Dairy News 15 Oct 2013

$5 billion extra for farmers this season. Page 3

take the stress out of farming DWN workshops Page 36 october 15, 2013 Issue 300

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Birthday giveaway Page 6 // www.dairynews.co.nz

Dairy awards turn 25

A trip down memory lane with inaugural winners Diane and Kevin Goble, Taranaki. PAGE 15

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Dairy News october 15, 2013

news // 3

$5 billion windfall PETER BURKE peterb@ruralnews.co.nz

NEW ZEALAND dairy farmers are set to earn an extra $5 billion this season if the payout forecast holds and no spanners – such as another drought – fall into the works.

Westpac’s chief economist Dominick Stephens told Dairy News dairy farmers’ revenue will be 50% up on last season; this is farm income and should not be confused with export revenue for dairy products, which is different. Dairy farmers could earn in total $12 billion.

Stephens says the $5 billion assumes the Fonterra payout remaining at $8.32/kgMS or better and milk production being up by 5%, where it is now tracking after a bumper start to spring.

The figures are based on data from Fonterra and assumptions made on other dairy companies.

The prediction for this season contrasts sharply with that of last season when milk price and production were depressed by drought, Stephens says.

The big question is what might dairy farmers do with this windfall?

“Historically the tendency is to buy more land and convert more farms into dairy. Certainly that’s what one would expect. I think it will result in a rise in the price of dairy land and probably a

PKE fears allayed.

PG.16-17

Co-op pushes on in China.

PG.20

greater turnover in farms.”

Stephens expects some farmers to pay debt, and others to buy new technology for their farms and make changes to improve profitability.

He doesn’t believe new environmental standards imposed by regional councils on dairy conversions will deter those wanting to invest in dairying. Prospective investors will weigh up the profitability of investments according to payouts and other factors, he says.

“There is still a fair way to go around Canterbury with the potential of land on the plains to be irrigated and converted to dairying. Irrigation can make a huge difference to land once considered unsuitable for dairying.”

But the windfall payout might be on the back of a ‘one-off’ good season, say commentators spoken to by Dairy News. There are predictions of a 2015 season payout of about $7.

And there is speculation Fonterra may be hit by large compensation claims because of the botulism scare. Stephens concedes this could be a problem, but he believes claims will be small relative to Fonterra’s global revenue.

Craig McBeth, DairyNZ,

says milk production in most regions except, notably, Southland and Northland, is well up on last season for this time of the year. But these are early days, he points out.

With the prospect of a bumper payout, McBeth is urging farmers to be cautious about splashing out on their windfall. Commodities are well known to be cyclical in price and will eventually drop from their highs for the usual reasons of supply and demand.

Farmers must plan for the medium-long term and farm within the resources they have on their properties, McBeth says.

Dominick Stephens

a fast growing problem looms GREAT WEATHER causing phenomenal grass growth has raised milk production by 5%, creating a fresh challenge – how to manage the grass.

Craig McBeth, DairyNZ, advises making sure it doesn’t go to seed which it can do quickly. “So focusing on grazing paddocks down to the right grazing residuals – 15001600kgDM/ha – is important to maintain the quality of the pasture and the nutritional value. Maintaining good grazing

Fun team lifts productivity.

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Craig McBeth

pressure for quality grass to feed cows next time they come around to that paddock in a month is really important.”

Greater grass growth in August was a problem: it was hard then to decide whether or not to cut silage, McBeth says.

Now farmers must keep watch on grass in danger of turning from a vegetative to a reproductive stage.

The amount of silage now being cut varies from region to region.

Meanwhile, mating time approaches and farmers must be mindful of how best to feed their cows.

“They face a challenge: not wanting to drop back on the supplements they are giving their cows because they think feeding a bit of supplement has an impact. But research suggests that is not the case; the die for mating performance has been cast long before now.

Feeding grass is fine; it’s a great diet for cows.”

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Dairy News october 15, 2013

4 // news

Fonterra watches Oz dairy play with interest FONTERRA CHAIRMAN John Wilson

believes the Australian dairy sector will consolidate further.

He says the co-op will be watching with interest Canadian dairy giant Saputo’s entry into the Australian market. Saputo looks set to buy a majority shareholding in listed processor Warrnambool Cheese and Butter after WCB directors approved its takeover offer last week.

Saputo’s offer trumped an earlier bid by another listed Australian processor, Bega Cheese, which has a 18% stake in WCB. Wilson says the large number of dairy processors in a very competitive dairy market means there

will be further consolidation.

“The Australian market has evolved quickly and we are expecting to see further consolidation,” he told Dairy News. “It will be very interesting to see what happens.”

Wilson says Fonterra remains committed to the Australian market but hinted that it may have missed a beat in its Australian strategy. He says Fonterra has performed well in Australia but was a bit slow to respond to a changing market. “We have made changes in the last 12 months but one could say we should have made those changes 24-36 months ago.”

The WCB board is recommending sharehold-

ers accept Saputo’s A$390 million offer.

Last month, Warrnambool’s board rejected a takeover bid by Bega valued at A$319 million dollars.

WCB managing director, David Lord says the company recommended

to reject Bega’s inadequate, highly conditional offer. Saputo’s all-cash offer provides greater certainty for WCB shareholders and a substantial premium for their WCB shares.”

Saputo is one of the top 10 dairy processors in

“We see Warrnambool Cheese and Butter as a platform for growth in Australia and Asia.”

– Lino Saputo Jnr all shareholders accept Saputo’s offer, in the absence of a superior proposal.

“Saputo’s offer underscores the strategic value of WCB’s assets and vindicates the board’s decision

the world. It is the largest dairy company in Canada, third-largest in Argentina and one of the three big cheese makers in the US. It exports products to 40 countries and has annual sales of $10 billion.

Saputo chief executive Lino Saputo Jnr told a media briefing that the WCB investment was the Canadian company’s first in Australia and gave it a sound base for selling into Asian markets. “We see Warrnambool Cheese and Butter as a platform for growth in Australia and Asia.”

Saputo has told WCB it does not intend to rationalise or redeploy any of WCB’s fixed assets. It will seek to expand WCB’s operations by increasing existing capacity or building extra capacity.

Bega Cheese executive chairman Barry Irvin has responded by saying his company’s original offer to WCB shareholders will remain the same in the

Saputo chief executive Lino Saputo Jnr

hope of keeping the company in Australian hands.

He says Bega’s offer, now valued at A$350 million, still has the potential to consolidate an internationally competitive Australian dairy company, despite falling short of the Canadian bid.

Irvin said he understood shareholders would make a decision in their best interests.

The Saputo offer is

contingent on a 50.1% shareholder acceptance.

“Unless they get the 50.1% acceptance, there is no offer, so the reality is we’re sitting there with an offer of no minimum of acceptance,” says Irvin.

Murray Goulburn, another major shareholder in WCB, released a statement shortly after the announcement saying it would take time to consider its options.

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Dairy News october 15, 2013

news // 5

Botulism scare: multiple flags missed andrews@ruralnews.co.nz

FONTERRA MISSED

the whey protein had to be reprocessed at Hautapu. “It should have been drafted away from human use and used for stock feed,” he writes.

The second orange flag was when the reprocessed whey powder was found to have higher, though technically acceptable, bacterial counts. “Once again, this should have been enough to restrict its use to stock feed.”

Woodford says the next flag came in March 2013, when an Australian division of Fonterra retested some of the powder and found bacterial counts further elevated.

“In all likelihood these levels were still below technically acceptable

levels, but the fact that levels had risen in the powder would have been indicative of anaerobic bacteria being present.

“Fonterra saw this as an orange flag but it should have been a red flag. All products processed at the Hautapu plant using the same production system should have been immediately removed from the supply chain and placed under bond. Instead, Fonterra decided only to do further tests.”

Woodford goes on to acknowledge the difficulty in distinguishing between the sometimes lethal botulinum strain of clostridia and the benign sporogenes strain. Agresearch reported to Fonterra it

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Date of TTP signing no problem hard to reconcile that with Wills is optimistic about the officials and people I the outlook for the TPP, met. The only stumbling despite Japan, Canada block would be a global and the US having issues economic crisis precipwith the proposal. itated by a US governHe says tariffs in counment default,” he says. tries involved in the TPP In Europe the tracost New Zealand up to $1.5 ditional “anti-free billion a year so it’s important Bruce Wills trade lobby” appear we keep chipping away at the to be softening its stance. Wills talks.

In Geneva, Brussels and Rome believes people are better underhe spoke with trade officials, hear- standing the issue of food secuing “comments by anti-TPP groups rity and climate change and that it that President Obama’s absence makes sense to head towards more would torpedo the TPP”. “I find it open trade.

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FEDERATED FARMERS president Bruce Wills says people should not get too ‘hung up’ on the need for signing a Trans Pacific Partnership (TPP) deal before Christmas.

Wills, just back from overseas where he met people negotiating the TPP, says the timing of the signing is not an indicator of its success.

“If it doesn’t happen until June next year that would be a shame and in my view the sooner the better.

But it will happen, and it may take a bit of time and we shouldn’t be too concerned if it runs past the end of the calendar year.”

in China where many of Fonterra’s products are sold.”

Woodford’s also critical of Fonterra’s communications, saying it “stumbled from one misguided communication to another”.

it was a false alarm. Further testing overseas has confirmed that in fact it was not botulinum. However, great damage to Fonterra’s and New Zealand’s reputation occurred, with the recall being splashed globally in the news media, and particularly so

looked likely botulinum was present but it was not sure.

“At this stage Fonterra did see a red flag. The Government was notified and there was a product recall,” writes Woodford.

“As events have turned out, it is now apparent that

on

two amber warnings, or “orange flags”, and, crucially, mistook a red as an orange on its way to the whey protein botulism scare, a leading agribusiness academic says.

“If only Fonterra had seen the warning flags earlier on, then all the damage could have been avoided,” writes Lincoln University professor, Keith Woodford, in an article he posted on his website during a visit to China recently.

“Here in China there is no doubt that Danone in particular has suffered

great damage, with their leading infant formula brand Dumex being particularly badly hit,” he goes on to say.

Speaking to Dairy News last week he pointed out that the article was written “before the Danone stuff” hit the headlines.

Woodford says he’s “not trying to blast Fonterra” in the article but, as he spells out, there are lessons to be learnt.

“The question Danone will be asking is why didn’t Fonterra act when it got the orange lights?”

According to Woodford’s analysis of events, the first of those orange lights went on, or rather “flags went up” as he puts it in the article, when

H

andrew swallow

Dairy News october 15, 2013

6 // news

Traders urge meaningful response to botulism scare KNEE-JERK TEMPORARY fixes to problems

in China caused by the Fonterra botulism scare are pointless, says the chairman of New Zealand China Trade Association (NZCTA).

Tim Whites comments coincide with a flurry of activity by dairy companies and dairy product producers; all have headed to China to reassure customers about the safety and quality of New Zealand made dairy products.

Prime Minister John Key says he expects to head for China, when he has the results of inquiries, to find out what happened, why and who’s to blame. During a 45-minute meeting with Chinese President Xi Jinping at the recent APEC summit in

Bali, Key discovered President Xi was well briefed on the issue, indicating that the botulism issue is big in China.

Key is understood to have been told by President Xi that food safety was hugely important in China, especially given its ‘one child’ policy. This point was confirmed to Dairy News by other China trade experts, who say while our export customers there are satisfied with our responses, convincing consumers is a far greater challenge. Big advertising campaigns would probably not be effective; instead social media networks could best communicate with now ‘very risk averse’ Chinese consumers.

White is urging industry and the Government

to work together to learn serious lessons from the Fonterra botulism scare.

He’s encouraging NZCTA members to keep watch on the China market.

“The incident has damaged New Zealand’s image as a source of safe, high quality food products and the implications of this have [hit the] earnings of a number of our members.

This is unlikely to be fully resolved until New Zealand can prove it has adequate systems in place to safeguard the industry and export markets.”

Meanwhile NZCTA supports members through this challenging time, “keenly awaiting the formal reports” but “unable to comment fully until all the facts are known. We’ve already seen

Prime Minister John Key with other world leaders at APEC 2013 summit in Bali.

this situation has again highlighted that a ‘she’llbe-right attitude’ won’t work.”

White says New Zealand industry has been under scrutiny in China and worldwide because the botulism scare dominated world business news headlines; it has called into question New Zealand’s ‘clean, green’ branding.

When all the infor-

mation from the various reviews is available, that will be the time to act decisively, White says.

“Our overseas partners will expect to see a confident response from New Zealand with assurances that our food and beverage supply chain is robust.

What is not in doubt is that continued strong relations with China are essential to the economy.”

Celebrate with us and win DAIRY NEWS is celebrating its 300th issue and you can join the celebrations with a chance to win a $300 gift pack.

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Dairy News october 15, 2013

news // 7

Long journey to Manawatu peter burke peterb@ruralnews.co.nz

THE MAIN challenge for DairyNZ’s new regional leader of consulting

officers in the lower North Island is helping farmers to improve the reproductive performance of their cows and manage their farms within new nutrient limits.

James Muwunganirwa, only a few

days in his new role in Manawatu, has already hit the road talking to farmers and telling farming leaders of his team’s goals for the year.

Farmer feedback has prompted his team’s focus on helping farmers

Zimbabwe training pays off James Muwunganirwa

JAMES MUWUNGANIRWA came to New Zealand from Zimbabwe in 2005. He had completed his BSc Agric Hons in animal science and had worked as an extension officer for the Ministry of Agriculture in his home country. (This resembles MAF in NZ’s earlier days.)

But Zimbabwe was beginning to suffer the economic problems now crippling the country.

“At that time I had a young family. Me and my wife Gladys had two kids then and I just started

thinking about the future for the family. Things weren’t looking rosy at the time and looking ahead I couldn’t see opportunities for them growing up in that environment. So I started looking around for countries where I could utilise my expertise.

“Naturally New Zealand was a good choice given that dairy farming is well set up here. A colleague of mine who had come to New Zealand in 2002 worked on farms and said ‘this is the place for you’.

So I decided to take a leap of faith

and the rest is history.”

Muwunganirwa started in South Canterbury milking 650 cows on a farm at Waimate.

He later moved to North Canterbury working as a herd manager.

Finally he decided he understood dairying here sufficiently to move into his original profession of extension officer, gaining a position with DairyNZ in Northland in 2010.

He worked there until his recent appointment in Manawatu.

improve the reproductive performance of their cows and the nutrient management issue.

He says the Horizons One Plan has been a game changer for farmers, and his staff are developing ways to help them meet new N leaching targets.

“Our role as the extension team is to provide key messages to help farmers adapt and comply with those new rules while also coming up with tools and ways of making sure the profitability of their businesses is not compromised.”

They will work with Massey University, especially the staff at No 1 Dairy farm who have configured that farm to model a dairy farm in a “sensitive catchment” where compliance with the new environmental rules is critical to the farmers’ economic survival.

Local farmers want to raise the reproductive performance of their cows and increase the six week in-calf rate to the national target of 78%, Muwunganirwa says. @dairy_news facebook.com/dairynews

Dairy News october 15, 2013

8 // news

in brief Fierce contest on the cards THE 2013 ANZ Young Farmer Contest winner Tim Van de Molen says the contest teaches entrants new things and gets them out of their comfort zone.

“You would never push yourself to do these things if it were not for the contest,” said Van de Molen, an agri manager with ANZ, at the launch of the 46th contest in Christchurch

recently.

ANZ, principal sponsor of the Young Farmer Contest since 2003, is continuing its sponsorship.

New Zealand Young Farmers chief executive Terry Copeland says it receives extraordinary support from volunteers who dedicate hours and passion for the industry to make the events successful year after year.

Stars aligning for US producers ANDREW SWALLOW andrews@ruralnews.co.nz

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years the dairy stars are aligning for US producers and a surge in exports is likely, visitors to a Lincoln University Demonstration Farm focus day heard last week.

So much so that within five years New Zealand will lose its ranking as the world’s leading exporter of dairy, predicts the university’s professor of farm management and agribusiness, Keith Woodford.

“Should we be worried?” he asked, rhetorically. “Only if we rest on our laurels.”

While heeding the need to be environmentally sustainable, New Zealand must keep seeking productivity gains, just as the Americans are, he says.

“We must also work harder on consumer brands, particularly for Asia. We are lucky the demand for dairy products in Asia, particularly China, continues to climb.” Consequently there’s room for both New Zealand and the USA in the global marketplace, he says.

Woodford’s comments come after a two

week tour of US facilities in June with Lincoln colleague and US ex-pat Marv Pangborn.

The US industry is increasingly industrial, about 40% of this year’s production coming from about 800 “mega farms” with at least 2000 cows each, and another 30% from farms with 500-2000 cows.

“Don’t be fooled by the ‘tales of woe’ in the news media about the smallscale American farms.

These farms will continue to decline but the overall industry is likely to expand,” warns Woodford.

“The mega farms have costs of production that are much lower.”

And those costs of production are tumbling thanks to a crash in the price of corn, December futures going from US$6.40/bu a year ago to US$4.40/bu last week on the Chicago exchange. “A year ago feed probably accounted for 65-70% of these farms’ total income.

Now it’s probably only 50%,” Woodford told Dairy News.

With second generation biofuel sources such as algae likely to come on stream soon – not to mention new mineral

Keith Woodford, Lincoln University, warns of a surge in dairy exports from the US.

fuel sources from processes such as fracking – the lower corn prices are likely to endure in the US, given it was largely biofuel demand that underpinned the highs of recent years, he says.

Meanwhile dairy prices have soared: Dairy America’s skim milk powder was making US$3300/t for December shipment a year ago on Global Dairy Trade.

At the October 1 auction the corresponding December contracts averaged US$4250/t. “This really starts to stack up.”

Even in June, Woodford and Pangborn found US producers looking to expand and the drivers for that have only increased since.

Compared to the US mega farms, New Zealand on-farm infrastructure is under-engineered, they note.

“We probably over-rate

some of our technology,” Woodford says. “You just need to look at the dairy sheds in the US and the quality of construction, some of it on a whole new level over New Zealand’s; but then it is operating 22 hours a day with a couple of hours for washdown, so it needs to be good.”

Those hours of operation and cows producing twice that of New Zealand’s, deliver “at least ten times the amount of milk you might have coming out of a New Zealand shed,” he adds.

Consequently overhead costs are spread much further. Production per labour unit is also high, however reliance on Hispanic workers, many without legal status, is a potential “Achilles heel”, as is shortage of water in some regions, and the dependence on bought-in feeds, Woodford adds.

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Dairy News october 15, 2013

10 // fonterra board election

Five hopefuls for three seats Five worthies raise their hands for Fonterra directorships. Dairy News hears what the candidates have in mind.

Malcolm Bailey ONLY FONTERRA chairman John Wilson and fellow director Jim van der Poel have been directors longer than Malcolm Bailey, who was elected in 2004.

But clearly the Feilding director’s passion for the role burns as brightly now as nine years ago.

“The future for Fonterra is exciting and I enjoy my part in shaping its future,” he told Dairy News last week, returning from the APEC summit in Bali.

TAF is working well, he believes, and the resulting permanent share capital means Fonterra can invest and grow with confidence.

“Farmers have seen a lift

in the value of their share investment and this is positive.”

He acknowledges a higher share price creates tension with milk growth but says Fonterra knew this was a likely consequence of TAF. “It reinforces the need to deliver improved profit to justify the share price.”

And farmers producing more milk have the opportunity to own more of Fonterra. “We have also introduced more options for new and growing shareholders to spread their share purchases over time. This flexibility was not available pre TAF.” As Fonterra grows and expands, in offshore markets in particular, it means governance skills, experience and diversity of the Fonterra board need to lift, he says.

“A key focus for me is to lead a review of Fonterra’s governance and representation to ensure the promise of Fonterra is delivered through having the right balance of elected and appointed

directors.”

Bailey lauds chief executive Theo Spierings’ leadership of the company.

“He’s a real star and Fonterra will be a stronger company as a result of the recent food safety scare.”

Besides chairing Fonterra’s governance and representation committee, Bailey sits on the audit, finance and risk committee, the cooperative relations committee, and represents Fonterra in the Dairy Companies Association NZ. Bailey is a member of the International Food and Agriculture Trade Policy Council, and a director of Embryo Technologies, Hawke’s Bay Dairies, Hopkins Farming Group and Agrico Holdings.

eric ray WAIKATO FARMER Eric Ray believes Fonterra’s board needs more manufacturing expertise.

Ray (73) joined the local powder plant at Waitoa after leaving college. It became a career choice and he ended up working in both the powder plant and butter factory.

He obtained a Diploma in Dairying (Butter Making) at Massey College.

He says a string of food safety issues, including the false botulism scare in August this year, means food manufacturing expertise is crucial,

even at the board level.

“I think farmers will benefit from my manufacturing expertise on the board.”

Ray, standing in the election for the second year running, has worked in the dairy industry in Asia so has seen how our product is handled.

He also refers to a lack

of good communication with suppliers and will push for improvements if elected next month.

Ray has been milking 110 cows on a family farm at Springdale since 1990.

Ray, 73, confirmed to Dairy News he did not undergo the CAP process, which is not compulsory. “The panel asked for two referees but none of my bosses are around; they have all died.”

Ray, who also skipped the CAP last year, says he had issues with former chairman Henry van der Heyden and current chairman John Wilson.

“I just never got a good hearing from the panel.”

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fonterra board election // 11 donna smit WHAKATANE DAIRY farmer, chartered accountant and company administrator Donna Smit sums up in three words why she’s again standing for Fonterra’s board: support, skills and spirit.

“I find the huge support I’m receiving from all over the country to stand very encouraging,” she told Dairy News last week.

Like Spaans, it’s the second year running Smit

has stood for election, having come to the fore in Fonterra politics during the TAF debate.

michael spaans IF EVER there was a time for strong governance in Fonterra, it’s now, says Waikato dairy farmer and company director Michael Spaans (50) in his candidate profile for the Fonterra board elections.

It’s the second year in succession he’s stood for the board and he supports the 3V strategy – value, volume and velocity; it’s just the execution that’s in question.

“Recently the talk has been about value and volume, but the velocity has been left off, which makes me wonder why are we not pushing that part?” he told Dairy News last week.

Implementing strategy in a timely manner is critical to maintaining and building Fonterra’s competitiveness, domestically in milk supply and internationally in markets, he stresses. “It’s so important for Fonterra to maintain its global relevance; to grow and maintain market share in New Zealand and offshore.”

Global relevance and milk supply are two of five challenges he lists in his profile as needing addressing. Milk price, with its obvious link to supply, is another; shareholder focus, and food safety and quality, complete the list.

“When we’ve seen the outcome of the milk quality reviews we have to [consider] all the findings [to avoid these problems in future].”

Under ‘shareholder focus’, he warns a strong payout alone is not enough to attract and retain farmer shareholders, noting Fonterra’s slide from processing 96% of New Zealand’s milk when formed, to 88% today.

“Fonterra must look at additional ways to help to page 13

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On skills, she lists strategic, financial and commercial experience, notably over 23 years with kiwifruit co-op EastPack, the largest post-harvest processor in New Zealand.

“EastPack employs a seasonal peak of 2400 people on seven sites and in 2011 [pre PSA] ranked tenth out of 146 companies for return on capital.”

She and husband Corrie have five dairy farms – two in the North Island and three in North

Otago. “This gives us a strong sense of the value of Fonterra the cooperative and the value it creates for farming shareholders.”

Which leads to “spirit”.

“I have a passion for the dairy industry and I want to secure Fonterra’s longterm success for future generations. I am a strong supporter of cooperatives and I believe in the elegance of the cooperative structure to maximise returns to its producers.”

Smit says she’ll bring a fresh outlook, with independent thought and a diverse range of strategic skills, to a Fonterra board that is currently “very collegial”.

A key challenge she sees for Fonterra is maintaining relevance in global markets with limited land available for conversion in New Zealand and increasing “sustainability issues”.

There are major market opportunities in Asia

and the Middle East with increasingly discerning and affluent customers prepared to pay for food that is natural, safe and of high quality. But Fonterra must improve its systems, she adds, alluding to the WPC80 scare.

“Fonterra has a great point of difference from its New Zealand competitors: it has scale in its processing facilities, it has talented people over a large geographical spread, and as a co-operative it has

a focus to maximise milk price.

“This is good for its farmer suppliers, however there will be pressure from outside investors to return a good dividend. World class performance in every measure is the best way to balance these tensions.”

Asked about TAF, a change she opposed, she says she’s impressed with Fonterra farmers’ understanding of cooperative logic, linking shareholding with milk supply.

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Dairy News october 15, 2013

fonterra board election // 13

Five-way battle for three seats ian farrelly IF YOU have only three years to give, don’t stand for Fonterra’s board, says an incumbent director seeking re-election – Ian Farrelly.

“Fonterra is obviously a large and complex business getting larger and more complex all the time. As a farmer director you have to step up to the plate for three terms [ie nine years] at least. That’s the commitment I made.”

First elected in 2007, Farrelly says it takes a term to “get your head around” the complexity of the business, even for those with directorship experience elsewhere, and it’s only in the second term that directors start to deliver “at a high level” for Fonterra.

Before Fonterra, Farrelly lead ASB’s move into agriculture, focusing on dairying. The bank gained “something like” 20% market share. He also set up the FAME (Food and Agribusiness Marketing Experience) programme for emerging leaders, and

In doing that, farmers and Fonterra need to “earn the right to grow” with the public and governments – here and abroad – managing perceptions and meeting expectations on the environment, animal welfare and social responsibility.

“We’ve taken the milk

into schools; now one of my visions is we should take the schools to the milk, so kids understand where milk comes from, and get them involved in the things we’re doing to manage the environment, like riparian plantings.”

Risk management strategies range from

financial to food safety.

“We’ve had the botulism scare but I think we have come through that in good shape and we’re stronger for it.”

Management of risk dovetails with effective execution of the ‘volume, value and velocity’ strategy. “It’s about doing it a

bit quicker, executing that strategy with the right management of risk.”

TAF, which Farrelly says is “operating extremely well”, is facilitating that. “It’s given us the strength to lift our capital investment,” he says, highlighting developments such as the Waitoa UHT

plant and Anchor brand launch in China.

But he also recognises the challenge the firm share price presents for young farmers coming in and those looking to grow.

“We’ve created a lot more flexibility but we’ve still got some way to go on that.”

is a farmer in his own right with a specialist 400ha calf-rearing farm at Te Awamutu, and 50% share in three dairy farms, totalling 2000 cows, nearby, plus a minority stake in the 9000-cow, seven-farm Canterbury business Spectrum.

He identifies five challenges for Fonterra “at the highest level”: defending and growing milk supply, earning the right to grow, managing risk, effective execution of strategy and increased capital investment.

“Remaining a powerhouse in the marketplace is incredibly important and that starts here with growing our shareholder base and milk supply.”

michael spaans from page 11

suppliers maintain and grow their businesses with better policies and regulations.”

He applauds TAF for “achieving what it was set up to do” in securing capital, reducing redemption risk and providing an option for shareholders to cash up capital. But he acknowledges the new redemption risk created by a high share price. “It’s a positive problem to have. Farmers now have their value in the company recognised on their balance sheets.”

Spaans served on the Fonterra Shareholders Council 2000-2008 and was in the first intake of Fonterra’s governance development programme.

His directorships – DairyNZ, Waikato Innovation Park, Ospri (formerly NAIT & AHB), Animal Breeding Services, Shoof International and Chilean dairy farming company Manuka SA – have built his governance experience and “wide knowledge right across the dairy industry.”

“I’ve been on a journey to get the required skills so I’d be able to contribute at Fonterra.”

If elected, he says he’ll reduce his other board commitments to make Fonterra his number one priority.

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Dairy News october 15, 2013

14 // news

‘Best-in-class’ formula firm regaining speed

Nutricia ANZ general manager Corine Tap says Karicare sales took a ‘big hit’ after the false botulism scare.

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Zealand, and Ministry for Primary Industries representatives have agreed.

“We have world-class manufacturing processes and food quality procedures in place,” the general manager of Nutricia Australia and New Zea-

land, Corine Tap, told Dairy News. “We are definitely best in class – much higher than many local standards.”

Nutricia has been working with the Government and MPI whose representatives had visited its factory and laboratory in Mt Wellington, Auckland. Nutricia medical and R&D director Gregg Ward says MPI is proactively looking at the response to the Fonterra false alarm food safety recall and what needs to occur in the future.

“We are working with them on that,” says Ward, who works in the baby nutrition division, Nutricia Australia New Zealand.

“They say certainly this is best in class and they are looking to take that forward.”

Tap says Nutricia will take part in inquiries into the food safety recall, and has told the ministries they are keen to participate. Both a ministerial and an MPI inquiry are being held.

During the botulism scare Nutricia recalled 67,000 cans of infant formula in New Zealand as they contained Fonterrasupplied whey protein product. However the company says it knew all along its product was safe as their own comprehensive testing programme showed that.

Since the recall they have made three extra commitments: “We have put extra controls on suppliers, more reaching out to parents through our Careline and innovation to continually improve being the industry leader.

That is about improving the industry standards,” says Tap. Nutricia is not considering changing ingredient suppliers. “Fonterra is one of the biggest base powder suppliers in the world and we are working with them in a collaborative way to make sure this is not going to happen again.”

Nutricia opened its doors earlier this month to key stakeholders including Government, retail partners, healthcare professionals, consumers and news media to show the level of food safety stan-

dards at its Auckland manufacturing facility. “We are confident about our own testing, and we have rigorous testing in place with more than 1000 tests on each tin,” says Tap. Their testing at the laboratory in Mt Wellington had never shown elevated levels indicating the presence of botulinum. “We were therefore surprised by the call on August 2 [from Fonterra]. However if there is any mention of infant botulinum or potential risk of clostridium botulinum coming from a supplier there is nothing else you can do other than take the recall measures; but we were not surprised to hear a few weeks later from MPI that there was no issue. We knew there was no issue because the product never tested as having any issue in our laboratories.”

Ward says had they ever detected elevated levels of SRC (sulphur reducing clostridium) they would have elevated testing to a species test using an advanced DNA technique. This is done in an accredited laboratory in Germany and takes two weeks.

Although Nutricia’s own testing did not show elevated levels at any stage, during the precautionary recall they sent samples to Germany, not only of the products affected by the recall, but other products as well, to provide transparency. The results were negative as confirmed by MPI’s own tests.

Tap says Nutricia took a “big hit” when the recall occurred but it was picking up now. “But we are working really, really hard on recovery and we hope we can be back [soon] in the position we were in.”

They were on a growth path before the recall; a few years ago they produced about 5000t annually from the factory and they now produce 20,000t.

“Karicare had been around for over 100 years and it has a strong New Zealand heritage. We are confident we can continue to grow.” @dairy_news facebook.com/dairynews

Dairy News october 15, 2013

news // 15

A trip down memory lane... inaugural sharemilker of the year winners Diane and Kevin Goble, Taranaki.

Modest tilt brought a big surprise Diane and Kevin Goble, Taranaki, made history in 1990 by winning the inaugural Sharemilker of the Year competition. Peter Burke recently visited them on their Okato farm.

JUDGED SOLELY on its view, Gobles’ farm would be hard to beat.

Out front is the wild Taranaki coast; behind, stunning picture-postcard views of Mt Taranaki and the Pouakai Ranges.

The Gobles have farmed here since 1992 and now run 620 Friesians on 240ha (200 effective), formed by joining three farms. It’s a modern farm with a 50 bail rotary and all riparian fenced to environmental standards.

Backtrack 25 years to when Gobles were sharemilking on his parents’ farm at Tikorangi near Waitara milking 240 cows. There were no national dairy awards. Taranaki ran its own competition they decided to enter, Kevin says.

“The first time I entered I was pretty green and basically didn’t prepare myself; I just went for a walk around the farm with the judges. I learned from that experience that you have to be more prepared and sell yourself and what you are doing and believe in it.

“We then moved farms and two years later entered the competition and came second. Then we entered it again and quite by chance that was the year (1990) the national competition kicked in.” They won the regional

final, qualifying for the national competition.

It was a busy time, Diane says. “I helped prepare all the bookwork and financial side of things. There was a lot to do to get things together and they wanted to have a good look at your business and especially your profitability.”

Gobles’ focus was on winning the local competition; the national event was far from their minds. “We wanted to win the Taranaki one and when we won that we said ‘we’ll put our best foot forward and see how it goes with the national one’,” says Kevin.

Judges Sir James Graham (knighted 1990) and Des Clayton visited the farm. Later the Gobles were called to Hamilton for another aspect of the judging – an interview with MP Katherine O’Regan.

“We didn’t know what to expect so we took our two young children with us to Hamilton and went away for a few days,” says Diane. “The kids were crawling around under the table while Katherine O’Regan was interviewing us. It was totally low key compared with now.”

A month later the finals night coincided with National Fieldays.

The Gobles recall a low key event in a

hotel in Cambridge, about 80 people attending – mainly sponsors, contestants and their families.

Diane and Kevin won Sharemilker of the Year, thrilled at winning. The prizes were modest by today’s standard: total value about $8000 in main sponsors’ products and a little cash. But there was more than just prizes; the event got them known, and national acknowledgement of their excellence gave their bankers confidence in them when they sought to buy their first farm.

Today they are still involved in the awards. By winning the regional final they automatically joined the organising committee of the local event.

Winning the national event also meant more work for Kevin. “I have judged the local event recently and then two years ago our manager won Farm Trainee of the Year and it was great to be with him when he won that.

“After we won I got the opportunity to judge the national competition for three years. That involved going around New Zealand seeing the different farms and meeting different people. It was quite special and great value to us, seeing other people farming in those regions.”

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25th anniversary gets organisers dancing THE 2014 New Zealand Dairy

Industry Awards will celebrate the 25th anniversary of the sharemilker competition with a review of its inauguration and and an awards night dinner-dance.

The milestone anniversary cre-

ates an opportunity to delve into the sharemilker competition history and celebrate its success, says national convenor Chris Keeping.

“It’s amazing to think that over those years thousands of sharemilkers have participated in the competition,

relishing the opportunity to have their business analysed and enhance their progress in the industry while having some fun and meeting lots of people.” the anniversary ball will follow the national awards dinner in Auckland on May 9 next year.

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Dairy News october 15, 2013

16 // news Feds Dairy chairman Willy Leferink (left) and executives Kevin Robinson (middle) and Chris Lewis visited PKE processing and storage facilities in Malaysia and Indonesia.

PKE fears put ADAM FRICKER

FEDERATED FARMERS Dairy Section mem-

bers are impressed, and surprised, at the size and quality of the palm kernel processing facilities they viewed on a recent “jour-

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feed for Kiwi dairy farmers. They reported to Federated Farmers what they saw on a five-day tour of palm plantations, kernel crushing mills and port facilities near Kuala Lumpur, Malaysia and Lampung, Indonesia. The tour was facilitated by importer J.Swap Stockfeeds Ltd and commodity trader Ameropa.

New Zealand imported 1.5 million tonnes of PKE last year, about 40% of the PKE produced in the Asia region, the remaining 60% sold to European and Asian countries. Our dairy industry has become an important market for PKE and Leferink says PKE has become an important supplementary feed for our dairy industry.

“It has saved our bacon several times, as the North Island particularly was gripped by two major droughts in 2008 and 2012. If not for PKE we would have had serious animal welfare issues and dramatic drops in stock numbers as we saw in the sheep industry [during the drought].

“PKE is a grass replacement and a balancer of feed demand over a season and… an important tool to maximise productivity.”

After their tour Leferink, Robinson and Lewis agreed the biosecurity risk posed by PKE had been previously overstated. But they are recommending to the Ministry for Primary Industries (MPI) a bolstering of New Zealand’s capabilities in screening PKE for metal contamination.

“It would be wise to further develop technical skill in metal contamination,” says Leferink.

“I’m proposing self manPKE transferred from storage to port.

agement for New Zealand importers [to screen PKE before sale] and maybe some sort of import licence. The onus should be on the importer and I think the cost should be minimal. I know Swaps already put their PKE through magnetic screening.”

Minister for Primary Industries Nathan Guy says MPI is proposing all PKE must be passed through a 4-6mm screen on entry to New Zealand and before going on sale.

Extra record keeping and traceability will also be required.

“Tough conditions are already in place for imports, including heat treatment, fumigation and inspection,” says Guy. “[And] new standards were introduced in June ensuring that in-market facilities are Government approved.”

About 70% of PKE imports are already screened in New Zealand. Leferink says all the plants the tour party visited in Indonesia and Malaysia had magnetic separators. “There are magnets everywhere but the speed at which the product is moved may hinder extraction of some metal bits.”

J. Swap Ltd already screens all its PKE in New Zealand, but not all importers do and it is not mandatory.

Lewis and Robinson say they were impressed by the quality of the plants they saw and that although lesser quality plants no doubt existed, a recent audit report by MPI to identify approved export plants gave them confidence. In June MPI released audit reports that

Dairy News october 15, 2013

news // 17

to rest Left to right, Stephen Swap, J Swap Stockfeeds, Feds Dairy chairman Willy Leferink and Alloy Wong, Sungai Budi Group look inside a PKE screw press that crushes the palm kernels to extract oil.

showed good biosecurity systems in the two main PKE-supplying countries, Malaysia and Indonesia, but recommended “some tightening up… to ensure New Zealand’s standard is met”.

Deputy director-general, compliance and response, Andrew Coleman, said the reports concluded any biosecurity risk from the importation of PKE is “very low”, but the strengthening of import requirements would be accelerated, the focus being to ensure PKE

from unapproved facilities cannot be exported to New Zealand.

Leferink also said economics meant it was more logical for importers to source PKE from the larger suppliers in order to fill a 32,000 tonne ship with the fewest possible port visits and port charges. Smaller mills could not supply the volumes the New Zealand market needed.

The Sinarmas palm oil mill in Lampung was a good example of an ideal source because it produced 1200t of PKE a day,

From palm to farm 1. Palm kernels yield valuable by-product PALM PLANTATIONS press oil from the fruits and palm kernel seeds (pictured) of the oil palm, Elaeis guineensis. This variety of palm grows only 5o either side of the equator, is productive 26 months after planting, reaches peak yield at six years of age and produces 12-16 bunches of fruit per tree per year. The bunches are cut down by hand then transported by wheel loader to the mill.

2. Screw press key to oil extraction PALM OIL is pressed from the outer parts of the fruit, leaving the edible seed – the palm kernel.

This is crushed in large screw presses (pictured) to extract oil, leaving the mashed solid part of the kernels (PKE). Previously burned or dumped, PKE is now sold as cheap stockfeed. The kernels are crushed under huge pressure which generates temperatures not lower than 85oC, a threshold set

by MPI. 3. Chris Lewis with a magnetic separator that extracts junk metal THE PKE goes via augers and conveyers into storage, on the way passing magnetic separators which remove metal junk such as sheared bolts from the presses. MPI has audited crushing and storage facilities in Indonesia and Malaysia to ensure the supply chain – from crusher to ship – meets acceptable standards and presents minimal biosecurity risk. MPI has also recommended compulsory metal screening of PKE landed in New Zealand to bolster its safety as a stockfeed.

could store 18,000t of PKE and had its own deepwater wharf adjacent to the factory.

“These operations were professional and had great respect for all attributes of their business,” says Leferink. “We are talking businesses the size of Fonterra: these operations can fill vessels on their own and the distance between the presses and the vessels is minimal. They also contract press for a lot of smaller players which makes it a lot safer for us.

“It was impressive to

1.

see their facilities and the interest they showed in us as the end user, and how they could accommodate concerns we had particularly about metal contamination.”

Lewis says all the companies the tour party visited had been “very open” and complied with all requests, at one point even stripping down a screw press on the spot. He also felt the companies the tour party visited, all food producers, were receptive to feedback from downstream users of PKE.

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18 // news

Chinese want quality products not lower prices – Wilson PAM TIPA pamelat@ruralnews.co.nz

THE CHINESE govern-

ment is investing $6 billion in its dairy industry and it wants to see consolidation of its domestic players and

on the $200 million processing plant being built by Yashili at Pokeno, south of Auckland. Wilson says Yashili has now been bought

by Chinese dairy giant Mengniu.

Mengniu and another Chinese milk powder man-

overseas companies’ dairy operations in China, says Fonterra chairman John Wilson.

It will also mean further investment by China in New Zealand dairy, says Wilson.

He was commenting

from Fonterra to further process in New Zealand and export from New Zealand.

“That’s what we are hearing, but we will see how it plays out,” says Wilson. “We are in good strong dialogue – our man-

ufacturing giant Yili are getting a major chunk of the $6 billion from the Chinese government, Reuters reports.

Wilson says he understands Yashili NZ – now owned by Mengniu – is looking to take ingredients

     

agement team with the management teams of these new entrants.”

He says it is important to look at the Chinese market in terms of the $6 billion investment announced by the government last month. Wilson says those funds are being made available for further consolidation within the Chinese dairy industry.

“They are looking for considerable consolidation domestically in their dairy sector and they have been clear about that,” says Wilson. “They also want consolidation among importers coming into the country. They don’t want to see too many players because food security and food safety is so important to them.”

Wilson says that’s why the strength of the relationship Fonterra has with the Chinese is important. “It is multi-faceted between investing in farms in China, milk powder coming from New Zealand and our nutritional products going to consumers, including the UHT launch, Anlene and Anmum.

“With that investment of $6 billion, the consolidation in that sector and the commitment to provide high quality dairy to consumers, you are going to see investments in other countries and you will see it here in New Zealand.

“It is for [Fonterra] though to ensure we have the lowest cost platform from an operating base, with further costs

John Wilson

taken out over the last 12 months, and have the right strategy.”

Wilson says the global dairy industry is a competitive landscape. From talks so far with Mengniu, who are already Fonterra customers, it would appear they want to continue that customer relationship with the Pokeno plant.

“So far what we’ve seen – and they have been very open – these new investors from this particular market; they are not coming here for lower costs, they are coming here for the quality standards we have here in New Zealand for the product and will blend that here and sell that to the Chinese market. But we will see how it evolves and it is always evolving.

“At this stage our indications are there are requests for us to provide ingredients for them to further process into final product in New Zealand.

We will see over time but that is what our understanding is. Of course through DIRA we are required to provide milk from Fonterra farmers to those plants.”

in brief



Hunt for top consultants

 THE HUNT is on for New Zealand’s top Farmax                    rural consultants in the company’s inaugural Consultant of the Year Awards.  To be announced at the Farmax consultants’  conference in Rotorua and Lincoln next month,  the awards will name top North and South Island rural consultants using the pastoral farm                   decision support software.

Farmax general manager Gavin McEwen says  the awards have been developed to recognise   the expertise of consultants using the New Zealand-developed software synonymous with   rural professional excellence.   “Rural professionals are an essential part of





  





  



   

the service Farmax offers and without their expertise in driving the application and interpreting the results it is only software,” McEwen says.

Dairy News october 15, 2013

20 // news

China growth pushing co-op’s recruiting PAM TIPA pamelat@ruralnews.co.nz

FONTERRA IS recruit-

ing at least 100 people a month in China to keep up with growth, says Fonterra chief executive Theo Spierings.

The need for sales and marketing people in China and South East Asia is growing fast, Spierings said at the release of Fonterra’s annual results.

Fonterra is very busy there: launching Anchor UHT milk, expanding its food service and Anlene product into 70 cities, launching its Anmum infant formula and starting its second hub of China farms.

“We are building the organisation…. We talk about 100 people a month;

that’s what we need to do right now,” says Spierings.

“We need to make sure we are well connected with the government, government to government and business to government.”

This is part of an overall strategy to “shift the wheel” from commodities into higher value propositions.

After years of 2-3% growth in Asia, Africa Middle East volume growth reached 11% in the 2012-13 financial year.

And Latin America had gone from annual 2-3% volume growth to 6%.

“In the emerging markets we are stepping up our gain,” Spierings says. “We are growing faster than market in those geographies and that means gaining market share.”

Emerging market

growth is driven by key countries like Indonesia, Malaysia, Vietnam and China, which have 100 million people and a growing middle class.

Across the co-op’s product range, the $1.3 billion food service business is the jewel. “We have a fantastic business model, we have grown almost double digit in volume terms and we have a strategy in place; we want to grow 20% year-on-year.”

In Anlene products the emphasis is changing from healthy bones to healthy ageing but they will not be in new countries in the next year. “So that’s where you could say we slow down a bit.

“In the maternal situation, there are lots of opportunities. Third party manufacturing for Chi-

nese customers is a big opportunity and you see this is where we go to new geographies. As we speak we launch in China and Hong Kong and we are thinking of our next geographies where we will be present with infant formula ourselves.”

Meanwhile Fonterra is going for a record production year, Spierings says.

“It looks like we are going for a record year and there is not a lot of doubt in our minds, which is strange in the second month of the year.”

They are also looking to a record payout, but this will put pressure on the EBIT (earnings before interest and tax) because of the high cost of milk which cannot be fully passed on to brands, particularly in emerging mar-

Fonterra chief executive Theo Spierings mingles with Chinese shoppers during a recent visit to China.

kets, he says.

In the last financial year New Zealand Milk production grew by 1% to 4 million tonnes, but the drought is estimated to have stalled production

by 400,000 tonnes, which would have given growth of 5-6%.

The aim now is to make New Zealand Milk world class in food safety.

“People in the markets

rate us as having blown the whistle on ourselves – we got a false positive.

But never waste a crisis; we will lift the bar on food safety quality.”

From pain to gain in Oz SORTING THE size of Fonterra’s business in Australia is coming to an end and “we are finding out feet”, says Fonterra chief executive Theo Spierings.

“We are taking $49m costs out – we took a lot of pain.” Australia has tough retailers and aggressive suppliers who set the milk price high, with processors in the middle.

“You have to make sure your value chain is efficient or you don’t get a ticket to the game. What we did last year was earn our ticket to the game.”

Fonterra now focuses on four brands instead of 21 and is committed to nutritional and food service, in which they reduced costs and took out the complexity.

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It’s not easy to see exactly what’s going on inside your cows and whether their gears are in order or are at risk of being infected with endometritis. This infection remains hidden and animals can show little or no external symptoms. Up to 20% of your herd are at risk of developing endometritis post calving, leading to reduced conception rates and therefore fewer days in milk and increased culling. This means a potential loss of revenue of thousands.

To avoid endometritis becoming a costly issue on your farm, the best practice is: A. Identify, Record, Metricheck™ and Treat all of your ‘at risk’ cows B. Have your veterinarian Metricheck™ your whole herd in 2-weekly batches from 2 weeks post-calving, C. Your veterinarian will treat all cows that show any signs of pus with METRI-CLEAN which is introduced by passing a pipette into the infected uterus of the cow.

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Dairy News october 15, 2013

news // 23

Greater focus on Maori farming peter burke peterb@ruralnews.co.nz

DAIRYNZ IS emphasis-

ing the Maori contribution to the dairy industry with the appointment of a key liaison person.

Tony Finch, Christchurch, manager for people, economics and business at DairyNZ, now has the additional role of working with Maori. He has a farming background, worked in corporate banking in the UK, and most recently, before returning to New Zealand, spent six and half years in Missouri as general manager of a large greenfield dairy start-up operation.

Finch says DairyNZ recognises Maori are large levy payers and that up to 10% of New Zealand’s milk comes from Maori farms.

“We need to pay a lot better attention to them than we have. So I have spent the last weeks building relationships and starting to understand a needs analysis, where we listen and try to drive initiatives to help Maori lift

profitability through productivity of people, cows and grass.”

About 20% of Maori make up 80% of the production – the larger trusts such as Wairarapa Moana in the central North Island and PKW in Taranaki, Finch says. He also notes the expansion of the Miraka Dairy Company near Taupo. Many of these farms are large and have a “corporate flavor”, he says.

“We are trying [for] ‘whole farm assessments’ which are pretty much a SWOT analysis to see what their strengths weaknesses and opportunities are. From that we try to get some commonality about where we can deploy some initiatives to add value.”

Finch sees in some larger incorporations a lot good governance; he cites PKW as an example. Some are exceptional, some average and others below average, consistent with the dairy industry as whole, he says.

Reaction from Maori is positive; they are excited about what DairyNZ is

Awuwhenua awards open MAORI DAIRY farmers, trusts and incorporations are being urged to enter the prestigious Ahuwhenua Trophy for excellence in Maori dairy farming for 2014.

The competition alternates each year between dairy and sheep and beef and in 2014 it’s for the top dairy farm. Also held in with the dairy award is the Ahuwhenua Young Maori Farmer of the Year contest.

The trophy was granted 80 years ago by the Maori leader Sir Apirana Ngata and the then governor-general Lord Bledisloe.

The chairman of the management committee running the awards, Kingi Smiler, says the objectives of these two great men in encouraging Maori to improve their land and increase production still hold today.

“While farming systems and technology have changed, the Maori value of kaitiaki of their lands for future generations remain. The judging criteria remain the same with the farms being assessed on their overall performance, including financial, governance and community engagement.”

Entries close late November and the award will be presented in Tauranga in June. Field days will be held in March on the farms of the three finalists in the competition.

A book tracing the history of the Ahuwhenua Trophy and Maori agriculture will be launched at the Federation of Maori Authorities annual conference next month.

trying to do, he says. “They see the potential and that DairyNZ is a major industry player working for them. It’s very promising thus far, the relationships

we have with them.

“The social and cultural aspects are different and there’s a lot of tradition I find fascinating. It is different so there is probably

more of a need for ‘fit for purpose’ ways of developing capability and capacity within the Maori dairy sector,” he says.

Tony Finch

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Dairy News october 15, 2013

24 // news

Extra staff for huge UHT plant start-up peter burke

Miraka’s UHT plant under construction.

peterb@ruralnews.co.nz

TAUPO DAIRY processor Miraka is hiring 38 new staff, needed early so that its UHT milk plant can be ready for business early in the new year. Chief executive, Richard Wyeth says some staff are already training at another plant to gain experience for when the Miraka plant is commissioned.

The $27 million plant will produce UHT (long-life) milk for the dairy firm Shanghai Pengxin, specifically for the Chinese market. The new plant is huge, much of the space devoted to storing the product before it’s shipped overseas. Milk supplied to the factory is not diluted or reduced to make UHT milk.

So Miraka will get 60 million litres a year from farmers and the same quantity will be exported.

The project manager for the new factory, Brian Coates, says there are significant differences between the processes for producing ‘fresh’ milk and ‘long life’

milk.

“Pasteurised milk as we know it in the supermarket has been [heated] to 72oC for 15 seconds then cooled. It can then be kept in the fridge for about a week. This includes all types of fresh milk – trim, lite and full cream. UHT on the other hand is heated to 140oC for four seconds and that’s termed as ‘commercially sterile’ and doesn’t need to be cooled.” It can last six-twelve months at room temperature.

The new plant is divided into separate areas, the main processing taking place in the ‘wet’ area where the milk is heat treated and the protein in the milk ‘standardised’ so the customer gets a consistent product all year round.

“It takes away the seasonal variation in protein and fat. Then we have our steriliser in the wet process room, where the milk goes forward at 20oC for filling into Tetrapak 250ml cartons,” Woodford says.

Flexibility for tax payments FARMERS CAN defer provisional

tax payments to the IRD, says a tax payment intermediary.

Tax Management NZ (TMNZ) has launched Pay My Tax, a system allowing taxpayers to shift their provisional tax payment dates to a time that better suits their business.

Available as an app or through www.paymytax.co.nz, this is a convenient self-service option “giving farmers financial flexibility. It lets taxpayers leave cashflow in the business for as long as possible, so they can pay for the things they really need to do.”

TMNZ chief executive Chris Cunniffe says he sees businesses of all sizes and from all industries that want to hold on to their cash or defer their tax payments for as long as possible.

“The Pay My Tax app provides businesses with flexibility in when they pay their provisional tax.

There is no credit approval process required, no security needed and no need for face-to-face discus-

sion with customers. The service is online and confirmed automatically.

The finance is generally provided for 3-12 months and can be extended up to 18 months. It’s less than the cost of a traditional business overdraft facility and it’s tax deductible.”

TMNZ is a tax pool registered with the IRD and it makes the tax payment to IRD for the customer.

“We have been doing this for over 10 years and helped our clients achieve huge savings,” says Cunniffe.

It is particularly useful for those who need to use their cashflow for business expansion and growth, and for those with incomes that vary from year to year.

Dairy farmers can shift the payment dates for their tax to a time that better suits them. They can also defer all payments until the end of the year.

Farmers have the security of knowing the tax is reversed for you in case you need it and there’s no risk of IRD penalties or use of money interest. Interest cost starts at 5.4%.

My maize silage is here whenever I need it

LEON SMETS, WAIKATO DAIRY FARMER

Growing & feeding Pioneer® brand maize silage

SEE LEON’S STORY AT

pioneer.co.nz 0800 PIONEER 0800 746 633 Pioneer® brand products are provided subject to the terms and conditions of purchase, which are part of the labelling and purchase documents. ®, TM, SM, Trademarks and service marks of Pioneer Hi-Bred International, Inc.

Dairy News october 15, 2013

world // 27

Argentine soy processor saw better future in dairying gordon collie

SINCE TAKING a moth-

balled milk powder plant off Nestle’s hands in 2002, the Frederico Boglione family business La Sibila has made strides in dairy processing.

Boglione travels widely looking at processing and packaging technology and has begun selling specialist powder products in many countries. The family formerly processed soybeans, but sold that business in the late 1990s, turning instead to milk processing to complement dairy farming interests.

The Nestle plant at Nogoya, in the central Argentine dairying heartland, was processing 500,000 litres of milk a day when it closed in 1998. Since rebuilt, it now has four processing lines handling 1.2 million litres of milk a day. A new $10

million powder packaging extension will soon be commissioned.

Another small Nestle plant 375km away at Villa Neuva was acquired in 2009, giving the company about 1.5 million litres daily milk intake.

Boglione soon saw there was no future competing in world commodity powder markets dominated by such suppliers as New Zealand. “We had to build direct marketing relationships with customers and supply them with finished products they wanted.”

The business uses equipment from Spain, Denmark, France, Australia and New Zealand to make milk powders for food, industrial and pharmaceutical end users.

Some products are vitamin enhanced, and fat filled with vegetable oils.

A move into baby formula has taken qual-

vir_0290_penclox_sheriff_new MWHP4_Dairy NEWS AD 1-3PG.indd 1

Fredrico Boglione

ity control standards to a demanding new level.

Milk powder prod-

uct packs range from one tonne bulk bags for industrial customers down to 5g sachets of coffee whitener.

Now La Sibila has struck a licencing agreement with New Zealand company Frucor Beverages to make V energy drink for the South American market.

La Sibila has expanded its dairy herds on two properties in the central region. Its 5500 cows producing 180,000 litres of milk a day are said to make it the second-biggest dairy

The La Sibila plant at Nogoya has powder processing lines and automated handling equipment.

farmer in Argentina. It also buys milk from 220 farmers milking about 60,000 cows up to 350km distant from the Nogoya factory.

Because much of their business is in direct consumer products, Boglione says the company has

year-round milk intake and encourages a flat production with no more than 20% variation between seasonal peaks and troughs.

Exports now account for about 60% of La Sibila production. The main

brand is Purisima.

The family also raises beef and crops. Including two properties near Buenos Aires its total landholding is 40,000ha. They farm 20,000 beef cattle and have pioneered canola growing in Argentina.

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8/10/13 1:09 PM

Dairy News october 15, 2013

28 // OPINION Ruminating

EDITORIAL

Fonterra faces stark choices in Oz

milking it...

Synlait pushes boundary WE KNEW the season was off to a good start – but using milk to put out fires?

You’ve got to be joking!

Of course we are, but the heading of a media release from Canterbury processor Synlait earlier this month prompts our musing. It read, ‘Fire brigade calls for help and Synlait Milk responds.’ Well if they’ve got so much of the white stuff that they can do that, why are they still taking DIRA milk? Fonterra suppliers might ask. Actually, Synlait’s paid for a new emergency response vehicle for the Dunsandel fire service, so good on them.

Powered by poo Ivan waves his big stick – Effluent – often a headache for dairy farmagain ers – could soon prove beneficial by offsetting electricity bills, recent research shows. As part of the Southland Energy Strategy, Venture Southland has been working with other parties trialling the capture of methane emissions from covered anaerobic effluent ponds on dairy farms. The idea was to show methane could be used as an energy source to reduce electricity use on farms and to reduce greenhouse emissions. Methane produced from a covered effluent pond is collected and used to generate electricity.

Data collected by Niwa had shown how viable the technology was.

RUSSIA IS notorious for using trade as a diplomatic weapon. Earlier this month Russian authorities criticised the quality of Dutch dairy products and hinted at possible sanctions in an escalating row between the nations sparked by the arrests of Greenpeace activists and their vessel, which is registered in the Netherlands.

And other European dairy producers are also feeling the wrath of Moscow. Russia’s consumer safety watchdog said recently it was ordering a ban on Lithuanian dairy products over doubts about their safety following the Baltic state’s attempt to draw ex-Soviet countries such as Ukraine closer to the 28-nation bloc. Remember, Russia was one of the first to ban New Zealand dairy products after the false botulism scare. The ban was later lifted.

Forget the mower, get cows

THE DEBATE about who should mow grass on Auckland’s berms has suggested a dairy connection. A New Zealand Herald commentator suggests Auckland

follow New Delhi’s lead and let cows get rid of the grass. “Anyone who’s tripped around India knows the traffic-calming effects of randomly wandering cows on city streets,” he says. “Once drivers realised a half-tonne of meandering beast could be lurking behind every parked car, hooning down Ponsonby Rd would rapidly become a thing of the past.”

THE AUSTRALIAN dairy industry is taking another step away from consolidation.

The fractured industry continually talks about the need to improve farmer returns but no one is putting their money where their mouth is.

The arrival of the Canadian giant Saputo means another player in an already overcrowded market. It still leaves many farmers facing the risk of being forced out of business as profit margins fade and major retailers – Woolworths and Coles – dictate pricing.

Dairy Australia figures show in 1980 there were 21,994 registered farms in Australia, but in 2012-13 this number had declined to 6398.

The Australian dairy industry is almost two-tiered: Queensland, northern New South Wales and Western Australia are domestically focused, accounting for about 25% of the industry.

The other regions are export focused, with some domestic production. In Victoria, Tasmania, southern New South Wales and South Australia, milk from dairy farms end up mostly as milk powder, yoghurt, cream and cheese for export to Asia and the Middle East.

Fonterra is revamping its Australian operations. The co-op says it is watching development in Australia with interest.

But it would not be content being a bystander as Australian processors are snapped up. Five years ago, it lost the battle for National Foods to Filipino conglomerate San Miguel, who later sold it to Japanese drinks giant Kirin. In 2008 Kirin also bought Dairy Farmers, a co-op.

Fonterra cannot afford to miss the boat again in Australia.

Fonterra has trimmed its Australian brands from 21 to 4 to make its value chain more efficient.

However, to remain a major player it must ensure there’s enough milk to process at its plants. Media reports say Fonterra and the China Investment Corporation are making a joint bid for Van Diemen’s Land, a major dairy operation in Tasmania.

VDL already supplies Fonterra, so the bid is more to protect its milk supply base.

But the battle for Australian milk will only get fiercer.

Fonterra must protect its market share while looking to increase its milk supply base. Saputo’s arrival only means more competition.

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Dairy News october 15, 2013

opinion // 29

Innovation will drive primary sector growth Minister for Primary Industries Nathan Guy recently addressed the Primary Growth Partnership Expo in Wellington. Here are excerpts from his speech; THE GLOBAL food market of the 21st century is changing rapidly and there are great opportunities for our food sector, particularly in Asia.

Our business growth agenda (BGA) includes a goal to lift the ratio of exports to gross domestic product to 40% by 2025.

We look to the primary sector to lead the way. To achieve this ambitious goal we will need to dramatically lift productivity.

The ability of our primary industries to do this will underpin our future competitive advantages.

benefit to the wider economy will be at least $7 billion per year by 2025.

PGP activity is intended to support innovators to deliver long-term economic growth across the sector. It does also, therefore, mean taking some risks.

Our pastoral industries are well represented in the range of PGP programmes.

Government has committed, for example, $84.6 million over seven years to a programme called ‘Transforming the Dairy Value Chain.’ The focus here is on developing new

tion, Miraka Ltd and Kanematsu New Zealand Ltd. This programme aims to create a niche and to help develop Maori agribusiness capability.

I want to express once again my enthusiasm for PGP and the positive momentum it is gathering.

I am excited by the way it is generating tangible opportunities for innovation, growth and value-add of our food exports.

Nathan Guy

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And this is where our I like the Nevada PondBoom because it’s safer and easier to manage pump Growth than having it on floating pontoon.

Inathe important dairy flagshipthe Primary sector, a programme Partnership (PGP) policy – Whai Hua – is lookcomes in. Through the ing to develop immuPGP, Government is now nity-enhancing dairy milk providing a springboard products targeting healthfor innovation. conscious consumers in Government and Asian and New Zealand industry have agreed to markets. co-invest $684 million in The programme has 16 projects to boost proreceived $3.5 million in ductivity and sustainabiljoint funding from partity in the primary sectors.

This will be a serious capi- ners Wairarapa Moana tal injection. The potential ki Pouakani Incorpora-

In conclusion, achieving the export growth we are seeking as part of our growth agenda will depend on improved productivity through innovation. The PGP is providing a unique and valuable springboard for this activity and I look forward to seeing the current programmes’ progress, and more programmes coming on stream.

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Dairy News october 15, 2013

30 // opinion

Headlines a cause for celebration PETER FLOYD

TWO RECENT headlines in farming newspapers encouraged me greatly: ‘Fewer cows can mean better profits’ and ‘Applied nitrogen not always profitable’.

Both arise from papers

by Chris Glassey of

DairyNZ. The first was presented at the SIDE conference in July, and essentially it challenged the idea that running more cows always leads to more profit. Trials on Ruakura farmlets have shown that, rather than pushing carrying capacity to the limit, many farmers would be better off reducing stock

numbers and doing the herd better.

Today’s highly productive cattle need more and better feed, and reducing the herd size makes more feed available per animal, reduces costs and often results in more milk solids overall. Glassey quoted the case of a

farmer saving $1000 for every cow dropped.

Production improved and he was able to make more silage for autumn use.

The second paper, to be given at the November Grasslands Conference, gives the results of farmlet studies comparing nitrogen use with a

Peter Floyd

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no-nitrogen regime. The idea that putting on nitrogen does not necessarily produce more profit may be a surprise to some farmers but not to me or to eCOGENT members.

The outline of Glassey’s paper given in Rural News September 3, indicates that for six years out of nine, the profit from the no-N farmlet was about the same as from the farmlet getting 181kgN/ha/ year. In the other three years the nitrogen farmlet was more profitable, i.e. the value of the extra milk solids it produced more than offset the higher production costs.

The interesting thing is that pasture on the no-N block contained twice as much clover and, probably as a result of this, summer production was higher.

There were also more pasture species (including some weeds).

These results confirm the experience of many eCogent farmers who have reduced or eliminated N fertiliser and have found this made little difference to overall profitability. They also found that animal health costs went down and visual assessment scores for pasture and soil improved

sions on the amounts of supplementary feed needed, nitrogen use, optimum calving and dryingoff dates, and so on. And their decisions are tailored to their own farm business circumstances and not based on rules of thumb or local averages. The tools work for farms ranging from 135 cows to very large herds, and can lead to annual profit increases of 10 – 30%.

Getting back to nitrogen, I believe steering clear of N fertilisers gives other benefits less easy to quantify. Heavy use of N produces a near monoculture of ryegrass high in N – what soil scientist Graham Shepherd calls “high octane” feed that results in more N being passed out of the cow, overwhelming the capacity of the environment to deal with it. Heavy N applications are also a likely cause of soil carbon loss. Avoiding N is a part of the strategy a number of farmers are using to achieve small, regular increases in soil carbon.

For years I have been saying farmers should base their management decisions on profitability, and not on assumptions or the urgings of banks, dairy

“For years I have been saying farmers should base their management decisions on profitability, and not on assumptions or the urgings of banks, dairy companies or farm supply companies.”

Overall they have found they are financially better off with less or no N. They can say that with certainty because the management system they use involves close monitoring of the farm business environment including detailed analyses of pasture and animal production and associated costs.

These figures allow the use of two powerful decision making tools: a daily profit indicator that allows rapid assessment of the effects of any changes in management on profit; and a herd size indicator that gives the optimum number of stock for the business at any one time.

These two practical tools enable farmers to make more accurate deci-

companies or farm supply companies. Reducing N use and lowering stock numbers are realistic and usually profitable management options that may be forced on farmers to protect the environment.

Our experience is that if it is done carefully using the right business tools, farm profits should certainly not suffer in the short term. In the longer term, profits will be more secure because the production system and hence the business will be more sustainable.

• Peter Floyd is the managing director of Cogent Farming Business Systems Ltd www.profitfocusedfarming. com phone 0800433376 or 0275968796

Dairy News october 15, 2013

agribusiness // 31

Colombians take keen interest in NZ farming tony hopkinson

PRIMARY INDUSTRIES Minister Nathan

Guy is delighted with Colombian farmers’ keen interest in New Zealand farming, evident during their visit here last week.

Guy, who in March invited Colombian farmers during his visit to Bogota, says he had expected 10-12 people to accept. But 170 turned up, to be hosted at the National Fieldays’ New Zealand Agribusiness Centre at Mystery Creek

by New Zealand Trade and Enterprise and the New Zealand Government.

Guy was on hand to welcome the visitors, saying “the size of the delegation highlights the importance of working together and building

closer links to this important part of the world.”

MPI will work with Federated Farmers and other farmer organisations to organise events such as field trips and farm visits, he says.

“The board of the World Farmers Organisation has welcomed the initiative, presented to it by Federated Farmers president and WFO board member, Bruce Wills. This builds on the work of the Global Research Alliance (GRA) which New Zealand helped to establish in 2009… aimed at increasing international cooperation to reduce emissions and enhance productivity.”

The visitors were from Fedegan (Colombian Federation of Beef and Dairy Farming) which has 50,000 members. Each

3000 cattle, 150 staff RAFAEL ENRIQUE Amaris (pictured) farms in Atlantico region, on the Caribbean Sea, near its capital Barranquilla.

This northerly region has generally hot weather.

He farms 2500ha of flat land and runs 3000 head of Brahman and Brahamcross cattle. Last year he had a Braham bull judged the best in Colombia.

His farm has extensive plantings of African palm trees for harvesting coconut oil.

The farm employs 150 staff.

year they organise groups to visit and learn about the agriculture of another country.

The Colombian cattle farming industry, with five million cattle – a similar size to New Zealand’s – is keen to learn about our simple and efficient farming.

The Colombian dairy herd average size is only 10 animals.

The visitors heard, via a translation service, from Nick Dromgool, general manager commercial, National Agriculture Fieldays, and from Dr Carlos Severini, chairman of Fedegan.

DairyNZ chairman John Luxton explained the setup of the New Zealand dairy industry, the changes over the years, its size and its place in the world dairy product exporting scene.

John Caradus, chief executive of Grasslanz, in a technical paper, explained the production of grass seed in New Zealand, its establishment and potential for use in other countries. Haylon Smith

spoke for NZTE. The Colombians looked at displays by 18 National Fieldays exhibitors, ate lunch and visited a local dairy farm.

MPI Minister Nathan Guy (left), Carlos Severini, Fedegan chairman and DairyNZ chairman John Luxton at Mystery Creek.

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Dairy News october 15, 2013

32 // agribusiness

Ruatoria man enjoys stud-station life tony hopkinson

HANGAWERA STATION’S

fifth annual sale of Polled Hereford bulls cleared 150 head of 30-month, 24-month and 18-month-old animals all for service bulls for the dairy industry.

The station is a Tainui Group Holdings property and the sale is run in with Stoney Creek Herefords, a small stud owned by the station manager Ian Mathieson and his wife Petula. The sale was first held at the Morrinsville saleyards for two years, the last three on the station at Tauhei near Morrinsville.

Joint agents RD1 Livestock and PGG Wrightson ran the sale on Monday October 7. All stock were grazed on the farm until Friday Oct 11 then were trucked away, all transport costs paid by the vendor.

The station is 700ha (eff) of rolling to hilly country in an area prone to summer dries. It has been managed

Ian Mathieson

for eight seasons by Mathieson. We enjoy working here and appreciate the excellent facilities and we get on well with the Tainui Group Holdings management group.”

All stock are purebred – 30% bred on the farm and the rest sourced from studs and recorded herds in the north and south islands. Where possible the farm buys back all the 18-month-old bulls when their service time is up.

Mathieson prides himself on the

quietness of his stock, their ease of handling and quality. “When they arrive they are put in a mob with no changes until they are sold and leave the station, so there is little fighting.”

As well the animals are rotated around their own units/blocks and brought to the yards for drenching etc, and with feeding out in the winter they are well used to humans.

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Go online to foil arsonist starlings RURAL INSURANCE provider FMG is launching the next phase of its tractor fire awareness campaign which includes an online game offering farmers and growers advice on fire prevention.

As spring and summer draw near birds, especially starlings, look for warm and dry places to build their nests, FMG says. “One of their favourite spots to do this is the engine space of tractors,” says general manager for advice and insurance Conrad Wilkshire.

“Starlings can build these nests in [the minutes] it takes farmers and farm staff to take a break. Unawareof what’s happened, farmers start their tractor, the engine heats up and it can soon go up in smoke causing disruption.”

FMG has worked with the National Rural Fire Authority to create an unusual

campaign called ‘Stop and Pop’.

“Through YouTube and direct mailers we created the ‘Starling Gang’ whose tractor arson pasttime could be thwarted by taking the time to ‘Stop and Pop’ the hood of the tractor to check for nests.

“Now into its third year, ‘Stop and Pop’ has been expanded to include an online game www. sparkworld.co.nz. This year’s campaign also reaches out to farm staff and not just farm owners, so everyone using tractors can be aware of nesting birds,” says Wilkshire.

Over the last three years, ‘Stop and Pop’ has helped reduce tractor fire claims with FMG by 40% saving farmers time and money.

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Dairy News october 15, 2013

agribusiness // 33

Tax case highlights costly issue owned by different entities with some form of lease arrangement entered A RECENT Taxation Review Authority decision, into with the entity carrying on the farming busiwhich ruled in favour of Inland Revenue, highlights ness for the use of the land. an important tax issue for Important tax issues farmers which could prove costly – very costly in fact, arise with such arrangements which should be depending on how many addressed when the land is years tax assessments are purchased. These include: open to reassessment by ■■ GST – the GST position Inland Revenue.

Farmers typically, and of the purchase needs for good reason, put the to be confirmed. Genownership of their farm erally the purchase of property in a different farm land should qualentity (often a trust or ify for 0% GST proI likecompany) the Nevada PondBoom because vided it’s safer easier from the entity theand purchasing to manage the pump thanfarmhaving it on a floating which carries on the entity is GSTpontoon. regisPAUL HODSON

ing business. It’s not uncommon to have different blocks of farm land

Lease arrangements – a formal lease arrangement for the use of the land by the farming business should be entered into. A fair market rent needs to be established and this used as the basis for the rent payable.

But the big issue under dispute in the Taxation Review Authority case was the entitlement of the entity carrying on the farming business to claim a tax deduction for the interest costs associated ■■

tered and some other requirements are satisfied.

Synlait helps fire service SYNLAIT MILK has funded a new emergency

response vehicle for the Dunsandel, Canterbury, local volunteer fire service.

The vehicle was presented by Synlait Milk managing director John Penno who says Synlait is happy to respond to a call for help.

“Being able to give something back to our local community, which we are committed to, means a lot to us.

We saw this as a great initiative we couldn’t help get behind.”

Chief fire officer Ian Chatterton sees a great boost in being able to give extra help to the existing fire truck and water tanker during local emergencies.

“The support by Synlait Milk is fantastic. The vehicle will respond to emergencies in all weathers and allow us to access remote areas, secure the scene of motor vehicle accidents faster, and respond to priority one medical emergencies in support of ambulances.

“We will also use the vehicle for non-emergency events within the local community like fire safety promotions and the fire wise programme at schools.”

More is coming for the Dunsandel service, where $15,000 has been raised. They want medical and road safety equipment, chainsaws, hand tools and safety equipment and a garage next to the fire station.

with the bank loans raised to purchase the farm land.

Inland Revenue successfully argued that the interest could not be claimed, leaving the farmer with a much higher taxable income and tax payable than had been filed. This seems unfair as the money had been borrowed to fund the purchase of the land and the land was being used in the farming business.

The difficulty for the farmer is that tax law looks only at the position

of each entity, not a group of taxpayers. Because the company that borrowed the money was a qualifying company, the usual statutory entitlement to deduct all interest cost did not apply. It needed to satisfy a nexus test which questions whether the interest cost is directly associated with the deriving of taxable income of the taxpayer or carrying on a business for that purpose. Because the borrowed funds had been on-loaned interest free to

unfair tax result this dispute highlighted. But this needs to be reviewed at the time the farm land is purchased. Getting some accurate tax advice at that time is important.

• Paul Hodson is a tax partner with BDO Chartered Accountants in Tauranga, an independent member firm of the BDO New Zealand network. www.bdo.co.nz Paul Hodson

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another entity (to fund the purchase of the farm land) the statutory test was failed. The interest cost was not deductible to the entity carrying on the farming business.

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Dairy News october 15, 2013

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time on a dairy farm. In Northern Victoria we are now starting to irrigate, cutting and making silage, calving the last of the spring calvers and thinking seriously about the upcoming mating by starting pre-synchrony programmes, not to mention planning summer forage options.

With so many things competing for your time it is hard to always stay on top of the critical animal health issues that need attention day to day and month to month.

I have written before about the importance of protocols when managing the health and welfare of herds. Basically, a protocol is a recipe book, a playbook we simply follow and know that as we tick all the boxes we are covering all the important aspects of that part of the production system.

My mum was always a big list writer; every day she would write down what she hoped to do that day, and scratch jobs off as they were done. The things not done today were transferred to tomorrow. She never once forgot me at school; never did I have to do the 4:15pm ‘walk of shame’ as my children

have been confronted with many times.

To address this problem, I have put in place a two-alarm protocol: the first warns me of the upcoming school pickup time, allowing me to make alternative plans with my nursing staff; a second failsafe alarm tells me that I must look sharp.

This is an example of me putting in place a plan, a ‘protocol’ to ensure a better outcome where I had failed previously.

Most of us have what I call ‘head protocols’, those we carry around in our heads. They are the little failsafe rules and checklists we have made over our lives as we have learned from our previous mistakes. Many times have I heard a dairy farmer lament how he went away for a weekend and the relief milker stuffed up, allowed a cow to get sick beyond repair or whatever, and how they can’t get

good staff and that their kids just don’t do things right.

There is a long-held view that you can’t put an old head on young shoulders, but I would argue that having written protocols for pretty much everything will ensure the less experienced employees and family members can benefit from the experience you have acquired. By working with your dairy veterinarian wherever animal health or welfare is concerned, the protocols will also reflect the specific knowledge a veterinarian can provide.

The reason why less experienced staff and family members tend to overlook problems those who are more experienced can clearly see is simply because they do not have the benefit of our learning; it is actually the failure of the experienced person for not providing adequate supervision or written instructions or checklists to ensure the best outcome rather than the inexperienced persons fault for simply not knowing.

A good protocol can also address errors that can become costly as new employees and young family farm helpers progress from the stage of

unconscious incompetence (where they actually know they don’t posess the skills required and actively seek help) to a stage of conscious incompetence (where they are conscious of the skills required, think they have them but actually don’t, and don’t ask for help). This stage where employees have a little knowledge and thus feel able to tackle bigger projects is where having good protocols and checklists can allow them to perform at a level above their experience. They are benefiting from the combined experience of those who have written the protocols. It is leaving a worker at this stage of their development in charge without the benefit of supervision or protocols that causes the lamentable outcomes.

Unfortunately, there is no such thing as a one size fits all protocol. Every farm is subtly different in its aims, physical resources and personnel. A good protocol has to take into account the limiting factors while aiming for a good outcome.

• Rob Bonanno is a past president of Australian Cattle Veterinarians Association and a director of the Shepparton Veterinary Clinic.

Dairy News october 15, 2013

management // 35

Quad safety back on the radar THE GOVERNMENT

continues to push farm quad safety in a bid to cut injuries and fatalities.

Fronting the campaign, the Ministry of Business, Innovation and Employment demands that riders always wear a helmet, that they get training and experience on these machines, that children must be kept off adult machines, and that the machine must suit the task – especially when towing a load or carrying passengers.

If quad riders on farms stick to these rules they will crash less often, and if they do crash the effects will be less serious, the ministry says. Spring brings longer working hours and a greater chance of a quad crash, so farmers and their families must do better safetywise.

“We have run a quad safety programme for two and a half years, and as spring approaches, we will be stepping up our visits to farms to ensure these machines are being

operated safely,” says the ministry’s national programmes support and design manager, Francois Barton.

Every year, 850 people are injured on farms riding quads, and five die. Many injured could not resume work for a week or more.

If you can’t work, you can’t farm, says Barton.

“Farms are workplaces and farmers [must] ensure the health and safety of themselves and their staff.

Farms are among the most dangerous workplaces in New Zealand, the ministry says. “Quad bikes are a major factor in this, but one easily preventable if these machines are respected and used correctly.

“Most farming injuries happen on flat terrain, in fine and dry conditions.

It’s important not to get complacent when using a quad bike. Keep employees, family members and your own safety at front of mind.”

Landcorp said earlier

this year it will not use quads on its new farms, and will limit their use elsewhere as it looks for a safer and more suitable alternative.

Employees were trained to use quads, were

The government is stepping up farm visits in a bid to reduce quad accidents.

required to wear helmets and the vehicles were well maintained. Yet many crashes occurred, some on gentle country in the middle of paddocks. www.dol.govt.nz/quad-bikes/ index.asp

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Why should people wear helmets?

Wearing a helmet can greatly reduce the seriousness of injuries suffered in a quad accident. Helmets can be the difference between walking away from an accident and suffering a life changing brain injury or death.

Quad makers recommend riders wear a helmet. They are basic safety equipment and there are helmets specially designed for quads.

In 40% of the fatal farm quad accidents investigated by the Department of Labour from 2000 to 2008 the victim had suffered head injury.

Why shouldn’t kids ride adult quad bikes?

Generally children don’t have the strength, body weight and mental ability to master the active riding techniques need to safely control a quad.

This is reflected by the fact that the minimum age limit set by quad makers on adult machines (over 90cc) is 16 years.

Why is it important that farmers ensure riders have enough training/experience?

Research shows that having no formal training contributes to the severity of quad crash injuries.

Before anyone rides your quad assess their skills. If they need training the best option is a skill course.

What should people consider when choosing the right vehicle?

When considering if a quad is the right vehicle for the job pay close attention to what your owner manual says about maximum towing and carrying limits, and whether passengers can be carried. Most quads used on New Zealand farms are designed for one rider and the makers say they should not be used to carry passengers. If you need to carry passengers and your quad isn’t designed to do that, the safest option is to use another type of vehicle.

About 7% of serious farm quad accidents reported to the Department of Labour between 2000 and 2008 involved passengers. 10% involved towing.

Dairy News october 15, 2013

36 // management

Lynda Clark

Helping each other deal with stress FREE ONE-DAY work-

shops this month and next will teach North Island rural Kiwis how to help neighbours, friends, employees or clients

affected by stress.

It’s been bad since the drought last summer, says Dairy Women’s Network, running the workshops – called MH (Mental

Health) 101 – at Palmerston North, Taupo, Waipawa, Gisborne and Whangarei.

The Ministry of Health is also involved, as part of

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social sector agencies. a dairy industry effort to support farmer health and This enables them to recwellbeing. Funding is from ognise, relate and respond to people in mental disDairyNZ and the Govtress or mentally ill. ernment via the Primary MH101 is developed Growth Partnership. and taught by Blueprint Each workshop is limited to 22 people, bookings for Learning, which has customised the workfirst-come first-served. shop’s content for the Dairy Women’s Netrural sector. It suits agriwork spokeswoman business professionals Lynda Clark says burnsuch as vets, accountants, out, fatigue and stress are worse after a big event like rural bankers and farm consultants, as well as the drought.

“In the past year we’ve farmers.

Workshop bookings talked to 506 dairy farmare essential. ers about their emotional wellbeing at our Tel. 04 381 6395 Health Pitstops, run by www.dwn.co.nz.

AgResearch and the New Zealand Rural Institute for Health.

Many farmers wanted to know more about coping mechanisms.

“Also, [farmers ■■ Palm erston No rth: are] under-reportOctober 24 , Bentleys ing mental [probMotor Inn, 67 Linton lems]. The hard Street. man-farmer stereo■■ Tau po: Novem ber 13; type isn’t a rural Lakeland Resort, 28 2 myth; it exists and Lake Terra ce. affects how farm■■ Wa ipawa: No vember ers prioritise their 14; Waipa wa Municip al mental and physiTheatre, 16 Kenilwort h Street. cal wellbeing – in ■■ Gis many cases it’s borne: No vember at bottom of the 20; Qualit y Hotel Em erald, 13 Gla list.” dstone Ro ad.

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THE FIRST water take consents to be issued to dairy farmers under a lower cost “group consenting” process are being dispatched by Waikato Regional Council.

Each of the 206 groundwater consents in the Waihou catchment, to be posted within the next few weeks, will cost farmers about $800 instead of the $1500-$3000 likely for individual consents.

Group processing is being done under the new Variation 6 rules, which require consent for a range of water takes. Generally dairy farmers need a consent to take more than 15m3 water per day for dairy shed use.

The council introduced staged implementation whereby farmers in various catchments met deadlines for their applications, allowing simultaneous processing at lower cost. Waihou was the first catchment to get group processing.

“The cost savings in Waihou are pleasing,” says Variation 6 farm water project manager Amy King.

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Dairy News october 15, 2013

38 // management

Fun team well equipped for Grieves have owned for seven years, milking 600 cows on a seasonal system.

Willowford, a dairy unit of MAUNGATUTU STA536ha, was bought by Doug TION Ltd has two farms: Grieve three years ago. one at Waiwhare, 40km “It was ideal – only from Hastings on the recently conroad to Taihape verted to and another at Grieve dairying, and Patoka inland runs a two a going confrom Napier.

The company herd policy cern, adjacent to our is a partnership except for two sheep of Doug Grieve, the winter. and beef his father Peter properties and their fami- They are and with lies. divided an excelMangatinto “highs range of utu Station is a and lows” – lent buildings,” sheep and beef says Grieve. unit of 2441ha, the higher The buildthe other farm and lower ings included – Whakapirau producers. a 60-bail Station, 600ha rotary with a – also raises De Laval plant with milk sheep and beef.

Meanwhile, the Patoka meters, automatic cup removers and an in-shed farm – Hawkston – is feeding system. There are a 291ha dairy unit the TONY HOPKINSON

two parallel Herd Homes 60 x 10m which can hold up to 200 cows each and with shade cloth and ventilation can be used in the summer; these feed directly into the dairy shed. There are two large silos and a roller mill with augers to feeders in the dairy and a 12 bay shed ideal for calf rearing.

Grieve’s dairy unit is 66% flat, the balance rolling, and he leases a further 160ha of rollingto-steep land for a run-off.

The farm is surrounded on three sides by Tutaekuri River, the Otakarara Stream and areas of native bush and is adjacent to the Kaweka State Forest.

Annual rainfall is 1100mm and the area is prone to summer dries but does grow well in the winter. Soil is Matapiro silt loam which is free drain-

ing and in winter there are odd flurries of snow which rarely settle. The area is 280m above sea level.

Both dairy farms supply Fonterra and Grieve uses Ravensdown fertiliser after regular soil tests and consultation with their company’s agronomist.

Willowford calves 640 Friesian cows in the spring

and 320 in the autumn. All calves are reared and leave the farm at weaning and are grazed at Mangatutu, with heifers returning when due to calve and the beef is finished. “We have no non-milking stock on the farm at all

Doug Grieve in front of silos holding 40 tonnes of wheat each.

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Dairy News october 15, 2013

management // 39

productivity annually in turnips as part during any part of the of a regrassing scheme season.” and Grieve buys in 400t Grieve runs a two of maize silage. As well he herd policy except for the has grown under contract winter. They are divided 160t of wheat which is into “highs and lows” – stored in two the higher and silos adjacent lower produc“We have no to the dairy ers.

The farm is non-milking and processed centrally raced stock on the through a roller mill and and formerly farm at all fed at every the cows during any milking. The would travel wheat straw up to 2.2km to part of the and some the furthest season.” barley straw paddock; now are also fed as the maximum a supplement. distance is 1.8km with all About 220ha of the paddocks over that disfarm can be irrigated when tance planted in lucerne. needed. “Last year we irriThere is now 32ha of gated 120ha and the year lucerne. before that because of the It is cut and carried as wet summer we hardly had green feed from October to irrigate at all.” through April and fed out Effluent is spray irriin the Herd Homes before gated over 50ha and there or following milking.

About 15ha are planted is “lots of storage” for

times of bad weather. The two herd homes are emptied twice a year. Each home is done overnight with two contractors operating and using the farms’ own effluent spreader so the home can be used by the next morning.

Willowford employs a farm manager, Stuart Johnstone; 2IC is Sharon Cadman, who has been with Grieve from the start. There are also a tractor driver and two dairy assistants for calf rearing. All staff are in radio communication and Grieve insists they all wear helmets when using the farm bikes. “We have a fun team and work well together; having good facilities helps to retain top people.”

The farm’s target for the 2013-14 season is 440,000kgMS.

Doug Grieve says the Herd Home keeps cows in top condition.

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Dairy News october 15, 2013

40 // management

OAD research peter burke

FARMER INPUT is

set to drive a once-a-day (OAD) milking research project at Massey University’s No 1 Dairy unit.

The project is part of a major revamp to have the farm model a ‘sensitive catchment’ and to deal with restrictions on dairy

Tom Phillips says farmers will have a say in running the Massey University farm.

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farming as imposed in Horizons Regional Council controversial One Plan.

A 45-person advisory group of farmers is being formed to help Massey staff in the research project; 15 of the group will OAD farmers.

Major changes have been made to the farming system at No 1 Dairy – from a 360-cow twicea-day (TAD) split-calving operation to OAD with just 240 cows. Project manager Tom Phillips says they selected 200 cows from the TAD herd primarily on BW – in this case 114.

They chose cows with low cell counts, tending towards younger cows.

Massey was given 40 Jersey cows by Jersey New Zealand that fitted the project criteria.

“Worldwide farmers lead innovation in technical expertise and researchers tend to come along behind and clarify something as being successful.”

“We have purchased 21 heifers from an OAD herd so that gives us a bit of buffer,” Phillips says.

“It’s… about what an OAD herd can do.

“The long term goal is 1kgMS/kg liveweight. That involves very tight selection pressure.

“It may require culling up to 30% of the cows each year in the initial stage to get the very best genetic cows. It also involves ensuring the reproductive and mastitis management is on top so we are not losing cows because they

are not in-calf.”

Phillips says they have a ‘social’ objective for OAD – getting to about a 40-hour week for farm staff. Getting staff for dairy farms is difficult and OAD may solve this for some people.

Another challenge is OAD conflicting slightly with some environmental goals where nitrate leaching is slightly higher on OAD than TAD, “simply because cows are in the paddock longer.

“Some of these goals appear to be in conflict

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The farm milks once-aday with 240 cows.

Dairy News october 15, 2013

management // 41

part of revamp Massey University ViceChancellor Steve Maharey and guests at the No. 1 dairy.

but long term I think they won’t be.”

Massey is emphasising farmers’ involvement in the new research at No 1 Dairy; their experience will “accelerate” the research, Phillips says.

“Worldwide farmers lead innovation in technical expertise and researchers tend to come along behind and clarify something as being successful.

But the leading innovation comes from farmers.

“There are issues where a research organisation or a university sets out to lead the way and then delivers the information down to farmers.

[Nothing] could be more insulting to farmers and…

it won’t work.” (Remember the late Gladys Reid, whose claims that zinc was a cure for facial eczema were rubbished for years by scientists, who eventually had to concede she was correct.)

Bullet-riddled knowledge transfer now ‘going feral’ MASSEY SOCIAL scientist Brennon Woods is expressing strong opinions in his major contribution to the No 1 Dairy revamp, including the OAD project.

He will examine knowledge transfer from scientists to farmers and vice versa. Better interaction between primary sector participants is the “absolute key to agricultural development in New Zealand,” Woods says.

“The principal issue for me is the extent to which OAD farmers are sharing knowledge amongst themselves and with other farmers. There is a well established discussion group in the lower North Island – with Professor Colin Holmes – that involves hundreds of farmers.

“A new one is starting in Waikato and there’s apparently one starting in Southland so you’re at a point where you feel farmer-to-farmer transfer of knowledge can have some impact on the dairy industry and that’s vital for innovation.”

Woods says the art of technology transfer was ‘shot to pieces’ in the 1980s and the “knowledge transfer system is now going feral”.

“There is real concern in the industry that everybody is getting into the extension game.

“Name any vet, seed or fertiliser company not getting into extension.

So there’s a risk of too much noise in the system and the truth can be

Brennon Woods

tainted.

“Farmers we work with place high value on science and they already operate in noisy channels with people pushing wheelbarrows all the time in respect of new products and services.”

Woods says the challenge for No 1 Dairy is to distance itself from the information clutter and retain the scientific character of the farm which will give farmers confidence in the data produced. The ‘farmer partner network’ being established at No 1 Dairy is designed to expand farmer networks and help spread research information.

Woods says it’s impossible to talk

to large numbers of farmers but he hopes the network will be an effective communication channel. “If you are starting to look at ways farmers share knowledge with each other it’s a completely different knowledge system.

They are much more dialogic and much more on an equal footing but they are sharing experiences based on knowledge about what works on their farms.”

Another challenge is getting scientists to improve their communication skills.

Many older, more experienced scientists are used to dealing with famers and communicate well. Now the process needs speeding up.

Dairy News october 15, 2013

42 // management

Farm remodeling will ring-fence environment risks PETER BURKE peterb@ruralnews.co.nz

MASSEY UNIVERSITY is remodeling its No

1 Dairy farm in part to help local dairy farmers deal with Horizons Regional Council’s One Plan.

Professor of dairy production systems Danny

Massey University’s No1 dairy farm.

Donaghy, heading the project, describes No 1 Dairy as an “environmental test bed” for One Plan – an attempt to reduce dairying’s environmental footprint in sensitive catchments.

While No 1 Dairy is not in a sensitive catchment, Donaghy says it will be set up and managed to mirror

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a typical dairy farm in such a location. The farm is changing to OAD, is reducing cow numbers, carefully managing fertiliser use and setting aside land for riparian planting and for crops that will not be grazed.

“The farm is close to the Manawatu River which periodically floods and there is a direct risk – if animals are grazed in parts of the farm – that some nutrient will end up in the water. We know we can drastically reduce the nutrients by having the cows graze only for a couple of hours and come off to other parts of the farm.”

The ultimate plan is to monitor and measure everything that moves on the farm. Donaghy admits it will be a massive challenge, handling all the data gathered. “We are putting in technology including individual [animal] ID systems, weighing and milk recording systems.

We are talking to companies about putting boluses into cows. We’ll have tags on the cows’ legs, collars around the cows’ necks, in-line recorders in the milking parlor to measure the temperature of milk and we’ll be sub-sampling for quality.”

To cope with the massive amount of data other Massey departments will get involved, including the mathematics department. Practically every department at the university could have a role at the new No1 dairy, including the school of aviation, though Donaghy admits that would be a long shot.

“We have precision agriculturists, mathe-

Danny Donaghy

maticians, engineers, the school of design and land surveyors. We have people… who traditionally don’t use the farms doing so now,” Engagement with the public and policy makers is another aim. A farmer network is being set up and schools and community groups invited.

Donaghy says the farm because of its proximity to Palmerston North city is a great way to showcase how food is produced safely and in an environmentally friendly way.

Donaghy wants to engage with central and local government policy makers and says both sides can learn from each other.

Policy makers are often better in tune with the latest trends sweeping the world and this knowledge can help researchers.

But No 1 Dairy is primarily a research farm where students are taught, Donaghy says.

“We want to demonstrate such things as best practice in managing people, animals and the environment, and technology and systems.

But some demonstration farms extend out further and further and try to be everything to everyone.

We don’t want to do that.”

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CANTERBURY MILK processor Synlait Milk is supportive of the investment by AgResearch in its campus infrastructure.

Synlait milk managing director John Penno says there is recognition of the growing importance of Canterbury as an agricultural powerhouse.

Dairy News october 15, 2013

management // 43

Dung beetles have been released on a South Wairarapa organic dairy farm.

Dung beetles to improve soil, pasture quality A SOUTH Wairarapa organic dairy

farm last week became the first in the North Island to release dung beetles into the environment to help improve soil health and pasture productivity.

Two new species from Europe – onthophagus taurus and onthophagus binodus – were released on to Ian and Heather Atkinson’s farm near Pirinoa by representatives of Greater Wellington Regional Council and Landcare Research. About 500 dung beetles were released.

Animal dung covers about 700,000ha of pastoral land in New Zealand. Dung beetles use the faeces of animals for food and reproduction, eventually breaking it down into a sawdust-like material.

The process gets rid of the dung and improves soil health and pasture productivity, reduces water and nutrient runoff, and has been shown to reduce parasitic infection in livestock.

The release is part of a project

started by the Dung Beetle Release Strategy Group to help improve the productivity of New Zealand farms and reduce the impact they have on the environment. The Wairarapa release was the second to take place in New Zealand, after a Southland farm introduced dung beetles to its soil last month.

Greater Wellington Regional Council team leader for pest plants Richard Grimmett says the council hopes other organisations will follow suit. “The benefits of releasing these beetles in New Zealand far exceeds the costs to bring them here.

This is an initiative [could] drastically improve the health of our region’s farms and our environment.”

Andrew Barber from the Dung Beetle Release Strategy Group (DBRSG) says the release marked the end of a long process to get the beetles introduced.

“Dung beetles [could] transform New Zealand’s pastoral- based agri-

cultural system. More production at a lower environmental cost….”

The beetles were initially held in containment by the Ministry for Primary Industries, then were mass reared and cage field trialled.

The Environmental Protection Authority welcomes research from the Ministry of Health and from Landcare Research that supports the release of dung beetles in New Zealand. The EPA approved the release of 11 new species of dung beetles in 2010, after an application from the Dung Beetle Release Strategy Group.

Following the decision, some people voiced concerns. In response, the Dung Beetle Release Strategy Group investigated the concerns raised, and the Ministry of Health commissioned a report to evaluate the risk to human health.

The findings confirmed the original decision to allow the release of dung beetles was sound, the EPA says.

More reliable bulls from LIC LIC IS in the market with a new genomic system

designed to improve on the previous method reducing over-estimation of genomic breeding values.

The co-op says it will bolster farmers’ confidence that predictions are more accurate.

LIC scientists has for three years been researching to improve the accuracy of prediction for genomically selected dairy sires. Following peer review by three independent scientists, the model has been endorsed for release and was included in LIC’s genomic animal evaluation run last month.

LIC launched genomically selected bulls in 2008. New Zealand was then one of a number of countries investing in genomic selection, it says.

“A common frustration in many countries has been a tendency to over-predict the bulls’ potential.

The new system is one outcome of LIC’s genotyping of about 8000 sires and 60,000 dairy cows over the

last three years.

“The resulting genomic information was combined with phenotypic information, from LIC’s Sire Proving and herd testing, generating [data] for the selection of its bull teams and to refine the statistical evaluation of genomically selected dairy animals.”

The co-op expects 90% of the genomically selected sires used in the past three years – yet to obtain a daughter proof – will move back in their genomic breeding worth (gBW) by a weighted average of -20 to -35 across the different bull teams from these years. Half of this movement will be reflected in the juvenile progeny of these sires.

This new method of evaluating genomic sires marks another phase of evolution in animal evaluation methods, similar to when BW was introduced in the mid 1990s and when the test day model was introduced in the mid 2000s.

Dairy News october 15, 2013

44 // animal health

How many cows in your herd DairyNZ has run 27 heat detection workshops in recent weeks.

Andrew Swallow reports from one at Te Kinga, on the South Island’s West Coast.

HOW MANY cows in your herd are cycling? Do you even know?

Ten days prior to start of mating, 75% of the herd should have been observed bulling, rising to 85% at start of mating, if industry targets of 90% submission in the first three weeks and 78% in-calf at six weeks are to be achieved, farmers at a DairyNZ heat detection workshop at Te Kinga, Westland, heard.

The workshop was one of a series of 27 nationwide in recent weeks highlighting the importance of correct and timely identification of cows in oestrus as a driver for profit, and the techniques to improve performance in those areas.

At the Te Kinga work-

shop LIC’s Belinda Fentiman and local DairyNZ consulting officer Ross Bishop relayed the principles, pointing out six week in-calf rates have been declining since the 1970s, to just 62% nationally last season. “Good heat detection is a real driver to improving that,” stressed Fentiman.

Bishop recommended breaking targets down to numbers per week which should, on average, be observed and, in due course, served (see table).

However, staff must recognise they aren’t numbers which must be achieved. Too much pressure in that respect risks cows being listed as in heat “to make the numbers up” when in fact,

they’re not, he warned.

For example, farms with a legacy of extended calving would struggle to achieve the targets without some form of intervention to bring late calvers on heat, he noted.

Fentiman added that hungry, poor condition cows, and “dirty” cows (ie suffering from endometritis or other post-calving problems) are other drivers of non-cyclers.

LIC’s Fertility Focus reports will highlight whether cows not on heat are being put up for service, and possibly a host of other things going on in heat detection and mating.

The ideal bar-graph picture is ‘The Whale’, with most intervals between observed heats occurring

Tall cow? Move the heat detector back a bit, says CRV Ambreed’s Amanda Skeggs.

in the 18-24 day window.

The nightmare is the ‘Manhattan skyline’ graph where returns to heat are all over the place.

“This report is available four weeks after start of mating if you get your dockets out quickly,” says Fentiman.

Having one or two suitably skilled and responsible people on the farm managing heat detection is the best approach, she

believes.

While Bishop echoes that, he suggests the whole team needs to be on board, understanding why heat

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Dairy News october 15, 2013

animal health // 45

are cycling?

Cows in herd Industry target

150

300

450

600

750

75% cycled @ 10 days PSM

113

125

338

450

463

85% cycled @ PSM

128

255

383

510

638

90% submission 3 weeks after PSM

135

270

405

540

675

45

90

135

180

252

6

12

18

24

30

Weekly average to reach 90% @ 3 weeks Daily average to reach 90%@3 weeks detection is important to the business and knowing what they can do to help.

Besides checking tail paint and/or other heat detection devices as the herd comes through the shed, observation in the paddock a couple of hours after milking is a good practice. Often cows on heat will be in sexually active groups – or ‘SAGs’.

“The SAG group tends to hang around the water trough because they have an elevated body temperature,” Fentiman notes.

In the shed, that elevated temperature can be checked by placing a hand on the suspect cow, and on the one next to her (hopefully not in heat) to see if there’s a differential. If in doubt, put the cow out and watch for while, suggests Bishop.

“If she’s going to come into heat, she’ll become part of that (SAG) party pretty quickly.”

The run-up to mating is an ideal time to practice such observation skills and check all other procedures are in place and functioning, he says.

“Probably the biggest resource you have to commit initially is time: time to identify any gaps in skills and address those gaps.”

Those gaps may include language, literacy and numeracy, so information gathered about which cows are on heat can be accurately relayed, as well as techniques such as tail painting, positioning of detectors and recognising signs of bulling.

Paint should be applied in a strip as wide as your

thumb is long, starting from the head of the tail along the spine for about the length of an A4 piece of paper – about 20cm, explained Fentiman. Work paint in against the grain of the hair, and give the bottle a good shake before starting to ensure the paint’s well mixed.

For other heat detection aids, such as Kamars, Scratchies or Estrotects, the standard position is on the spine between the pin bones, but some adjustment should be made according to the size of the cow relative to its herd mates.

For smaller animals put them further towards the head, larger, closer to the tail; it’s all about putting the detector where the brisket of a riding cow is most likely to rub.

“Have a look at the height of the cow and pull it back a bit if she’s particularly tall,” recommended CRV Ambreed’s Amanda Skeggs, who was demonstrating application of EstroTect strips.

Whatever the brand of stick-on detector, it shouldn’t be applied over tail paint, and long hair should be trimmed so the patch can’t move.

Fentiman says for products which use glue, the glue must be warm to stick. “If you read the instructions you can’t go wrong.”

If cows are chewing detectors – a problem more often encountered with heifers than mature cows – try painting with equine anti-chew coating, Crib Stop, she suggests.

“You can get it from CRT.”

Less is more for host farmers HENRY AND Liz Raymond, who hosted one of the West Coast DairyNZ heat detection workshops, are in their seventh season at Te Kinga on a 320ha property they own in partnership with Henry’s parents.

They moved there from Southland and milked 820 cows initially, but in recent seasons that’s been cut to 750.

Meanwhile there’s been a 24% benefit in the vat. “Production’s gone from 215,000 to 267,000kg of milksolids.”

This season they’re targeting 280,000kg and as of the end of September were “well ahead” on budget.

Achieving a tight calving pattern has been part of that success, with 90% of the herd submitting within three weeks, and 86% in-calf at six weeks last season. “We looked at a CIDR programme last year but when we talked to our vet it turned out it wasn’t necessary.”

Empty rate has never been more than 7-8% and reducing the herd size has allowed them to gradually take out late

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Workshop hosts: (left to right) Mackenzie, Liz, Pippa and Henry Raymond.

calvers, and ensure the remaining herd is in better condition. In turn that’s boosted production and fertility.

An 85ha run-off is used to rear youngstock.

Until last winter all cows were wintered-on with about 30ha of kale grown. However, modest yields at 8t/ha due to the country and climate, but

with all the usual growing costs, prompted a change in policy.

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Dairy News october 15, 2013

46 // animal health

Phantom cows haunt herd fertility WORK BY a veterinary researcher on ‘phantom’ cows and their effect on a herd’s reproductive performance is the subject of a Zoetis national road show this spring.

Dr Scott McDougall is presenting a summary of recent research to help the nation’s vets.

A ‘phantom’ cow is

Dr Scott McDougall

one not detected in oestrus (heat) by 25 days after insemination, but then determined to not be pregnant at pregnancy testing.

Says McDougall, “You are left with this concern: what is it about these cows that causes them to be this way, and how can we better avoid them?”

Typically a vet may find

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at pregnancy testing time 5-15% more empty cows than the farmer may have expected, as a result of the phantom cows not being discovered earlier.

McDougall described a complex mix of physiological, pathological and managerial factors that make detecting and reducing phantom cow incidence a

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challenging one.

“Short returns” that is cows that ovulate (and show heat) 10-14 days after a first mating occur in perhaps 75% of cows bred at the first ovulation after calving.

Such cows have a very low chance of getting pregnant. However a farmer has no way of knowing whether or not the heat he observes is in a cow having a first ovulation and heat after calving.

Add in risks of embryonic mortality and poor heat detection, and it was understandable farmers were getting higher than expected incidences of phantom cows, McDougall says.

“UK research shows us that about a third of cows didn’t follow the textbook when it came to having normal ovulation cycles.”

He said using techniques like fixed time AI introduced an even higher risk of phantom cows occurring: about 43% of treated non-cyclers that did not conceive to the first breeding did not return to heat at 18-24 days after mating in one New Zealand study.

“But for farmers using that technique, in their eyes those cows have been bred, and haven’t returned to heat and are assumed to be in-calf, but in reality they have not conceived.”

McDougall’s advice to vets and farmers was to look hard at a herd’s nonreturn rate at week five of mating. If the non-return rate was more than 70% -- particularly where that

group included treated for non cycling – “alarm bells should be ringing.”

“Realistically the first service conception after a non-cycler treatment rate is about 40% and only about 50% in cycling cows, so if you get 70% not returning in week five, it can’t be correct, there must be cows in trouble there.”

Minimising the risk of phantom cows occurring involved the familiar InCalf messages of feeding prior to calving, having a 5.0 to 5.5 body condition score (BCS) at calving, and adequate feed levels post calving.

The use of re-synchrony programmes without pregnancy testing was an option, but McDougall cautioned that using progesterone alone had a negative effect on first pregnancies.

Confirming pregnancies using early pregnancy detection before initiating treatment was an option.

But as these treatments may affect existing pregnancies, accurate early pregnancy testing is critical. A South Island trial with 1800 cows conducted

by Oamaru veterinarian Mat O’Sullivan found resynchronising had the best effect in low body condition score phantom cows (BCS 4.5 or less) whether or not they had been treated as non-cyclers earlier in the breeding season.

When resynchronised the thinner phantom cows experienced a significant increase in their 10-week in calf rate.

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Dairy News october 15, 2013

animal health // 47

Lynn and Alistair Candy

Better mating management saves money gareth gillatt

BETTER USE of genetics software has saved money for Far North monitor farmers Alistair and Lynn Candy.

Candys own a 479ha dairy farm 10km east of Okaihau, operating as the DairyNZ Far North monitor farm. They got involved in this scheme to improve mating times and tighten up calving patterns.

In 2010 only 40% of the herd had submitted to mating within the first six weeks, just 24 of the farm’s first calvers had submitted in the first three weeks and the overall empty rate was at 10%. This was retarding the farm’s by $76,000, said LIC Northland representative Bob Wood at a DairyNZ field day on the monitor farm.

Empty cows are worth $1000 less incalf cows, and tighter calving rates lead to more milk in the vat, so Wood says it doesn’t take long to work out the cost of stretched calving periods or empty cows.

“I presented to Alistair and Lynn this information. They were missing out on $76,000 and that turned a big light on for them.

“There is money to be made in the six week submission and there is certainly money to be made in the empty rate.”

The Candys have taken a number of steps to improve this, lifting average body condition score from 3.5 in September 2011 to 4.4 this September.

Extra care and attention had resulted

in a 72% six week in calf ratio this season compared to 66% this time last year. “Every percentage point of submission will bring you 0.5% return in conception.”

The couple also watched for and recorded pre-mating heats to bring the calving period tighter and Wood says it stops cows falling through the cracks.

“If you don’t do pre mating heats you don’t know what has cycled, whether they’ve cycled and what you are going to do about it. It’s good to get those pre mating heats so you can aim at something.”

Going back through the detailed report was also a good way to spot potential problems not immediately apparent, says Wood.

Information like submission rate, conception rate, calving spread, non return rates and heat detection benchmarks are included in the report. Wood says it will enable farmers to identify problems they might not have been aware of. “By drilling down into herd records we can pull out a lot of stuff that you didn’t know was going on. You can drill down into the age groups and see if there are any common trends.”

If R2 or R3 cows are emerging as a problem, information like the first day of calving, last day of calving and planned calving date is also useful, Wood says. “By looking backwards you can see where you’ve come from and where you’re going.”

He says farmers can feed cows preferentially, and put them on OAD milking.

Mate heifers first MATING FIRST calvers first will futureproof tighter calving, says LIC Northland representative Bob Wood.

Wood told attendees at the Candy field day that futureproofing tighter calving patterns meant getting heifers into the system early.

Wood says mating heifers 7-10 days before the rest of the herd would make sure R2s would start on the right foot. “It’s critical to get them into a pattern they will continue for the rest of their lives. If they calve late here they will certainly calve late the next time they come round.”

Wood also says farmers must

ensure the first-time calvers get enough to eat, perhaps by once-aday milking regime or feeding them more. Heifers must be fed enough to keep condition on them through the all important mating period.

The Candys had gone an extra step in weighing heifers once a month at the suggestion of the monitor farm management group.

It proved to be a valuable exercise, Lynn Candy says.

Heifers are weighed on a scale set up on the race. Getting the weights provided a lot of information about heifer stock condition and allowed them to act faster when considering which animals to feed more.

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Dairy News october 15, 2013

48 // animal health

Tackling mastitis at Oz farmers’ fingertips AUSTRALIAN DAIRY

farmers can now use a “world-leading” smart phone app to tackle mastitis. Dairy Australia is the developer and dairy farmers and advisors may

download it free of charge.

Countdown Mastitis Toolkit app was designed in consultation with dairy farmers, advisors and vets. It is based on the Countdown 2020 masti-

tis control programme and associated resources.

Dr John Penry, one of the Dairy Australia-led team that helped create the app, says farmers may use it to access data

anywhere at any time.

“Whether you want to know a liner change date, the health of cows’ teats or information on teat disinfectant, this app is comprehensive, up-to-date

and easy to use.”

The app is divided into four sections: tools, topics specific to common mastitis control, Countdown farm guidelines, and related articles, tips and

Victorian farmer and vet, Zoe Vogels finds the app easy to use.

traps.

South-west Victoria farmer and veterinarian Zoe Vogels was also part of the team that created the app. With her husband, brother-in-law and two farm staff she runs a 600cow dairy farm at Scotts Creek.

She found the app easy to use and an invaluable resource, particularly for newcomers.

“It’s pretty much everything you need to know from calving to drying off.

It doesn’t need [phone] reception once you have

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downloaded it – useful for people like me who have patchy mobile reception.

“I see it being invaluable for anybody new to the dairy industry and also for milkers in the dairy, advisors, milk factory field officers, vet students and vets.”

The app was tested by dairy advisors at Countdown 2020 meetings in 2012 and fine-tuned at trials this year by farmers and advisors.

Available for iPhone and Android phones, it can also be used on tablets.

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ronment for slug numbers to multiply.

And Ravensdown agrochemical technical manager Jeremy Klingender says the slimy molluscs are now ready and waiting to damage emerging pastures and crops.

“Last autumn’s booming slug populations put huge pressure on establishing pastures and crops.

The mild winter has done nothing to quell these numbers, which will cause significant damage to spring pastures and crops if not brought under control,” he says.

“Monitoring the slug population present in paddocks is extremely important because just a small number will cause serious, yet barely visible, damage.

To monitor the slug population, place a number of sacks in the paddock concerned and leave them for a couple of days. If around 3-4 slugs are found sheltering under each sack, they are likely causing economic damage to crops and pastures.”

He points out that controlling slugs is an on-going process that must continue throughout the season, until crops are well established.

To complicate the situation, slug baits act differently on slugs at different developmental stages.

There is always a range of slugs at various developmental stages at any time in one paddock,” he says.

“Managing the differing life stages of slugs may require multiple applications of slug bait to ensure crop damage is reduced. The more slugs present, the more applications of slug bait needed to control numbers.

“The active ingredient of slug bait influences the number of times you can apply it each year to an establishing crop.”

Dairy News october 15, 2013

hay and silage // 49

Cut your silage losses MOST LOSSES that occur when you make silage are invisible, says DairyNZ. But they can be up to 40% of the original cut pasture.

Losses occur as sugars and protein in the grass is broken down by enzymes and bacteria.

This process starts as soon as the grass is cut. Losses decrease quality as well as quantity, because it is the highly digestible components that are most rapidly broken down.

Losses during harvesting Losses depend firstly on the dry matter content of the pasture you ensile, as shown in the following table:

do field losses.

Fermentation losses: Plant sugars are used up during fermentation to make acid. In poorly preserved silage, protein and organic matter can also be lost because of air in the stack, or a high pH. Fermentation losses are lowest in pasture which is above 25% DM. Effluent losses: Silage effluent is surplus water from the silage, which carries soluble sugars and proteins with it as it flows out.

Effluent is produced from silage made out of low DM pasture.

Above 30% DM, no effluent losses will occur.

Heating: in dry grass silage

nutrients into heat.

Optimum DM for silage is 25-30% because total DM loss is minimised, and effluent losses will be minor. To achieve this: ■■ Cut in the morning of a sunny day, for rapid wilting. Cutting after 1-2 days sunny weather will result in good sugar levels in the pasture, even when cut in the morning.

■■ Avoid wilting for any more than 24 hours. Compact the silage well. In a stack or pit, use the heaviest wheeled vehicle available. Tractor wheels should not sink into the pile of pasture any further than

■■

■■

■■

■■

dm loss in...

DM% At ensiling

Field

Fermentation

Effluent

Total

Heating

20%

2

8-10

3

0

14%

30%

5

6

1

1

13%

40%

10

5

0

3

18%

■■

■■

50%

15

7

Field losses: As cut pasture waits to be picked up, sugars are lost through a process of respiration. Drier pasture is more likely to be lost while being picked up, because it is more likely to break up or blow away. As the DM% of the pasture increases, so

0

it is a challenge to achieve good compaction. Poor compaction causes air to penetrate the stack once it is opened. When air is present, yeasts are able to generate heat from sugars and even from lactic acid and cause losses by converting these

27%

5

■■

the depth of rubber. For baled silage make sure a high density baler is used.

Seal the stack completely with a weighted, airtight cover.

Wash old polythene before use to avoid contamination with the wrong bacteria.

■■

■■

Don’t re-open a covered stack to add more pasture on another day.

Where concrete-lined pits are not full, make a concave, not convex, top, to avoid water seeping down the side of the pit.

Losses while grass is in the stack, pit or bale Once the silage is sealed, nothing can be done to change the fermentation process. A good fermentation relies on no air being in the silage, and having plenty of sugar available to turn into lactic acid. Poor fermentation leads to major losses of protein quality. In poorly preserved silage protein is broken down into ammonia, which decreases the feed value of the silage.

Getting things right while the grass is being harvested will maximise the chance of having a good fermentation: A fast wilt to 25-30% DM will leave good sugar concentrations in the pasture.

Quick compaction and effective sealing will keep out oxygen, making conditions more suitable for bacteria to convert sugars into lactic acid.

Fast production of lactic acid will quickly reduce the pH, to prevent protein losses.

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■■ Cut silage off the face, rather than pulling it off. This keeps a smooth surface at the stack face, which reduces

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Leave the stack face open on dry days to avoid heat build-up under the polythene.

Do not feed out more than one day in advance, especially in summer.

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Exposure to air leads to deterioation SILAGE BEGINS to break down once exposed to air, and will begin to heat up as micro-organisms turn the remaining sugars and protein into heat and energy.

When feeding out, aim for as little time as possible between exposing the silage to air, and the cow eating it.

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Dairy News october 15, 2013

50 // hay and silage

Implement quality makes couple come back for more TAUMARUNUI FARMER Ron Carey

sticks to a philosophy of ‘if it’s not broken, why fix it?’

So he’s he’s sticking with Lely, he says. “I won’t change from Lely because I’ve had such a good run with them.”

Carey and wife Sandra own a farm and run a contracting business, making balage and hay and doing general cultivation.

It’s a two-person operation: Carey does the mowing and baling, and Sandra does the raking, wrapping and most of the stacking. Together they make 6000 bales a season.

They’ve had a lot of Lely mowers over the 19 years they’ve been at their current property. Carey

says one of the initial attractions was the service from the Lely dealers, Giltrap in Otorohanga, and the fact the mower needed low power. He is now on his sixth Lely mower.

The latest one is a Splendimo 320MH centre pivot and was new last season.

“Centre pivot mowers follow the ground far better,” Carey says. “There is less stress on the mower at the end of the cutter bar.” Few of the paddocks the Careys work are flat so the centre pivot is vital.

“In a lot of places the tractor is leaning one way and the mower the other.

If you’re going through a V-shape valley with the tractor on one-side, the

mower will lift up to 35° on the other side of the bank.

“The Splendimo 320MH copes equally well with grass and oats in any conditions. It flies through whether it’s long, short, wet or thick. Also the hydraulic break away system works extremely well.”

Carey says the blades are quick and simple to change. The option he ordered has two inner and two outer swath discs on the cutting bar to bring in the swath in so Sandra can rake up three mower widths.

In 2011 Ron and Sandra bought a Lely Hibiscus 805 rake. They looked at a model with adjustable width through two

Ron and Sandra Carey

hydraulic rams but they decided that an older model suited them better, because they always leave it on the maximum width anyway.

“The Hibiscus is built like the brick proverbial.

It has lots of cam settings but we don’t change them either. Mike Walsh, a representative from Lely’s head branch in Hamilton, came down with the rake.

He set it up for us, and we haven’t altered it since. He spent half a day showing

how to work it.”

Sandra rakes with her 180hp tractor but Carey says 80hp or 90hp would be enough.

The rake has made it much easier to form a bale.

“It makes me look really good when I’m baling.

Some of it is Sandra, as she knows how to rake a paddock, and some is the rake. It lifts up and folds in the outside of the row, so when you’re baling you’re not zigzagging down the row. There’s more grass on the outside of the row and

it makes nice square sides on the bale.”

The Careys’ baler is a Lely too – a 2009 Welger RP435 variable round baler. For hay, Ron makes up to 15 bale equivalents and around 10 for silage. It has optional knives, and a drop floor for blockages.

“The day I got it was the first time for ages I’d come home with a smile on my face. You just don’t have to get out of the tractor. If it blocks you just drop the floor, the blockage sucks through, raise

the floor and you’re away again.”

The RP435 does not get blocked often. “I saw a demo before I bought one.

It was a drizzly day with wet-as grass that had just been cut. The baler was fair flying around. Someone made a heap of grass just to block it. You could hear the baler working but it kept going. It just went straight through it.”

Carey likes the fact that the RP435 is stable on hills.

“I feel safe on the side of hills even with a full bale.”

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Dairy News october 15, 2013

hay and silage // 51

Grass silage – the preservation process SILAGE IS pickled pas-

ture. When pasture is ensiled, its sugars are converted into lactic acid by bacteria. It is the lactic acid which pickles the pasture, allowing it to be preserved for a lot longer than if left in the open air.

For good silage preservation, we need a rapid drop in pH to a level where there will be no butyric fermentation, so the silage is stable until it is needed.

The following describes the preservation process which makes pasture into silage.

Aerobic respiration The first phase takes place while pasture is wilting in the field, and while there is oxygen in the stack. Plant enzymes, and bacteria, use the oxygen to turn sugars and proteins into energy. This produces heat, an increase in numbers of bacteria, and a loss of nutrients from the pasture.

Sugars and proteins are lost from the silage when left too long in the field or not covered in the stack. They are not available for cows to eat later on, and the loss of sugars can have a big bearing on how well the silage preserves.

Compaction and quick covering of the silage to remove oxygen is a key to minimising respiration losses. A US trial showed that immediate sealing of a silage stack saw all oxygen used up after 5 hours. A similar stack left unsealed for 48 hours took 90 hours before all oxygen was used. The potential respiration losses are huge.

Lactic fermentation Once all the oxygen has been used up, anaerobic

lactic bacteria (which only function when there is no oxygen around) begin to multiply in numbers.

As they do so, they turn sugars into lactic acid, which results in a drop in silage pH. A low pH preserves the silage, by preventing butyric fermentation.

If butyric fermentation is prevented, the pH will stay low. The silage will be stable and well preserved.

The pH needed for stable silage changes with DM% (water content) of the pasture.

■■ Very low DM pasture (<15%) is unlikely to reach a pH low enough to become stable.

■■ As DM% increases, the pH needed for silage to become stable also increases. For 25- 35% DM pasture, a stable pH is 4.3 – 4.6 , but for 35-45% DM pasture a stable pH will be 4.6 – 5.0.

Butyric fermentation If the pH is not low enough for the silage to become stable, then butyric fermentation will occur.

Butyric fermentation results in the breakdown of nutrients in the silage, and a drop in the palatability of the silage for cows.

Butyric fermentation is caused by other anaerobic bacteria (Clostridia), which live in higher pH conditions than the lactic acid bacteria.

They turn lactic acid into acetic and butyric acid, to get energy. They also get energy by breaking down protein into ammonia.

The reduction in lactic acid and increase in ammonia during butyric

fermentation causes the pH of the silage to rise again. This makes the stack more suited to further butyric fermentation.

The only way to prevent butyric fermentation is to avoid soil being harvested with your crop.

When pasture is ensiled, its sugars are converted into lactic acid by bacteria.

Wilt pasture to about 30% DM which is also important to prevent seepage and have a silage pH which is low enough to stop Clostridia functioning.

• Article sourced from DairyNZ

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Dairy News october 15, 2013

52 // hay and silage

Silage test tells you which mouths to feed KNOWING THE qual-

ity of your silage is important because it tells you whether to feed the silage to milking or dry cows, says DairyNZ. Analysis will allow

you to value silage on its metabolisable energy (ME) content, as well as on dry matter (DM).

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says DNZ. “The quality of the pasture when it is harvested will tell you what the potential for your silage is.

“Collect pasture from either cut swaths in the paddock, or as it arrives onto the stack. Try to get samples from all the paddocks being harvested.”

Silage sampled from unopened stacks or bales will tell you the quality of the feed before it is fed out. It will also not have been spoiled through exposure to the air.

A sharpened length

of stainless steel pipe can be driven into the top of the stack, or the side of the bale. A piece of 25mm milk line, 1.5 m long, is sufficient. Use a broom handle to force the silage out of the pipe. Throw away the silage from the surface of the stack or bale before taking a sub-sample to send away for analysis.

Reseal the cover. Coring a stack or bale lets air in, and will result in some spoilage. Bales which have been cored should ideally be fed out within three days of sampling.

Sampling silage as it is being fed out This tells you the quality of the silage you are feeding out, without running the risk of causing spoilage in the unopened stack or bale. For silage being fed out in a wagon, collect a sample from the silage at the top of a freshly loaded wagon and for bales of silage, take a sample from the freshly unwrapped bales. Avoid silage from the surface of the stack or bale, and silage from the face of the stack.

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SILAGE ANALYSIS is carried out in two ways. Some laboratories use wet chemistry – well established chemical methods to work out the composition of feeds.

NIR is a more indirect way to estimate the composition of a feed. It involves a machine which sends a beam of light through a sample of feed, and measures the light pattern which is produced out the other side of it.

By calibrating the machine with known samples of feed, it can estimate the composition of unknown samples.

All labs calculate the ME content of feeds, based on their composition.

ME is a very expensive and difficult thing to measure directly.

NIR measurements will not be more accurate than wet chemistry.

However, it is faster, and may be less expensive.

The way you sample your silage is potentially a bigger source of error than the lab you use to analyse it.

Silage will never be of higher quality than the pasture it is made from.

Packaging and storage of silage samples Silage starts to decay once exposed to the air.

This decay process must be minimised while the sample is in transit to the lab, to get meaningful results from analysis.

• Put the silage into an airtight plastic bag, and remove all the air.

• If you can’t post the sample immediately, store it in a freezer.

• Post the silage in a plastic, self-sealing envelope, such as those avail-

able at Post Offices, or those supplied by a local testing lab.

• Send by Fast-post, but avoid posting on a Friday.

Where can I get silage analysed?

Silage analysis is available from a variety of commercial labs around New Zealand. There will be local labs which can provide a suitable service.

Talk to your local consulting officer, consultant, fertiliser rep or vet about the best lab for you to use.

The important things to have analysed is the feed value of the silage.

You will need dry matter %, crude protein %, DM digestibility, and an estimate of the ME concentration in the silage.

You will need pH and ammonia-N (% of total N). The amounts of lactic acid and butyric acid in the silage are useful as extra information, but certainly not vital.

Check out our websites

www.ruralnews.co.nz www.dairynews.co.nz Follow-up coming on www.dairynews.co.nz

Dairy News october 15, 2013

machinery & products // 53

Grain feeder saves time gareth gillatt

into bins but observed a lot of waste due to the weather and animal fouling.

Bin feeding was time consuming, says von Ah, as they had to refill bins by bucket at least three times

ADVANTAGE GRAIN feeders can reduce the time and feed that need to be put into calf replacements, says Hokitika dairy farmer Rosslyn von Ah. Werner and Rosslyn von Ah milk 400 cows on 180ha at Hokitika. von Ah rears 80-100 replacement calves each year on barley, straw and soy meal they blend on farm.

Weather during calving is largely responsible for the staggered introduction to grass and von Ah says they began using their own blend largely to get more use out of a Keenan mixer wagon they bought four years ago, to save money on calf feed and Advantage grain feeders minimise time gain better control over their and feed wastage . calves’ feed.

“The calves do really well on a day to ensure calves always had it and it costs $100-$200 less per meal to eat.

That changed two seasons ago tonne when compared to boughtwhen von Ah replaced troughs in meal.”

The von Ah’s initially fed out with two 800L NGF800 Advan-

tage Feeders grain feeders.

Not only did grain feeders stop food from spoiling, they also allowed the farmers to load feed for several days, reducing the time needed to feed calves.

“They don’t eat much at the moment because they’re still drinking milk so it lasts quite a while but when they get weaned they tend to go through a half tonne bag every

two-three days.

“We just get a half tonne bag on the front-loader, open it at the bottom and bang on the sides of the bag to get the feed into the grain feeder.”

Getting the mixed grain into the feeder can be difficult because of straw in the feed, and the straw also tends to clog up the feeder. “Pulling the straw down though the grain hole only takes a minute and its better than buggering around with buckets.”

Von Ah has removed the adjuster guards, which ensures all stock get equal portions of food. “If you used pellets these things would be great.”

They move the feeder around with the frontloader and von Ah says the feeder has stood up well to the elements although it does stay in the shed during winter.

Tel. 09 431 7276 www.advantagefeeders.co.nz

Trusted backup generators A NEW range of European generators, branded Doosan Infracore (formerly Ingersoll Rand) is now marketed by AB Equipment.

This company has made generators for at least 125 years.

The new range has models 20-500kVA, plus a cheaper series (Doosan Eco) of stand-by generators that should suit farmers needing less frequent use.

The generators suit continuous use in harsh environments. Double-wall liquid containment gear prevents leaking of fuel, oil or coolant.

Steel enclosures protect against the weather and minimise accidental damage. All panels are coated with a 13-stage paint process. Uniquely designed airintakes keep out dirt and debris.

A standard heavy-duty skid base with forklift slots ensures easy mobility.

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Dairy News october 15, 2013

54 // machinery & products

Not so pretty, but tough MARK MACFARLANE

WHAT TO do when you’re loaned the

Toyota Land Cruiser 70 to review?

Head for the hills! Only off-road and in challenging landscapes does this vehicle begin to make sense.

Lofty, pliable suspension, basic but easy-to-clean interior and a snorkel intake outside the driver’s window signal this is a work truck, not a school run-faker. Indeed that is the essence of this truck: it isn’t a townies’ vehicle for off-road, more an off-road vehicle for driving to town.

Pretty it is not. Planning a trip overland through Australia or Africa? Perfect, it won’t break a sweat and is likely to be going decades later as previous models have shown.

The heart of the beast is a great engine: a V8 of 4.5L, and though maximum power is only 151kW it is the torque-rated at 430nM that will haul you from trouble. A flat torque curve

from only 1200rpm makes hard work seem effortless.

The Land Cruiser is still fairly quiet and only pushing up the rev range – a bit pointless given the pulling power at your foot – will make the cabin noisy.

Inside the creature comforts are few: a reasonable stereo with Bluetooth and air con of course, but don’t go looking for entertainment screens, reverse cameras, cruise control or even electric mirrors. These are big protected units you get out to manhandle for adjustment.

An unexpected bonus is the seating: it doesn’t look especially sculptured, but it’s very comfortable. Even on a long trip, you won’t be squirming for circulation in the legs.

Dairy News tested the double-cab chassis with a nicely made Toyota deck

0%

David McMillin with the first stock of MineralBoost being shipped to the South Island.

Mineral booster heading to southern market Toyota Land Cruiser

on the back. Carrying capacity is solid and it has a tow capacity of 3500kg braked. It makes for a long parking space requirement at 5.230m long and with a turning circle of 14.4m you won’t be racing off to the mall in a hurry, but this all makes sense when you go offroad.

Prices for the Toyota Land Cruiser start at $69,680 and top $83,580 before extras. That’s somewhere to start. The usual warranty is three years, though five year options are available.

Tel. 0800 TOYOTA

FEED SUPPLEMENT maker Fertco will launch its MineralBoost G2 products in the South Island this month.

Chief executive Warwick Voyce says North Island sales have grown this year and the company is ready to head south.

Developed and made in New Zealand, MineralBoost is intended to “balance the mineral deficiencies of supplementary feeds such as palm kernel, grains, silage or blended rations,” Fertco says.

The product contains New Zealand sourced lime and salt and Australian magnesium.

The range includes MineralBoost

G2 + Rumensin and MineralBoost G2 Max which includes Rumensin and Bioplex High-Five organic trace minerals.

They are made using a patented granulation process that results in a rumen dispersible granule (RDG), the firm says. This enables more accurate mineral blending, less segregation of feed rations and less dust.

The RDG technology is said to ensure that the minerals, once in the rumen, are available to the animal quickly.

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Dairy News october 15, 2013

machinery & products // 55

Firm eyes vast South American market DUNCAN AG, Timaru, is moving into South America, planning to start exporting its Renovator MK4 drills to Uruguay by year end.

The company two years ago sent its first drill to Uruguay where it has been piloted to sow 500ha of pasture grass varieties and inter-sow into native grasses on 125 mm row spacing.

Cropping and grazing based animal systems are well advanced in Uruguay, but the country has some 10 million ha of largely untapped native grasslands that could be converted to mixed cropping and pasture or developed with legumes and grasses.

Craig McIsaac, general manager of Duncan Ag, says the opportunity to export to Uruguay came about largely through the relationship with a team of young pasture specialists and agronomists on the ground in South America.

“This group has close links with PGG Wrightson Seeds South America, the dominant player in the temperate forage market with an estimated 60% market share under the Wrightson Pas and Agrosan brands.”

Marcel Labandera, PGG Wrightson research and product development specialist in South America, is impressed with the drill’s versatility. “It’s capable of sowing directly

into pasture and also under-sowing where the crop has been harvested, with ease of regulation and calibration, durability and low need for maintenance.”

McIsaac says the Uruguayan results reinforced the durability of the Duncan Ag machines and adaptability to varying soil and topographic conditions.

“It’s also the only drill in the market that enables such narrow row spacing so important for pasture establishment, density and persistency.”

Craig McIsaac (left) and Marcel Labandera.

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MOWERS AND toppers are completely different machines designed to do different jobs, says manufacturer Maxam.

It says toppers are excellent in light cutting and flat ground hence commonly used on sports fields and recreation grounds.

“Use them on normal farming conditions however, and they quickly show their limitations,” it says.

“Heavier cutting is out of the question, as the volume of grass tends to block them up. They also struggle to cut low enough without scalping the ground. Fitting a rear roller helps with the ground following but further reduces the ability to clear the cut grass. Consequently, farmers turn to other mowers to handle the topping chores.”

It says disc mowers are capable and frequently used for topping, however there some downsides to this practice.

“They do require more skill to set up correctly and operate, and are not as robust when topping in rougher conditions. Not ideal for staff who struggle with complex farm machinery.”

The mower that is designed especially for fast, safe, and easy everyday mowing and topping is the Maxam mower, it says.

“These mowers can mow all crops including silage and hay and are the ultimate toppers as well.

As simple to set up and use as a topper, yet able to mow low without scalping thanks to the long skids underneath the cutting drums.

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Dairy News october 15, 2013

56 // machinery & products

Herbicide’s twin salt action NUFARM IS promoting a new WeedMaster product line of “innovative glyphosate herbicides” in good time for spring spraying and paddock preparation.

The company, said to be a world leader in glyphosate herbicide, says it has a demonstrated performance record of consistency and quality in New Zealand.

Leading the new glyphosate line is the premium strength WeedMaster TS540, a patented formulation that con-

tains 540 g/L glyphosate with Nufarm’s unique Twin Salt technology. By combining potassium and isopropylamine salts and adding a specific, blended in-can surfactant package, WeedMaster TS540 provides fast uptake, superior efficiency and consistent results in the field, the company says.

Known as Activate, the surfactant present in WeedMaster TS540 accelerates the plant’s absorption of herbicide through the waxy cuticle on the outside of the plant leaf, which means

a lethal dose is delivered to the stem and root system before the plant’s natural defences can kick in. The result is a complete kill of targeted species, with a rapid brownout even under the most demanding growing conditions, it says.

“Spraying in spring weather can present some challenges. Unpredictable weather patterns can make weeds very difficult to kill.

“However, WeedMaster TS540 can be tank mixed with Pulse penetrant to deliver commercially acceptable weed

control even if rain falls just 20 minutes after application. Additionally, the solution remains active up to five days after mixing in the tank, which allows for more flexibility and less wastage. “ Other features include low temperature storage ability, less time filling and mixing tanks, easy pour, low foam characteristics and less product and packaging to transport, store and dispose of.

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DEALERS NATIONWIDE

sedan and wagon models to meet the market.

A 2.5X sedan has been added to complement the 3.6X sedan introduced 12 months ago with its 50mm increased ride height to 200mm.

“The market segment shows no deviation from the overall move to crossovers and SUVs,” says Wallis Dumper, managing director of Subaru of New Zealand.

“Even some of our loyal Legacy customers are swapping to Outbacks which is logical given a Legacy is really an SUV capable road car…. Legacy customers now also consider Forester and XV models.”

The firm says the Legacy is now better value for money and more price competitive in the medium sized non-SUV market segment.

All Legacy models come with symmetrical AWD and a Subaru Lineartronic (SLT) automatic gearbox with the option of six manually selected gears using steering column paddle shifters on the 2.5L model and 5-stage transmission on the Legacy 3.6 X and GT models.

Dumper says some NZ customers still don’t want an SUV style vehicle, and its crossovers cater for that compromise. “But the Legacy continues… with more conventional ‘car’ or ‘wagon’ styling but all the invisible advantages of a boxer engine and symmetrical AWD.” The 2.5L models have 123kW boxer 4-cy engines with 229 Nm of torque.

Safety features include seven airbags, vehicle dynamics control, anti-locking braking with electronic brake distribution and brake assist, ring shaped reinforced body structure with anti-intrusion beams in the doors, anti-whip lash front seats and rear reversing camera.

There are alloy wheels, front fog lights, headlights auto off and an engine immobiliser security system combined with the remote control central locking.

The GT models come with a 195kW turbocharged engine producing 350 Nm and run on 18 inch alloy wheels.

Says Dumper, “The Legacy GT still [grabs] Kiwi buyers who don’t want the ‘mysteries’ of European ownership…. Business people in particular can keep capital in the operation while driving a vehicle they are proud of.”

Prices start at $44,990 for the 2.5i Sport, and up to $59,990 for the GT versions.

Dairy News october 15, 2013

machinery & products // 57

Mixer wagon helps grazier, clients SOUTHLAND DAIRY

grazier Greg Drummond, of 5 Rivers, northern Southland, has developed a client-cow feeding strategy that “could change the whole wintering playing field,” says Webbline, whose BvL mixer wagon the farmer is using.

Drummond says his technique can prevent two problems he has seen persisting in the region: cows losing condition during winter, and deep rutting in crop paddocks that can take countless hours to work back down.

He has wintered 2300 cows on his 5 Rivers property, feeding fodder beet, silage, hay and barley straw.

“Traditionally, we would put balage and straw in feeders in the crop paddock like everyone else. But we have two problems: the bossy cows would gorge on the balage, while the rest were left with crop and straw; this created imbalanced diet for most cows.

“It’s almost impossible for each cow to eat the right ratio of crop, balage and straw.

“Also, we would put huge ruts in the paddock taking countless bales to the feeders, which then fill with water and take forever to dry out in the spring. We are now working those paddocks up and it’s a breeze compared to other years.”

Drummond says using Greg Drummond with his BvL V-Mix 20.

a BvL mixer wagon has proved a great success.

“We mix one bale of hay, two bales of straw and 700kg of bulk silage. This mix is then unloaded onto the ground and reloaded back into our silage wagon which goes out into the paddock and feeds out while another load is mixed.

“We drive down the crop rows and feed out under the wire, which allows us to keep the tractor out of the mud, and all the cows get an even mix right along the break – each gets the same ratio, there is no selective feeding and I am getting excellent utilisation.

“All our paddocks are drilled using GPS technology, so each row is perfectly spaced, allowing us to drive over the crop without damaging the plants.”

Druumond says the BvL’s efficiency gets the mix ready in 15 minutes or less, “important to me as we are doing 17 loads a day.”

He says the dairy farmers he is grazing for are impressed with the condition of their cows.

Webbline sales manager Glen Malcolm says the company gets comments from clients every week, amazed at how fast and consistent the BvL mixers are. He says the machines require less power than many other brands of mixer.

The company is this season marketing Dairy Feeder, a web based programme to measure and track what is being fed to the cows. This is is owned

by BvL. It involves a measuring

Greg Drummond’s wintering operation with 2300 cows requires 17 loads a day through his BvL mixer wagon.

device fitted to the mixer which is linked to a Palm Pilot in the loader tractor via Bluetooth. This information is then fed back to the website giving farmers timely reports on the feeding process.

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Farmers are increasingly using our Mono HSE Dairy Effluent pumping range because they know they give considerable savings compared to centrifugal pump systems, while irrigating further at significantly less set-up and energy costs.

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Dairy News october 15, 2013

58 // machinery & products

CVT makes tractors ideal for experts NEW HOLLAND’S T6

tractor range now contains three models with Auto Command continuously variable transmissions.

The tractors are the 4-cyl T6.140, T6.150 and T6.160 models (up to 163hp, 676Nm torque) with engine power management (EPM). The first will arrive here next autumn.

Kyle Baxter, New Holland New Zealand operations manager, says “High

PTO power makes this range perfect for specialist row crop and vegetable operations and low soil compaction figures are ideal for professional spraying contractors.

[They have] smooth acceleration and deceleration for high-speed transport, and industry-leading ECOBlue SCR technology.”

The Auto Command transmission offers T6 tractor buyers a step up from the maker’s Electro

Command semi-powershift and Dual Command mechanical transmissions.

The T6 Auto Command is a further refinement of the T7 CVT transmission.

The T6 uses an identical forced-based operating logic and all key controls are grouped on the CommandGrip multi-function handle where the driver selects and fine tunes three target speeds, and activates the cruise mode.

The driver can precisely adjust speed in 0.01

km/h graduations, down to 20m/h at rated engine speed – said to be perfect for, say, hand planting. Top transport speed is 50km/h.

The Auto Command transmission is at its most efficient at the most frequently used operating speeds for cultivation and high speed transport, maximising the amount of mechanical drive. Available in a 50km/h Eco version, it allows the tractor to reach top speed at lower engine speeds (1750

New Holland T6 tractors with continuously variable transmissions arrive next year.

engine rpm), ideal for businesses doing a lot of road travel.

For safety when towing a trailer on a hill, the T6 Auto Command uses the maker’s Active Start Stop technology: when sta-

. . . c a v i r Va another winner !

“We had high SCC (somatic cell count) and needed to fix the problem.

tionary, the transmission securely holds the tractor.

The operator’s CommandGrip nestles under his right hand. The colour touch screen enables all parameters to be analysed and changed on the move.

The cab of a New Holland T6 tractor.

With Varivac, our situation has changed - so much so that we were recently delighted to win second prize in a major competition that our local dairy co-op ran for the quality of our milk.

To get a trophy for farm excellence and milk quality was just marvellous.”

‘Specialists in Dairy Automation Solutions’

www.corkillsystems.co.nz

For FREE advice & no-obligation quote, Phone Vern on 0274 460 165 or FREEPHONE 0800 10 7006 or email: info@corkillsystems.co.nz

CSL003

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