While he works hard on his farm and for the Federation he is unhappy with many farmers whom he says ‘bludge’ and benefit from the work he and others do. “There’s always a bunch of farmers out there who are too lazy to even pay a sub to the Feds,” he says.

But despite such knockbacks, Hoggard remains committed to the Federation due almost entirely to technology. He urges other farmers to take similar steps with technology.

“There are many mundane jobs around the farm and if you can use technology to help do these, then you can focus on the big picture and make important decisions quicker and get the profitable results.”

put technology into the cow shed.

We chose technology simply because we knew it would not only reduce the need for an extra labour unit, it would also reduce the labour inputs elsewhere and would free us up to do other things.”

From the minute the cows walk onto the rotary platform, the computer takes over. “She goes underneath the scanner which reads her EID tag. That communicates to the computer who she is and you can then tell whether she’s got ‘alerts’ on her and you can order any treatments or draft her if you want. It tells the feed system there’s a cow there to be fed and how much. As she completes the end of cycle on the rotary it’ll record the amount of milk she’s produced.”

The technology in the shed includes automatic cup removers and the DAL system which does milk metering. This shows the volume, protein and fat percentages which means Hoggard can then work out the kilos of protein and fat and the

semitic cell count.

“So basically all the information you get from a herd test we’re getting on a daily basis. We also have auto drafting and auto teat spray.

There’s bit more technology I could chuck in for weighing and there is, of course, full automation where minimal human inputs are required.”

But for Hoggard this is not technology for technology’s sake. It’s to save time and have data for quick decisions at critical times of any season. With the data he collects he is able to place ‘alerts’ on cows which may have high somatic cell counts and need further checking. It helps him decide which cows to dry off first and to draft mobs of cows quickly and accurately. Time saved by the use of technology enables him to use his time more efficiently.

And the technology is not confined to the dairy shed. He has a pasture meter and closely monitors his pasture to maximise utilisation and production.

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Dairy News january 31, 2012

30 // management

Keep effluent ponds low this summer AS THE long, hot days of

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DairyNZ. Let them get too full and when the weather turns and the autumn rains set in, overfull effluent ponds can cause all sorts of problems.

DairyNZ has launched a campaign to assist dairy to irrigate from their effluent ponds to keep them as low as possible this summer.

“We want to help remind people to irrigate when conditions allow from midsummer through to early autumn so when the wet weather starts there is as much free storage as possible in the pond,” says Theresa Wilson DairyNZ’s development project manager for effluent.

“A full pond means you have no storage. We know there are increasing numbers and complexity of issues in managing dairy farms. This campaign aims to ensure effluent ponds have their appropriate priority in the process, somewhere near fuel and crew issues.”

To help spread the message, DairyNZ’s campaign is using cartoons, a magnetic pond level indicator, t-shirts and – the highlight of the promotion – a ‘prize pond’ photo competition. Dairy farmers can send in their pictures to show how low their pond can go (see dairynz.co.nz/prizepond) and if you have the best looking pond you’ll win a barbecue hosted by former All Black prop, TV sport commentator, radio personality and farmer Richard Loe. DairyNZ is investigating regular weather reports to assist dairy farmers to bear their ponds in mind when they check the weather for other aspects of their farms.

“Having farmers compare their ponds helps us promote good practice for managing effluent ponds,” says Wilson.

“Some farmers also say it can be a psychological issue that full ponds look better than empty ones, so in a light-hearted way we want to show off and cele-

brate good-looking, empty storage ponds.”

It might have lighthearted elements, but the campaign has its serious side. Farmers have made good progress meeting effluent management requirements over the past few seasons. Nationally the rate of serious non-compliance fell to 11% last season on the back of clearer information to farmers and improved infrastructure on farms. Wilson says DairyNZ is supporting farmers to bring this rate down further.

“We know in previous years a few people have been caught out because their ponds were full. They’ve either had a pond overflowing, or they’ve irrigated in wet weather because their pond couldn’t hold any more effluent. We want to help our farmers by getting ponds ready to take on effluent in spring so they don’t add to the noncompliance statistics,” she says.

“It also makes good sense to get the valuable nutrients in effluent into the ground now to assist grass and crop growth when growing conditions are good.”

Managing effluent storage is only one side of the equation. A pond needs to be well constructed and of an appropriate size to cope with the farm system. Last October DairyNZ and the Institution of Professional Engineers New Zealand (IPENZ) released an effluent pond construction guide (see dairynz.co.nz).

Wilson says even the best effluent ponds won’t cope if they are full and sustained wet weather hits. “If your pond is at a high level now, irrigate to lower it as soon as you can; it won’t be long before winter is upon us.”

DairyNZ also has effluent systems advisors available to help with questions on effluent management, as well as extensive resources all available at www.dairynz/ effluent

Dairy News january 31, 2012

management // 31

Getting prepared for maize silage harvest will start in a few weeks.

It is a busy and stressful time for contractors and a little forward planning will help make their job easier.

Key things to consider are booking in your contractor, bunker or stack preparation and ordering silage making supplies.

Booking in the contractor If you haven’t already booked in your maize silage harvest contractor pick up the phone and make the call today.

Choose a reputable operator who has well maintained equipment. Don’t make harvest price your key selection criteria. A good and timely harvest job is worth a lot more than a cheap job.

Bunker or stack preparation Spring 2011 was a bumper pasture silage harvest season and as a consequence many silage bunkers are still quite full.

Think about where you will stack your maize silage this autumn and get the area ready well in advance of harvest.

Crop yield tDM/ha 20 22 24 26 28

Amount of maize silage (tDM)

50 100 150 200 250 300 If you are using an existing bunker or stack, plan to do necessary maintenance (e.g. drainage) prior to harvest. Remove silage residues and, where necessary, recut dirt walls to give a straight, clean edge. Place rat baits in stations around the bunker and stacks of tyres.

If you are building a new bunker or stack ensure it is large enough to hold your crop and that the size of the face matches the rate of feed-out. Aim to feed across the face of the stack every three days taking at least 0.5m from the face. To ensure good feed-out management and operator safety, the top of the face should be easily reached from ground level using the feed-out machinery available. For good compaction the bunker or

Approximate storage space required (cubic metres) Stack (no walls)

250 500 750 1000 1250 1500

32 1.3 1.4 1.5 1.6 1.8

34 1.2 1.3 1.4 1.5 1.6

222 444 667 889 1111 1333

Table 1: Approximate stack or bunker space required to store maize silage.

stack must be at least twice the width of the vehicle used to compact it.

Build your bunker or stack on a firm base away from hedges, trees and major drains with easy access all year round. Feedout costs will be reduced if the bunker or stack is built close to where the silage will be fed out. The approximate storage space you will need is shown in Table 1.

Machinery access Discuss with your contractor where the silage will be stacked and who will do the stack work.

Where required widen gateways, culverts and races to allow safe and easy access for the silage harvester, trucks or tractors and trailers that will

Harvest drymatter percentage (%DM) 30 1.3 1.5 1.6 1.7 1.9

Bunker (w walls)

36 1.1 1.2 1.3 1.4 1.6

Table 2: Pioneer® brand inoculant requirements (small bottles per hectare – each bottle treats 50 tonnes of wet silage) for a range of crop yields and drymatter percentages.

cart the silage to the stack.

Check overhead electric fence wires, power lines and tree branches allow plenty of clearance for large machinery.

Silage making supplies Ask your contractor if they will be providing silage making supplies (i.e. a high quality cover, tape for the cover joins and Pioneer® brand silage inoculant). If you are responsible for procuring these items make sure they are on farm well before harvest time. Silage inoculant requirements for a range of crop yields and drymatter are shown in Table 2.

Pioneer have developed a new maize silage harvesting manual – ‘The Complete Guide to Harvesting Maize Silage’ – which contains detailed information on all aspects of maize silage harvesting, storage and feed-out. To receive your complimentary copy call 0800 PIONEER (0800 746 633) • Ian Williams is a Pioneer forager specialist. Contact iwilliams@genetic.co.nz.

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Dairy News january 31, 2012

32 // animal health

Cheaper than a lame cow Bleeding with claw block

FRED HOEKSTRA

COWSLIPS ARE life-

savers for many cows; without them many more cows would go to the works.

This is assuming the slips are put on correctly; I have seen many instances where

they were not.

Some dairy farmers think cowslips are wonderful, some think they are too expensive and some could not make them stick on longer than a few steps.

Some say, “Just make sure you don’t have any lame cows.”

Most of the farmers

I know do not have easy answers to their lameness issues. Sometimes we come across a cow that has had a block applied to its sore claw. This clearly shows some farmers do not understand how cow blocks or cowslips work.

The idea of a block is to glue it underneath the

healthy claw so the sore claw is relieved from carrying any weight, allowing it to heal faster. The cow should then walk better immediately as her pain has been greatly reduced.

A block should last on a cow for three to four weeks. This gives time for the damaged claw to heal.

Our company sells the Demotec FuturaPad claw blocks and the Bovi-Bond block adhesive and blocks instead of cowslips. This is mainly because they are easy to work with, are nowhere near as weather dependant in the time they need to set (can be used on cold or hot days) and, most importantly, we can place the block much better on the claw.

Often you find with the shoe-type blocks that they sit too far forward. This makes the heel part of the block wear too fast or they may even collapse in that part of the block. The cow has no choice but to walk on the heel of her foot which puts an enormous strain on the tendon keeping the pedal bone down.

This can cause so much stretch in some cases that there is a degree of lasting damage.

With a FuturaPad or Bovi-Bond block you can place the block as far back as you like, though obviously you would not want to place it too far back.

The back part of the block A block should last on a cow for 3-4 weeks.

should be flush with the heel of the cow. It doesn’t matter at all if the toe is sticking over the front as long as the heel is flush.

This way the block will wear more evenly and that is also better for the ligaments.

The block should also be placed flush with the inside of the claw and needs to be as flat as possible and not on an angle.

Remember the block is there to support the weight of the cow; that can only be achieved if the block is placed square and not too far forward.

The price of a block is often challenged. It does pay to shop around: there can be big variations in the prices of the same products. But, even if the blocks were sold for $100 each they would still be cheaper than a lame cow.

We have recently become a distributor for the Bovi-Bond block. This is a fantastic product. We will also have an amazing launch deal on these blocks at the Southern Field Days. So if you are in the area pop in to check them out.

For more information and tips on working with blocks and on either of the two above-mentioned products, contact us on 0800 833463.

• Fred Hoekstra is managing director of Veehof Dairy Services.

Dairy News january 31, 2012

animal health // 33

Up to his armpits in dead possums

Paul Livingstone.

Working as a vet on the West Coast (he arrived there in 1974), Paul Livingstone spent his early days sorting the innards and carcasses of trailer loads of possums and many TB-infected cattle and deer. He knew what it was, but wondered why and how it was happening. Now, as the Animal Health Board’s manager of TB eradication and research, he realises that back then he knew “very little indeed”.

WHEN PAUL Livingstone arrived on the West Coast in 1974, he found a farming sector hit hard by bovine TB. The disease had wiped out so many dairy cattle that the Buller dairy factory was forced to close.

“Some farmers had TB in their herds before the testing programme began in 1961. One farmer had more than 1000 reactors killed over 10 years. The stoicism of those guys was humbling.”

He recalls a number of farmers that simply gave up on dairy farming and went into beef.

“You still got TB in beef herds, but it wasn’t as rampant, because the animals weren’t in such close contact.” Because beef farmers could finish and slaughter cattle within two years, there was less risk and many supplemented their income. “A number worked off the farm in the mills or mines.” What became obvious to Paul, however, was the massive number of TB reactors (animals that react positively to a TB-test) being discovered – a quarter of all cattle in some localities and 160 infected herds in total.

Too often, when the test results came through, the news was bad. Paul saw – and felt – the despair of young farmers trying to get established, only to lose much of their herd in a single test. His working days were full of judgement calls as to whether reactors should be retested. “There was always a risk that retesting reactors would leave the infection to spread in the herd.”

When TB turned up in a wild possum on the West Coast in 1967, farmers questioned whether the introduced predator was the source of their continued herd infections. At the time, government agencies scoffed at the suggestion. But hard proof came in 1971 from

trials undertaken at Mokihinui. During his time on the West Coast, Paul watched TB-infected possums spread into Karamea and move from one river catchment to the next.

“It was a terrible feeling,” he said. “We were powerless to stop the spread.”

He badly wanted to know how possums were infecting cattle and deer with the disease. “We’d been told that TB possums left pus on the pasture, but if that was all there was to it, why weren’t sheep being infected too?”

Then, as Paul worked a cyanide line one frosty morning, he noticed a dead possum with a distinctive lick mark along its side. A post-mortem later revealed that it had TB. “That got me thinking that the transfer of infection might be more direct.” A number of years later, Massey University researchers tested the hypothesis. “They sedated possums to simulate terminal TB-infected possums and put them in with cattle and deer.

Cattle came up and nuzzled and licked them, deer were more aggressive towards the possums and mouthed them, whereas sheep skirted round them. Looking back, that was an important turning point in our understanding,” said Paul. Not all his experiments went so well. Paul even investigated the use of low-frequency sound waves to see if that would affect possums. “My office was in the old railway building in Greymouth, right next to the railway station platform, so I asked the railway technicians for help.

We put a possum in a cage in our post-mortem room and aimed low frequency sound at it. It appeared to make no difference at all to the possum, but we cleared all the passengers off the platform.”

In 1978, Paul discovered TB in farmed deer.

“That was a catastrophe for a fledgling West Coast industry. I found the disease in other herds and the impact on the farmers was devastating.” While dismayed, Paul wasn’t entirely surprised. “The very first TB infection found in wild animals in New Zealand was in a deer in 1954.”

During his vet days on the West Coast – up to his armpits “in the TB swamp” – Paul was continually thinking about how the disease could be stopped. In 1987, he found himself heading the national TB control programme for the then Ministry of Agriculture and Fisheries (MAF).

That is when reality really hit home for Paul. “I got this terrible feeling of the immensity of the TB situation in New Zealand.

Looking back, I probably wasn’t prepared for it. However, a number of knowledgeable vets and senior livestock officers provided support and assistance that got us through that stage,” he said.

If he thought the West Coast was in bad shape, the central North Island came as a shock. Possum control funding had been slashed by the government in the late 1970s and Paul had to watch almost helplessly as the TB possum problem surged back. At that stage, the disease was observed spreading at about four kilometres a year, down the river catchments from the Hauhungaroa and Rangitoto ranges towards Waikato’s heartland. “There was no significant new funding for possum control until 1987 and we put what little we had into creating a low possum density buffer from the Whanganui River all the way to the Waikato River. This was a new concept and the aim was to stop TB possums spreading into heartland Waikato and the Taranaki hinter-

land.” Looking back, it was effective in stopping the spread.

In 1989, the Government allotted $3 million to possum control. By then, TB possums were spreading into north Kaipara, north Waikato, north Wairarapa, north Canterbury, across Otago and re-establishing their population in Southland. Pockets of new TB possums were turning up in areas such as Tauranga, Wan-

ganui, coastal Rangitikei, Hawke’s Bay, Murchison, Banks Peninsula and the Mackenzie Basin.

The rebound in infection rates at least proved to the government what Paul had known for years.

The key to beating TB was possum control. When he left the West Coast

in 1979, there were just 53 infected herds, down from 160. “I had seen what possum control could achieve – it was like turning off a tap,” he said.

Gradually and largely due to the formation of the AHB and bringing farmers on-side with the TB control programme, fund-

ing for possum control improved. The science and associated possum control methodologies also improved. A critical turning point was the advent in the mid-1990s of performance contracting, which provided a basis to tender possum control work out to private contractors.

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Dairy News january 31, 2012

34 // animal health Ian Troughton.

No time to relax WHEN HIS dairy herd tested positive for bovine TB more than a decade ago, Hauraki Plains farmer Ian Troughton might have been forgiven for despairing. After all, one of his main income streams was rearing young stock for sale to cover his grazing bills. “And I’m talking

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$100,000 grazing bills,” he says.

Bovine TB put an end to that and much more.

Troughton has lost nearly 200 cows to the disease, at $1500 per cow – but despair has never been an option. “You can’t afford to let it come to that. You just have to look at it differently and consider the alternatives.

“I once found nine cows with bloat that had gone through the fence, or you might have an unexpected number of empty cows. We manage all those situations, so you have to keep these things in perspective. In a sense, TB is no worse than that.”

But even Troughton accepts the disease remains one of the biggest challenges he’s faced in a lifetime of farming on the Hauraki Plains. “It’s not something like mastitis that you can treat and cure and it never takes your scrubbers, always the best cow in your herd.”

He recalls his favourite, a nine-year-old – his top cow for five years.

“And she was taken away.

It’s gut wrenching; you’re almost in tears; it’s like losing your favourite dog.”

Troughton’s farm was put on movement control: no animals could come in or go out without testing and documentation.

Any opportunities to sell when prices spiked, or buy when they fell, had to go begging.

So, when he couldn’t sell his surplus calves he changed the way he farmed. “We decided to shift focus from trading cattle to retaining them and building our numbers up.

“It was one way of getting around it. It wasn’t in the expansion plan but it alleviated the issue of not being able to trade stock.”

In 2003, Troughton’s herd returned just one positive TB test and he dared to let himself believe the ordeal was over. But the disease wasn’t done with the farm yet; the next eight tests revealed more positive reactions. “We slaughtered another 100 animals. But I always try to look for positives.”

He soon found them, as there were plenty of other farmers in the dis-

trict struggling with infected herds and some were trying to get out of their farms. “Some people had actually sold their herd, but as part of their sale agreement, they had to TB test their cattle before they handed over.

“Then they’d find [an infected animal] which scuppered the deal because they couldn’t move those cows. So we took on some of those cows at a reduced price. In some cases, we got them for just about the works price.

“It worked to the advantage of both parties. We were at least able to offer them an option, where before they’d none.

The scale of our breakdown meant it didn’t make any difference to us.

I was able to replace cows at a similar sort of price to what I was getting from the compensation, so it worked well for us.”

Troughton set up a restricted area on one of his farms. “Because of the number of replacement calves we reared, we set up a quarantine area. We would bring those calves home and rear them in that area until they went clear, then we could shift them on. It was a hassle, but at least it gave us some flexibility.”

In all the years he’s battled with TB, his neighbours have remained clear.

“It’s difficult to understand why you were the one that got infected, why it stopped at your boundary. If it was possums, or ferrets, or stoats, or whatever, the boundary fence doesn’t stop them, so why were we infected and not our neighbours? You ask yourself what you’re doing wrong.”

There’s a difference, though, between resignation and lackadaisia. With the number of TB-infected herds now at a historic low, Troughton would hate to see the disease flare up again through complacency.

“We can’t afford to relax the wild animal control or the testing; the cost is too high. As time goes by, each new generation has yet to experience how tough things can be.”

• Article provided by Animal Health Board

Dairy News january 31, 2012

animal health // 35

Mastitis vaccine study launched MERCK ANIMAL

Health has signed an agreement with two universities to begin developing vaccination strategies against bacterial udder infections (mastitis) in dairy cattle.

The project – ‘Evasion Molecules in Bovine Mastitis Vaccines’ (EVAC) – is to develop a series of vaccines against difficultto-treat infections from bacteria known to cause bovine mastitis. Examples of such bacteria are Staphylococcus aureus, Streptococcus uberis and Escherichia coli.

Merck will work with the Department of Medical Microbiology of the University Medical Center (UMC) Utrecht and the Faculty of Veterinary Medicine of Utrecht University.

The EVAC project is part of a programme called ALTANT (Alternatives to Antibiotics), coordinated by Immuno Valley, a public-private research consortium. The programme is funded by the Dutch Ministry of Economic Affairs, Agriculture & Innovation and by academic and industrial partners aiming to generate knowledge and alternative tools that complement the available treatments to control infectious diseases in farm animals.

Paul Vermeij, senior project leader at Merck Animal Health’s Discovery & Technology Department in Boxmeer, The Netherlands, explains: “In the open innovation model as applied in the EVAC project, we are combin-

ing the veterinary vaccine expertise of Merck Animal Health with the knowledge of evasion molecules of the Department of Medical Microbiology at UMC Utrecht and the expertise on bovine immunology available at the Faculty of Veterinary Medicine at Utrecht University.

“The technologies developed within the ALTANT programme may result in an efficacious vaccine against bovine mastitis. In combination with our current therapeutic tools, it can result in unprecedented possibilities to control the disease.

In addition to improvement of animal welfare and economic advantages for the farmer, such a vaccine can also contribute to a responsible use of antibiotics,” says Rene Aerts, vice-president Global Biologicals R&D at Merck Animal Health.

Development of vaccines against bovine mastitis has long been hampered due to the fact the relevant pathogens are capable of producing socalled ‘immune evasion molecules’ that block or interfere with important processes in the immune system of the cow. Similarly, evasion molecules also appear to interfere with the immune response provoked by vaccines.

Therefore, despite the induction of high antibody levels, the clinical efficacy of most mastitis vaccines developed so far has been poor.

In the EVAC project, evasion molecules have been identified and

in brief Dead possum warning REPORTS IN Northland of possums suspected to be showing signs of ‘wobbly possum disease’ has prompted the Animal Health Board (AHB) to warn against spreading the pest around the region.

“Moving any wild animals into new areas is irresponsible,” says Northern North Island regional coordinator Frank Pavitt.

“Not only could you be circulating one infectious virus – wobbly possum disease – in an attempt to control the pests’ population, you may also expose an area to bovine TB that was previously free of the disease.”

characterised, and subsequently recombinant versions of these proteins have been produced. Combinations of such evasion molecules will be added to traditional antigens in candidate vaccines. Vaccination is expected to raise neutralising antibodies against immune

evasion molecules in the animal. As a consequence, the evasion system of the bacteria is impaired and the antibodies are able to neutralise the mastitis-causing pathogens.

The availability of effective vaccines in addition to the current therapeutic treatments would provide

Mastitis is a costly problem worldwide.

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Although treatment with antibiotics is a common part of mastitis management, it is often associated with

high treatment costs and its irresponsible use is increasingly associated with the risk of developing antibiotic resistance.

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Dairy News january 31, 2012

36 // animal health/genetics

Herd fertility in your hands ANGELA ENTWISLE

GETTING MORE

cows in calf is the biggest improvement you can make to your dairy business.

What does profitable dairying mean to you?

Each farm owner, manager or sharemilker will have a different answer to this question. Milk solids in the vat, cows in calf, highvalue progeny, longevity, cull value, easy-to-manage cows and more may feature on your list.

The defining point to note out of this list is every farm is different and each farmer has individual goals and aspirations for their herd; one size does not fit all.

What all of these aims have in common, however, is to achieve any of them you need to get your cows

in calf.

CRV AmBreed is pleased to bring you key resources and our own experience in breeding and mating management to help you and your staff improve whole-herd fertility from birth, right though their productive lives.

Genetics, in particular choosing the right sires to achieve your breeding objectives, is one of the elements contributing to getting your cows in calf.

Getting the right bull for the job doesn’t have to be difficult; breeding advice programmes such as CRV AmBreed’s SireMatch are designed to make it easy and effective.

We recognise every farmer has different goals and needs. Our SireMatch product takes this into account, turning the farmer’s breeding goals into

practical sire advice, with recommendations ranging from simple inbreeding prevention through to highly customised cowby-cow improvements.

But before you can mate your cows, you need to correctly and consistently pick those that are on heat. Quite simply, if your heat detection isn’t up to scratch then you won’t get your cows in calf.

DairyNZ tells us the best heat detection programmes, both before and during mating, combine planning and observation with effective heat detection aids. Tail paint has been used for many years but today, farmers have even better detection aids to make the job easy and accurate.

Our Estrotect heat detectors take a lot of the uncertainty out of heat

Genetics is about choosing the right sire to achieve your breeding objectives.

detection, even for farms with large herds and multiple staff. Unlike tailpaint, Estrotects aren’t affected by inconsisten-

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tects are applied in time for premating heats and right through mating. As cows come on heat and are recorded, a different colour Estrotect is applied making it obvious which cows have not cycled and need to be referred to your vet for further investigation to stay within a concentrated calving pattern.

Finally, you’ll want to make sure those straws hit the spot. Artificial insemination is something CRV AmBreed knows about. We inseminate close to half a million cows each year and have trained 10,000 New Zealand dairy farmers to successfully inseminate their own cows at out DIY

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AI training schools.”

So, it becomes obvious that mating management and fertility improvement is a year-round approach that lasts the lifetime of the cow. But what seems like a tall order in a volatile season will yield measurable improvement in future seasons, leading to real improvements in the herd as culling decisions are made under production, conformation and management objectives rather than fertility and even some immediate production results; a sideeffect of more active management practices.

• Angela Entwisle is product manager, herd services at CRV AmBreed.

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Dairy News january 31, 2012

animal health // 37

High country brings feed challenges IT IS a high, dry climate to be dairying in at 400m above sea level north of Omarama, one that may appear to present some climatic challenges, but also some animal health bonuses.

For two seasons Lee Bryant and his wife Sarah have been variable order sharemilkers on a 1450 cow property owned by Dave and Karen Ellis, 10km north of Omarama.

Only converted two seasons ago, it is one of only two dairy operations in the immediate district.

With many frost days, low humidity and rainfall about 400mm a year the couple could be regarded as farming in pioneering country for cows. It would never have been conceived 10-15 years ago.

Water supply for the 400ha property’s three centre pivots comes from the nearby Lake Ruataniwha scheme in unlimited amounts to turn country previously the preserve of sheep into a productive dairy operation.

With its short, intensive growing season that can see frosts strike in April and cold lingering well into November, the season can move from feeding silage supplement out one week, to harvesting the spike in surplus only three weeks later.

Meantime the harsh winters bring particular demands on autumn pasture management that are counter intuitive for most dairy farmers focussed on building a good feed reserve heading into winter.

The frost days require pasture to be grazed down to a farm average of only 1900kgDM/ha.

The lower residual heading into winter will ensure minimal frost damage to grass that will turn into a brown mush if left standing through winter, offering no feed value coming into spring.

“That was a lesson we learned the first season here. The first year we did not get the most out of the pasture we did have; at calving time the cows were in good condition, but went backwards

pretty quickly, and we had a few metabolic problems.”

Lee had previous experience using Rumensin on a property at Waimate, and had noticed the difference between having it as an input and not having it on that property. Those cows that did not have Rumensin exhibited less energy and production, while those that had received it had fewer deaths, more energy and generally performed better.

“After talking with our farm advisor, and discussing it with the farm owner David and our vet, we decided with the better payout prospects we wanted to get milk solids up, and the vet’s advice was to put Rumensin through the water line.”

The property has about 40ha of new grass, and silage supplements amounted to 360 tonne this season. Rumensin helped maximise benefits from both inputs – no bloat occurred in cows grazing the young grass, while the feed value of the silage was maximised, putting an average of 420kgMS per cow into the vat this year, a good lift on the average of 396kgMS per cow the season before.

Lee has found the drier environment seems to create greater dry matter content in the grass than is apparent by eye; often the plate meter may indicate 3000kgDM, when that amount is nearer 3500kgDM/ha.

The increased proportion of young grass, good cow condition coming into calving, and addition of Rumensin have put the farm on track for an excellent production year, totalling 610,000kgMS with only 100 more cows, and exhibiting a steady milk curve through much of the season.

For April the herd produced 65,000kgMS, only 24% off the season peak of 85,000kgMS which had a 10 day average peak of 1.95kgMS/cow. Lee says the better energy levels over spring helped achieve an excellent empty rate of 5.1%.

His positive experience with Rumensin has him intending to use it on his next job, a family equity partnership in Canterbury that will be a higher input, higher stocked farm run-

Lee Bryant

ning 4.3 cows per hectare.

“We are hoping to get up to 550kg per cow, there is no reason why we could not do that, and Rumensin will have a part to play in achieving that.”

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Dairy News january 31, 2012

38 // machinery & products

Quieter herd, finer milk TONY HOPKINSON

THE HOUGHTON farm

at Ngarua has been home to Neil and Shirley for 40 years and “everything you see we put here,” says Neil.

The farm is 137ha including a 16ha reserve bordering the Waitoa River. The reserve is mainly totara, some of which they have milled for their own use. They also

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have a 11ha run-off which is used to grow maize and provide some grazing for young stock. A further 6ha of maize is grown on the home property as part of a re-grassing plan. All maize when harvested is stacked and stored at the home farm.

The milking platform is run as two separate milking units managed by one contract milker, milking a total of 500 Jersey cows.

There are two dairy sheds, each with its own feed pad, and cows have their own separate grazing areas. “The system works

well, with two smaller herds, and there is little change-over of grazing areas.”

Houghton supplies the Tatua Dairy Company and employs Kerry Ryan as a fertiliser advisor.

He harvests 130 bales of silage and buys some in as needed.

The maize on the feed pads is supplemented by PKE and other minerals to satisfy seasonal needs.

Three seasons ago he installed in both sheds a Corkill Dairy Systems Varivac milking system.

The Varivac regulates the

Neil Houghton, Ngarua.

vacuum pump speed to reduce electricity costs and remove stress from cows. It is said to help reduce somatic cell count.

At the same time Houghton also installed a CSL Milk Flow milk pump controller. This is controlled from a probe in the receiving can and gives more even milk flow through the four-headed diaphragm milk pumps to reduce damage to the milk.

“The Varivac is gentle on the cows and is a lot quieter. The cows are happier and this improves

cow flow, and the combination with the milk pump

controller means we are reducing the damage that

can happen to the milk.”

Tel. 0800 10 7008 The Varivac regulates the vacuum pump speed.

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Dairy News january 31, 2012

machinery & products // 39

Expert trials will verify spreader rates TONY HOPKINSON

IN AN effort to improve the accuracy of his company’s

effluent spreaders, Andrew Williams, Williams Engineering, has been doing trials, with Massey University, to verify the application rates they recommend.

Says Williams, “With the increasing regulations imposed by regional councils, I want to be able to show that our spreaders will do what I say they will do and deliver accurate quantities.”

The trials are being done on a farm at Ngatea, Hauraki Plains, supervised by Jim Hargreaves. He has worked with Williams Engineering for seven years.

Hargreaves is a science graduate of Massey University and tutors there in renewable energy and agricultural engineering.

A new model Williams Spider will run at low rates by halving the travel speed and covering twice the area.

He was involved in formulating the DairyNZ code of practice for irrigating dairy effluent on farms.

“I’m a 16-year veteran at Massey and I have set up courses for manufacturers and designers, regional council representatives, engineering consultants and some farmers, as to what is needed in the designing of a good irrigation system that works correctly.” These include pump power, delivery lines and the actual irrigator, and how a good system should work.

“The uniformity of distribution of the material is vital to get the rates correct related to the applied depth. Farmers just have to get it right” Failure to get the application rates correct can lead to ponding, causing contamination of the soil or drainage to waterways.

Williams offers add-ons to his systems to avoid some problems that can happen with irrigators. He and Hargreaves agree it remains the responsibility of the operator to ensure the system is operating correctly.

“These trials on the Greenback Spider irrigator are giving perfect results on uniformity of application with our standard boom angles and nozzle sizes,” says Williams.

The Spider irrigator can be supplied with different nozzles to suit different flow rates, pressures and application rates. This irrigator is the company’s biggest selling model in New Zealand and overseas.

“I am aiming for low application rates and will be able to supply printouts for farmers to use to measure their rates. These originate in recognised tests.”

Also being tested by Hargreaves is a prototype of a large Williams Greenback spreader. “If you can’t make it better then make it bigger.”

This spreader has two nozzles on each arm with a spread width of 50m from 18m booms compared with 9m booms on the Spider model. It folds quickly and easily for shifting between paddocks.

He is aiming to run this model at low rates by halving the travel speed and covering twice the area.

“This spreader will deliver accurate application rates with less labour input.”

Tel. 0800 433 358

Andrew Williams (left) and Jim Hargreaves.

Dairy News january 31, 2012

40 // machinery & products

Baling smaller paddocks ‘ONE MAN easy’ summarises the running of a new compact baler-wrapper from Kuhn.

The company says its i-BIO baler-wrapper combination is a “light-weight, efficient and high-speed one-man” machine.

It weighs no more than

3.5 tonnes (unloaded), is “manoeuvrable and suitable for smaller tractors and ideal for small paddocks with narrow access and hilly areas.”

Isobus-compatible and using Kuhn’s patented IntelliWrap bale wrapping facility and new forage

intake system (integral to the machine), the i-BIO requires no bale transfer during the making/wrapping process. Instead the upper part of the bale chamber opens after bale formation and binding, allowing pre-stretchers (fitted on a crown gear)

to carry out the wrapping. The machine has a 2.3m wide pick-up. The IntelliWrap system uses electronics and hydraulics to gain flexibility and control during wrapping.

The system allows control of the percentage film overlap and enables the

number of film layers to be set simply by pressing a terminal key. The operator gets a good view, from the tractor seat, of all net binding, wrapping and discharge operations, without need for a camera.

Tel. (0800) 585-007 www.kuhn.co.nz

More want their gear on display DEMAND FOR National Fieldays sites is up 13% on 2011

applications, says events manager Vanessa Richmond.

To date, 88% of all agricultural sites have been sold, well ahead of previous years. And the Rural Living area, comprising 8% of the show, is in greater demand.

Businesses are taking more space to showcase products and services, Richmond says, “With exhibitors requiring more space, it’s clear businesses involved in agriculture realise the benefits of a presence at Fieldays.”

‘The Changing Face of Farming’ is the 2012 Premier Feature, focusing on the various land ownership models and change in farming approaches. The theme incorporates the trending shift from traditional family owned farms and in turn the effects on the rural landscape.

Other changes include a larger international exhibition area in the pavilion.

And the Kiwi’s Best marquee will also increase in size, with primary production celebrated as an important part of agriculture.

Sites are now assigned in order of submission. Fieldays will be held June 13-16 at Mystery Creek Events Centre, 10 minutes south of Hamilton.

Tel. 07 843 4499

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Dairy News january 31, 2012

machinery & products // 41

Fert, spray ordering made easier ORDERING AND tracking fertiliser and spray is made easier for farmers and contractors using a new system from TracMap NZ Ltd, the agricultural GPS company.

National sales manager Lance Nuttall says the system will benefit farmers and contractors alike. “We are very excited about its launch,” he says.

“The system allows for greater visibility of product orders. We have attempted to keep the process as simple as possible, from the client placing the initial order to the contractor sending that order to the truck(s) and once com-

pleted providing the proof of placement back to the client.”

The process starts by the farmer placing an order via the contractor’s secure web site. This is done by simply highlighting the paddocks that require treatment, plus adding any other relevant information such as hazards, no go areas and access ways. The order is then sent directly to the contractor for actioning.

The contractor then views the fresh order and immediately allocates the job and sends wirelessly directly to the vehicle(s)’ TracMap TM465c head unit. This speeds up the

process of allocating jobs and minimises risk of confusion over what paddocks are to be treated.

The driver sees on the head unit the farm map showing the paddocks requiring treatment ‘coloured in’, plus any other information the farmer has added.

“We have also given the contractor the ability to create an order on behalf of his client.

Not always will the farmer have access to his computer,” says Nuttall.

Once the job is completed it can be wirelessly sent back to the contractor for sign-off and notification is then sent to the client that the job is complete and ready for viewing through their secure log-on.

“One key benefit of the system is that it is web

based, so needs no extra hardware. This also allows the farmer and/or contractor to access the system remotely on any computer through the secure log-on.

I see a real benefit in this, particularly to those multifarm owners who want visibility of their entire operation.”

The system also provides live tracking and RUC reporting.

“We are confident this will add value for our customers and ‘raise the bar’ when it comes to product ordering and providing proof of placement for customers,” says Nuttall.

Tel. 0800 872 262

See Us At The

Sites 493 & 615

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TA RY

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Dairy News january 31, 2012

42 // motoring

Nifty French marque making global comeback RENAULT IS storming the globe, selling 2,722,062 vehicles worldwide in 2011 (increase of 94,697 or 3.6% over 2010) and claiming “true worldwide brand” status.

Outside Europe it made 43% of its sales in 2011, compared to 37% in 2010.

In New Zealand, Renault was the fastest growing European brand and in Australia the third-best growing brand partly thanks to a revitalised model line-up including the Megane hatch, Koleos SUV and Fluence saloon.

“Our medium term goal is to become the most popular French brand in New Zealand,” says Stephen Kenchington, general manager of Renault Cars in New Zealand.

“We’re expanding the dealer network and expect a wider range of models to become available in the next 12 months.”

In Europe, Renault remained the number two brand for passenger cars (PC) and light commercial vehicles (LCV), taking 8.6% of the market. The Renault

group led the LCV market for the 14th year running, with a 15.6% share of the market Late 2011 it launched ZE (zero emission in road use) vehicles including Fluence ZE and Kangoo Van ZE, which was recently named International Van of the Year 2012.

Renault’s electric van was selected by 19 major French companies. It is contracted to supply 15,600 vehicles.

Russia took 40% more vehicles, Turkey 13% more and Latin America 10%. Renault Group’s global market share stood at 3.6%.

In Europe, the Group took 10.1% of the market.

Renault consolidated its LCV leadership in the Europe market since 1998, taking a market share of 15.6%.

Outside Europe Brazil is now Renault’s second largest market behind France.

Russia has moved into fourth place (up five); Turkey is in fifth place (up two); Argentina has moved to eighth place (up three); and Iran is now the Group’s No.10 market (up three).

‘Formidable’ coupe JAGUAR’S COUPE, the XK, has a higher luxury specification for 2012 and includes a new top-of-therange XKR-S with performance described as “formidable” for a Grand Tourer coupe and convertible.

In Portfolio specification the XKR-S has new soft-grain leather upholstery, heated and cooled seats, heated steering wheel, a suede headlining and an 8-speaker Bowers and Wilkins 525 watts

sound system as standard.

The latest XK, in all its derivations, is recognisable by its thinner Xenon headlights and LED running lights and turn signals. There is a larger grille and new front bumper.

There are five new paints in the 17 colour range and the choice of 11 different alloy wheels from 19 to 20 inches diameter.

The Portfolio coupe and convertible models are available for $175,000 and $190,000 respectively.

Apart from the new features detailed above, these have adaptive dynamic suspension, sequential shift with steering column paddles for the 6-speed automatic transmission behind the 283 kWs five litre V8.

The XKR comes with a supercharged version of the V8 motor producing 375kW and 625Nm torque.

Added features include an active differential, ‘R’ performance brakes, quad tail pipes and the ‘R’ exterior. These will sell for $195,000 and $210,000

for coupe and convertible respectively.

The range topping XKR-S has been awarded ‘2011 Sports Car of the Year’ by the respected German motoring magazine, Auto Bild Sportscars, following a poll of 70,000 readers.

Its 5L supercharged V8 engine produces 412kW and 680Nm, giving it 0-100km/h in 4.4 seconds.

Top speed is 300km/h.

The cars have aluminium body shells for better economy, agility and performance.

Alpines contest historic rally A TRIO of Renault 5

Alpines will contest this year’s Rallye Monte-Carlo Historique to start the celebrations marking the car’s 40th anniversary.

The cars have been prepared for the event and will be driven by Frenchmen Jean Ragnotti who was second on the 1978 Monte Carlo Rally in a 5 Alpine, Alain Serpaggi and Manu Guigou. All three cars will start the rally from Reims.

This year, Renault is celebrating the 40th anniversary of the Renault 5, five million of which were sold.

The French hatchback will this year be in the spotlight. Celebrations will begin with the presence of three original, Renault-entered Renault 5 Alpines on the 2012 Rallye Monte-Carlo Historique.

Renault Classic prepared the cars. They were stripped and rebuilt for the challenge they face

Technical Data ■■

Engine: four cylinders in-line, 1,397cc.

■■

Transmission: front-wheel drive, five-speed gearbox + reverse.

■■

Brakes: discs all-round.

■■

Length: 3.56m, width 1.52m, weight 870kg.

■■

Top speed: about 190kph.

along the 2500km route.

Emmanuel Guigou, the 2008 French Gravel Rally Championship runnerup, is more accustomed to the Group N4 Megane R.S. than the R5 Alpine.

Alain Serpaggi is a

former test driver with Alpine who has an impressive record in motorsport.

Jean Ragnotti will drive the car (N°19) he steered to second place overall on the 1978 Rallye MonteCarlo.

The Neal KiNsey Group lauNches iN NZ for 2012 aNd beyoNd mission statement The main focus of The Neal Kinsey NZ Group is the health of our New Zealand soils. Our aim is to equip the New Zealand agricultural and horticultural industries with the best tools and knowledge based on proven scientific research to make the best choices on how to improve the quality of their soil fertility in a sustainable, healthy and financially sound manner.

who we are The Neal Kinsey NZ Group is a multi-disciplinary collective who share the one goal for realising the long-term sustainable health of our agricultural environments and believe that this can be best achieved through the reduction of costly and artificial chemical inputs. whaT we do Our services provide farmers and horticulturists with a complete

soil audit, this audit provides a comprehensive analysis of soil structure, micro and macro nutrient levels found deficient by the laboratory and a full unbiased recommendation of what is required to correct these deficiencies. To compliment the soil audit our team have been trained by Kinsey agricultural Services to offer consultation and expert advice on how to correct any imbalances as identified in the soil audit. Once the problems have been identified we provide recommendations that will begin to improve soil structures towards achieving optimum soil health. Our philosophy is to “feed the soil - let the soil feed the plant”.

how we do iT We have found that the most reliable, environmentally friendly

and cost effective method of soil analysis is the albrecht/Kinsey system. This method involves correctly identifying your soil’s deficiencies and highlighting any problem areas that need addressing. The concept behind ‘fertility management’ is to establish a balanced system that contains the right nutrients in the correct proportions to support healthy plant and animal life specific to your individual needs.

By establishing an optimal balance of trace elements in your soil we unlock it’s true potential allowing plants to take-up the necessary nutrients required. This results in higher outputs through better quality and quantity, lower input costs in the long term, improved animal health and the continued stability of your soil’s health.

Look Out for Neal Kinsey 2012 seminar!

March 5th, 6th and 7th – Huka Falls Lodge, Rangatira, Taupo March 12th, 13th and 14th – Ascot Hotel, Invercargill

For more inFormation or to book a soil test call Our Team ON FreephONe

0800 KiNsey 0800 546 739

AgriGanics Ltd Dunedin, Otago

Golden Bay Dolomite Ltd Takaka, Golden Bay

Kiwi Fertiliser Company Ltd Otorohanga, Waikato

Parker Lime Co. Ltd Kaiwaka, Northland

Avoca Lime Company Ltd Whangarei, Northland

Working. Together. New Zealand.

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| Helping grow the country