Dairy News 25 August 2015

Less milk raises hopes. PAGE 4 GDT CHANGES

LIGHT BUT TOUGH

Sharemilkers go orange PAGE 38

Better mix of products PAGE 8-9

AUGUST 25, 2015 ISSUE 341 // www.dairynews.co.nz

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Less milk raises hopes. PAGE 4 GDT CHANGES

LIGHT BUT TOUGH

Sharemilkers go orange PAGE 38

Better mix of products PAGE 8-9

AUGUST 25, 2015 ISSUE 341 // www.dairynews.co.nz

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DAIRY NEWS AUGUST 25, 2015

NEWS // 3

Asset rich, cash poor PETER BURKE peterb@ruralnews.co.nz

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A FORMER head of state-owned farmer, Landcorp, says the only way the government can extract more money from the company is to sell some farms.

Chris Kelly was commenting on a parliamentary debate about Landcorp’s financial state in the dairy downturn and comparisons between it and another state owned enterprise (SOE), Solid Energy, which is in voluntary administration.

Both Finance Minister Bill English and SOE Minister, Todd McClay have publicly suggested that Landcorp sell farms to reduce its exposure to debt.

McClay says he has held discussions with the Landcorp board for seven months but any decision on farm sales is up to the board. However the Government acknowledges Landcorp is in a strong financial position with a debt to equity ratio of just 15% as opposed to the 41% of Solid Energy.

The problem for McClay and English, it would seem, is the dividend likely to be paid to government this year may be virtually nothing due to the dairy downturn. Like all farming enterprises the SOE has to cope with the vagaries of weather and international prices.

It is clear the government is nervous about the watertight deal requiring Landcorp to develop more dairy farms in the central North Island in partnership with a private company, Wairakei Pas-

Chris Kelly, former Landcorp chief executive.

toral. Under this arrangement Landcorp is paid by Wairakei Pastoral to convert mainly former forestry land to dairy farms. Landcorp then leases this land back from Wairakei Pastoral at a rental based on the productive capacity of the land at the time. It’s understood that as the land becomes more productive, the cost of leasing the land increases.

McClay says this arrangement will cost Landcorp “thousands of millions of dollars” and he’s worried about its ability to service this debt.

Kelly says the decision to go with the Wairakei Pastoral deal was to reduce the SOE’s exposure to the sheep and beef sector. He says at one stage 80% of Landcorp’s farms were sheep and beef and now it’s about a 50/50 split with dairy. He says that move

was a strategic decision at the time.

“The problem for the government is that in the past 18 years the capital value of Landcorp has risen from $450million to the present $1.7billion.

The only way the government can get their hands on that money is if they sell the company or part of it because it is all capital gain.

“So while the portfolio is worth more, in terms of cash to the government by way of dividend it’s a poor dividend yielding company as are all farming companies. It’s no different to anyone else,” he says.

Kelly says it’s grossly unfair to compare Solid Energy and Landcorp because their capital structure is completely different.

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LANDCORP CHIEF executive Steven Carden says the company runs a conservative balance sheet, with low levels of debt relative to its assets.

He says it works hard to remove risk from its business, as evidenced by their full support of Fonterra’s guaranteed milk price (GMP) over the last three years, plus their work to build high value contracts in the wool and meat businesses.

Carden says Landcorp also runs a diversified business with income coming from

dairy, red meat, wool and forestry, further reducing risk.

“Landcorp has moderately increased its debt over the last few years to fund some dairy conversions in the central plateau and Canterbury. These developments are based on long-term views of dairy payouts.

Future plans at Wairakei Estate remain under review as we determine the optimal economic and environmental use of that land. It is a long term lease (40 years) and we are not looking to revoke it,” he says.

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DAIRY NEWS AUGUST 25, 2015

4 // NEWS

Less milk ‘wakes up market’ PAM TIPA pamelat@ruralnews.co.nz

KEY SIGNS of lowering production were enough to “wake the market up” out of its downward spiral at last week’s GlobalDairyTrade auction, says ASB rural economist Nathan Penny.

“We see evidence of them being awake now and getting prices higher as a result,” he says. But he says there will need to be more evidence of slowing production for better prices to really kick in.

Hopefully last week’s auction will be the first “leg up” and a rebound in confidence is likely in the next auction or two, he says. The overall price index was up 14.8% with

whole milk powder up 19.1% to an average price of US$1856/MT. “In July and August everyone was pretty downbeat, prices got ridiculously low really. They were away from reality of where farmers or producers could produce profitably,” he says.

“The first step is getting confidence back in the markets. The second step is to actually have to see some materially slower growth in production, or if not, some actual falls in production. That would then allow prices to kick up over the next 12 months.”

The “circuit breaker” this auction was the markets starting to think about production being lower this season with El

Nino on the radar, more and more commentators talking about production falling with farmers culling heavily, and farmers under pressure with cashflows looking to rein in costs and that flowing through into lower production this season.

Fonterra’s move of lowering auction volumes for the next 12 months was also a factor.

The ASB is holding its milk price forecast at $4.50/kgMS for the season.

ANZ rural economist, Con Williams, says we have seen the bottom.

“But in terms of further improvements from here we would need to see the fundamentals continue to shift in some of the centres of direction in which they have started to flow,”

he says.

“A key to that is lower New Zealand production as well as an improvement in demand particularly out of China.

“Constrained supply through GDT has helped, as well as Fonterra changing it product mix away from whole milk powder and the lower supply out of New Zealand. Obviously we are only just calving at the moment, it is very early in the season, we need to see how that plays out.

“We need to see those fundamentals continue to increase in the right direction for price improvement to be sustained.”

Williams says in January/February we saw a rally in prices but the fundamentals underlying that

hadn’t changed and prices came down quickly.

“So I guess there is a danger that dairy prices do that again if those fundamentals don’t seem to have moved in the right direction. Things could be a little bit bumpy at the moment depending on how things resolve.”

ANZ’s farmgate milk price forecast is $3.75 to $4/kgMS. The bank dropped it to the mid threes at the previous auctions to show where things had got to but they have now taken out that downside risk.

Rabobank research analyst Emma Higgins says buyers at last week’s event were rushing out to capture the lowest prices ever seen on GDT and that was exacerbated by

Sector lacking strategic direction

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the significant reduction in offer volumes.

“But the world is still awash in milk and prices are still likely to remain at lower levels until inventories are worked through and global production slows down,” Higgins Nathan Penny, ASB. says.

She says the build significantly increase last event was “absolutely in mid-2016. positive and great news” “We expect further but “we still have a trough strength over the next to get through and the road is still a little bit long couple of auctions, before dairy prices start the long to full recovery”. grind higher over the They expect a slow remainder of the season climb. The market will remain weak until the end (i.e. next 12 months),” the bank says. of 2015 and prices start to

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LABOUR SPOKESMAN on primary industries, Damien O’Connor says while the dairy developments at Taupo are impressive it’s important the Crown is not exposed to major debt such as that of Solid Energy.

However O’Connor says he’s impressed with Landcorp’s focus on low cost production systems.

He says the dairy industry in general at present is lacking an overall strategic direction and individuals are making potentially risky decisions.

“There are some players in the industry who are intensifying their systems while others are more cautions and probably winding back their production,” he says.

“That leads to the question of processing capacity in terms of the wider industry and I don’t think anyone would want to see the dairy end up with a meat industry situation where we have excess capacity.”

He notes a number of foreign investors are becoming involved in the dairy processing industry to vertically integrate their systems.

There is real risk of over-capacity becoming a reality in the dairy sector, he says. While some commentators are encouraging farmers to increase production, farmers who don’t focus on profit will go broke and additional production alone doesn’t develop a better outcome.

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DAIRY NEWS AUGUST 25, 2015

NEWS // 5

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SMART PASTURE manage-

ment can give the average dairy farmer an extra $40,000 of feed, according DairyNZ’s team leader for productivity, Rob Brazendale.

He says it’s realistic for farmers to harvest an extra 1tDM/ha between now and Christmas, possibly worth $300-400/ha, which translates to the $40,000 saving.

Brazendale runs DairyNZ’s feed review visit campaign whereby dairy farmers register for a DairyNZ representative to visit their farm to review their feed situation. At least 700 farmers have now asked for this, the focus being on how they will manage their feed from calving to balance date. The visit lasts 90 minutes, yielding a second opinion on the farmer’s feed situation to help reduce costs.

“We started in Northland in late July, have gone through the North Island and we’re now starting in the South Island. We have visited 400

DairyNZ’s Rob Brazendale is calling farmers to manage pasture better in the current downturn.

farms and made appointments with the rest.

“We come up with three assessments. First, they are doing fine and should stay with their plan. Second, they are a little bit off the mark and their system needs tweaking such as a reduction in the feed allowance to cows or reducing supplements.

Third, they are really off track and we recommend they get someone in to help them do a full assessment and prepare a feed management plan for them, ie a referral to

a farm consultant.”

Brazendale says the farmers way off track number 5-10%. Most need some small tweaks and 30% are spot on.

The weather’s part has caused significant regional variances, he says. Northland has had a benign winter and farmers there are comfortable. Waikato is tight for feed with frosts not helping; Manawatu is suffering a very cold, wet winter.

Farmers there probably have less feed than they realise.

“If we look at the rainfall stats for that region from April through to now we have had very high rainfall -- 240ml for April, 180ml for May, 280ml for June and about average for July. In August we have already reached the monthly average. The temperatures have been low as well so pugging is a problem and it’s very hard to get good utilisation of pasture in wet conditions. Consequently that means most farmers are shifting stock earlier than they would like and therefore getting through more feed than they would like. Not only are we not growing as much as we’d like, we are probably wasting more than we would like as well,” he says.

Brazendale says while it’s been wet in Taranaki, farmers there can cope because the soils are a bit more forgiving.

The take-home message to farmers is to grow the extra dry matter and use nitrogen providing conditions are right for this.

“It is definitely the cheapest form of feed and one we’d recommend,” he says.

Payout challenge is to tune up DAIRYNZ’S GENERAL manager of extension, Andrew Reid, says dairy farmers are looking closely at their feeding systems in the light of the low payout.

The payout has come as a shock to a lot people and farmers are now challenging their own farming systems, he says.

Anecdotally they don’t appear

to be changing from one system to another, but rather are looking at refining and cutting costs in their existing systems.

“People are destocking or making sure they are not carrying passenger cows through this current season.

“They are making best use of home grown feed instead of buying

supplements. And they are looking at all farm inputs.”

Reid says many farmers have been through tough times before and they are now hunkering down to ride out the storm of low prices.

Many farmers got rid of passenger cows in the late spring in anticipation of a tight season, reducing reliance on supplementary feed.

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The prospect of El Nino raises issues for farmers, he says. Southland farmers are already talking about growing fodder beet to take them through next winter.

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DAIRY NEWS AUGUST 25, 2015

6 // NEWS

Failure a last resort

Russia lifts ban RUSSIA HAS lifted restrictions on imports from 29 New Zealand dairy plants for some products such as anhydrous milk fat and whey and whey concentrates.

The temporary restrictions were lifted on August 17. The restrictions on New Zealand dairy plants relate back to Russia’s reaction to the whey protein concentrate issue in 2013.

“We’re continuing to work with the Russian authorities to lift the temporary restrictions on the remaining products produced at those 29 plants, and to ensure all other New Zealand plants wishing to export dairy products to Russia are able to do so,” MPI says.

PETER BURKE peterb@ruralnews.co.nz

IT’S NOT in anyone’s interest to see

customers fail, says Westpac’s head of agribusiness, Mark Steed.

Liquidation or receivership is a very last resort, he says, commenting on the downturn in the dairy industry.

Steed says Westpac representatives are talking with farmers and advisors including their accountants to help them re-budget and make sure the new budgets are transparent and realistic.

It’s obvious most farmers will have negative cashflows and these will range from more than $2 million for larger enterprises to about $300,000 for the average moderate to small scale operation.

“We and farmers are in this together; we have been increasing the level of contact with our customers,” he says.

They want to ensure the customer has got a viable cost operation. They look at budgets and making sure the assumptions are realistic for the ongoing viability and sustainability of that business.

“It’s about challenging the assumptions so for example if you have got a high cost model operation with supplements and fertiliser going in, it is not as easy as just turning the tap off.

This is about saying what can customers achieve with a lower cost model and how appropriate is that for them to be challenged on that. It is a bit of paradigm shift and we have to ask those questions.”

Steed says the key to sorting out the financial position of a farm is the willingness of farmers to engage in a positive dialogue with the bank and show a willingness to re-cut their business model with a view to future sustainability.

Those that won’t engage with the bank, other creditors and stakeholders will find they lose the support of these people and this could end up being a significant problem for them. Banks are well placed to deal with a downturn and have been planning for this.

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Rugby great Sir John Kirwan has been travelling the country as Westpac’s ambassador and talking about dealing with depression.

“For the last three to four months, we have been training and educating our staff to deal with these difficult situations and to be able to have difficult conversations with customers,” he says.

“Remember that many of our bankers are also farmers so it’s a bit of double edged issue whereby they are equally feeling the stress and the strain of dealing with the issues at home as well as having to go out and see their customers who are going through fairly torrid situations. So sitting around the table is a very stressful environment to deal with.”

Steed says Westpac’s ambassador, rugby great Sir John Kirwan, has been travelling the country talking about how to deal with depression. Up to 500 people have come at some venues.

For help visit www.depression.org.nz

HIGHLY GEARED AT RISK WESTPAC’S MARK Steed says the most at-risk farmers are those that are highly geared and were struggling even when the farmgate milk price was relatively high.

For some their business model was always unsustainable. But Westpac is putting in place plans to help all its farmer customers.

Steed believes the days of an $8/kgMS plus pay-out are gone, but the present pay-out of below $4/kgMS is equally an aberration.

The future normal pay-out will be somewhere between $5-6/ kgMS, he says.

“There has been a real focus in the dairy industry on increasing production on an annual basis which has been complemented by higher pay-out levels,” he says.

“Post GFC a number of businesses have had to adopt different kinds of cost models and look to how they going to cut their cloth according to their businesses. Dairy farms are no different and will have to take a microscopic view of every facet of their business.

“As a result they’ll have to consider what is the sustainable operating model.”

THE COMMUNITY group Project Tongariro, DOC and OSPRI have joined forces to kill pests in Tongariro National Park.

“We’re excited about joining forces with DOC and OSPRI as their pest [killing] work is critical to ensure we protect and enhance the Tongariro area,” says Paul Green, Project Tongariro president.

OSPRI group manager Matthew Hall says while OSPRI’s main goal is to control and ultimately eradicate bovine TB from the wildlife population, this shows a grassroots community group taking a handson role in pest management in their region.

“We believe we can achieve greater biodiversity gains and enhanced disease management objectives by working together more closely,” Hall says.

All three groups are working on Mount Pihanga, killing possums, stoats and rats. While the goals of each group differ, they are compatible and their work often overlaps. They are committed to coordinating their efforts wherever possible.

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DAIRY NEWS AUGUST 25, 2015

8 // NEWS

Fonterra to push sales option, p PAM TIPA pamelat@ruralnews.co.nz

FONTERRA IS being

“commercially rational” by reducing the volumes sold on the Global Dairy Trade (GDT) auction, says Fonterra managing director global ingredients, Kelvin Wickham.

“We have better options to sell milk as other products rather than basic whole milk powder (WMP). [The options include] cheese, protein, food service and consumer applications,” Wickham says.

“We have less milk coming in the next 12 months given the lower price. Therefore given the lower prices being discovered on GDT we are better to move the milk elsewhere.

“We will be moving it

to other products, other applications and we expect less milk because of the $3.85/kgMS payout.”

Basic WMP is a generic specification; higher applications such as differentiated milk powders give better returns. Cheese, protein and even skim milk powder and butter are also getting higher returns at present, he says.

Fonterra said earlier this month it forecasts reducing quantities it will offer on GDT by 10% for the next 12 months, including a shift away from WMP. About 30% of Fonterra’s product will be sold on GDT under that forecast, but Wickham says it could possibly go down further, to about 25%.

Wickham told Dairy News the reduction was announced because with such a significant volume

SUPPLY AND DEMAND IMBALANCE THE GLOBAL supply and demand imbalance is the biggest issue, says Kelvin Wickham.

“The milk is still coming in other parts of the world like Europe and the US and demand is still either sluggish in key importing regions or there is an inability to get into the likes of Russia,” he says.

“So we will adjust our sales portfolio. We will look for markets where we have better demand opportunities in different product as well.”

Supply will start to slow in Europe because the farmers are seeing lower prices as shown by the protests in the UK, France and Ireland.

“But still their bundled return in mainland Europe is much higher than the

Fonterra wanted to ensure transparency to all the buyers and markets. But

local prices because it has obviously got local consumer sales,” he says “It is unlikely milk will come down there until the end of their season – when the cows go back into their barns. Let’s see that start to decline hopefully in September or October.

“In the US the milk production is still up. They are down in California because of the dry, drought conditions but up in the rest of the country.

But fortunately a lot of the US product is being consumed domestically because of the better economic conditions.

But there is some surplus product available. It will take time to collect.

“On the demand side there is global growth

but most of our customer supply chains are relatively full.

“It will take some time to consume those inventories then things will improve from a New Zealand perspective in terms of demand and less competition.

That will take a number of months yet unfortunately.”

at the previous events the cooperative also withheld a significant volume, again

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DAIRY NEWS AUGUST 25, 2015

NEWS // 9

, product variety we are “very confident” it provides a good price discovery on the day.

He does not know whether other suppliers are reducing volumes, but he says Fonterra has always supported the platform and always provided product.

“A lot of the other sellers on GDT are seasonal or come and go accord-

ing to what they may have available,” he says. US company Land O’Lakes pulled out of GDT this month, and had not been offering any product for some months.

Fonterra will sell less milk powders on GDT in the coming months and divert more milk to food service products.

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just responding to market signals.

“Every two weeks we look at what volumes we forecast to sell, because it is a 12 month rolling forecast and we always make some minor adjustments here and there.”

Wickham says they are still “very comfortable and committed” to using GDT to discover the price and

DON’T BLAME GDT GLOBAL DAIRY Trade (GDT) is not the cause of the wider issues of dairy prices, says Kelvin Wickham, Fonterra managing director global ingredients.

“I know it’s got a lot of air time and maybe it’s convenient to blame GDT but all it does is put a flashlight on the market price on the day,” he says.

“You still have to sell the product, so if you don’t have GDT you still have to go out there in the market and sell… because you are not going to hold and build inventory for a perishable good.”

GDT is the way of discovering prices for New Zealand products.

“We will continue to support that so even in the next 12 months the current forecast has around 400,000t of WMP on the platform.

“About 30% of what Fonterra produces is forecast to be sold on GDT over the next 12 months. We would expect that percentage to decline over time because that is more than enough volume to discover a legitimate price and we will continue to put our milk into new applications -- the growth in food service, the growth in consumer and differentiated ingredients.”

While the forecast is still for 30% of product into GDT, Wickham thinks it will probably go below that and be more like 25%.

“We have other opportunities and still there is enough volume on there to discover the price.

“There is a much bigger market which happens outside of GDT.” Fonterra is always selling even when GDT isn’t on. GDT “flashlights” market levels for the world to see. But what they were seeing in prices in between GDT events wasn’t inconsistent with those prices.

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DAIRY NEWS AUGUST 25, 2015

10 // NEWS

Expect a spring on steroids PETER BURKE peterb@ruralnews.co.nz

METSERVICE IS

warning farmers to expect a cold spring or, as meteorologist Georgina Griffiths says, a spring on steroids.

She told Dairy News that September is likely to usher in more storms with winds from west sou’west and lower pressures over the country. MetService predicted a cold August and that has materialised.

The winter temperatures have been a shock; it’s been a long time since NZ has had such a cold winter, Griffiths says.

“The North Island had a cold July and a cold back half of June, and August so far is running normal cold for the North Island.

It’s been about five years since the temperatures looked like this in the North Island.

“In the South Island June was patchy and… bitterly cold, with snow

in late April, May and into the start of June. July was cold. We had a very high incidence of frosts in the North Island and in much of the South Island.”

She says rainfall has been mixed; parts of Canterbury have only just had their first good rain recently. Otago and Southland have been sopping wet, and Manawatu has had heavy rain. Northern regions have been relatively dry, though in some cases it’s been patchy. Overall it’s

been dry in the east and wet in western regions.

The El Nino pattern is driving the present conditions, she says. Sea temperatures in June were higher than they should have been. She expects sea temperatures in late winter to be about 1 deg lower on the eastern coastline and about 0.5 deg lower elsewhere.

This will result in the colder spring.

More storms and winds are forecast for spring.

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THE LOW payout may starting to affect farm sales in the dairy sector.

The Real Estate Institute of NZ Dairy Farm Price Index fell by 13% in the three months ending in July compared to the three months to June and 12.1% compared to the same period last year.

For the three months ended July 2015 the median sales price per hectare for dairy farms was $35,304 (41 properties) compared to $35,531 for the three months ended July 2015 (64 properties) and $36,673 (47 properties) for the three months ended July 2014.

“The recent Fonterra dairy payout announced confirmed widespread expectations within a market place anticipating a downturn in the current season,” says REINZ rural spokesman Brian Peacocke.

“The key issue for many is the time prices are likely to remain at current levels, with particularly concern being expressed for lower order and 50/50 sharemilkers.

“Banks generally appear to be supportive, but conversations are taking place given circumstances being appropriate. Across the board, culling of lower performing animals is evident, and the retention of surplus assets is under review.”

Recent trends seen include: ■■ Prices holding firm in the Waikato for those few dairy farms sold in July ■■ Early indications of some farmers in Northland initiating a change in land use from dairy to beef, purely in response to the economic situation.

Email: sales@eurotec.co.nz | Web: www.eurotec.co.nz

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How one idea fertilised an industry.

Every year, LIC’s bulls sire approximately three out of four of New Zealand’s AB calves.

That they can do this, is down to something known as Long Last® Liquid semen.

This unique development by LIC keeps the sperm viable for three

days so that it can get to over 8,000 herds around the country.

It also allows a much higher utilisation – with approximately one tenth the sperm dose of conventional frozen straws – while maintaining optimal conception rates.

It means every dairy farmer has access to the top LIC bulls and top LIC genetics, helping to improve their productivity and that of the national herd.

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DAIRY NEWS AUGUST 25, 2015

12 // NEWS

First milk through plant FONTERRA’S NEW

$235 million dryer at its Pahiatua site in Manawatu has processed its first milk.

The new highefficiency milk powder plant will soon be exporting whole milk powder to customers in more than 20 markets worldwide including South America, the Middle East and Southeast Asia.

New P3 plant staff celebrate the first bag off the line.

Fonterra managing director global operations Robert Spurway says the new dryer at Pahiatua is part of the cooperative’s strategy to drive greater efficiency and value in its product mix.

“This expansion is about more than just turning milk into powder,” says Spurway.

“The additional capacity it brings will help to relieve pressure

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on processing and give us more choices in the products we make during the peak of the season.

“This means we can be more agile in meeting product trends and changes in customer demand ­– turning more milk into products that will bring the greatest returns for our farmers.”

Spurway says the co-op has a strong track record of driving every cent out of the cost of production in these new highefficiency dryers.

“Dryers like this are already among the most efficient in the world by design. We’ve seen with similar dryers – like the one at our Darfield site – that with our systems, processes and people in place we’re able to reduce our cost of processing and increase our product yields even further.”

The new dryer, the third on-site, has the capacity to process an additional 2.4 million litres of milk each day.

The building that houses the new plant is also unique among New

Zealand dairy plants, and is the first to implement base isolation technology which would see it withstand a one in 2500 year earthquake.

Fonterra Pahiatua operations manager Bill Boakes says the new plant will also deliver on Fonterra’s commitment to environmental sustainability.

“The plant is the first in New Zealand to reuse its own condensate, significantly reducing the amount of water needed to process each litre of milk. On top of this, the new gas fired boiler has a number of systems for heat recovery that will drastically improve our energy efficiency.

“To ensure we’re able to meet our commitment to sustainable best practice, we’ve also added a new wastewater treatment plant to handle the additional volumes the site will generate.”

The new dryer is expected to be running at full capacity by early October. @dairy_news facebook.com/dairynews

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DAIRY NEWS AUGUST 25, 2015

14 // NEWS

Change rules on raw milk supply, collection – Fonterra PAM TIPA pamelat@ruralnews.co.nz

FONTERRA WANTS changes to regulations which force it to supply large processors with raw milk and which requires it to accept all milk from new suppliers.

Fonterra ends up being a fallback option for all would-be suppliers, it says in an executive summary of submissions to the Commerce Commission.

“They effectively have a free option to take risks with another processor, with the costs of this being carried by Fonterra and its farmer shareholders,” the cooperative’s submission says.

“It means Fonterra must live with additional uncertainty about the volume and location of future milk. Fonterra needs to build capacity for milk that may or may not arrive, and which may or may not stay with Fonterra longterm. This works against Fonterra being able to make the highest returning and most efficient investments in manufac-

turing capacity,” it says.

Fonterra is a cooperative, and is committed to processing all the milk produced by its farmer shareholders.

“But to help Fonterra and the industry invest and operate efficiently, Fonterra should have more discretion as to whether, and on what terms, it accepts milk from new suppliers.”

While the requirement to accept all milk was intended to incentivise Fonterra to price its shares and farmers’ milk efficiently and sustainably, today an efficient milk price and share price are achieved by the milk price regime, TAF and the presence of many well established competitors.

The Commerce Commission has invited views on the state of competition in New Zealand dairy markets and possible changes to the Dairy Industry Restructuring Act (DIRA).

In its submission Fonterra also says it should no longer be required to make milk available to large processors, except Goodman Fielder. Supplying Goodman Fielder remains important

Fonterra is forced by regulation to supply raw milk to independent processors, something the co-op is unhappy with.

for public confidence in downstream wholesale and retail markets.

Fonterra also recognises there is still a case for smaller, niche dairy processors having access to Fonterra milk, even though it is confident satisfactory commercial arrangements could

CO-OP FACES INCREASING COMPETITION INDEPENDENT DAIRY processors collected 22% of all milksolids in the South Island in the 2014-15 season.

As this is above 20%, it triggers the expiry of procompetition DIRA provisions – the requirement for Fonterra to supply independent processors with raw milk -- in the South Island no later than May 31, 2018.

However a Fonterra spokesman told Dairy News the trigger could possibly be preempted by any changes to the Dairy Industry Restructuring Act (DIRA), depending on what the

Government decides.

Any changes to legislation could take two years but would likely still come before the trigger date.

Primary Industries Minister Nathan Guy says under DIRA the minister is required to certify when the threshold is reached. The trigger will come into force on May 31, 2018, unless there is legislative change before then, he confirms.

“While Fonterra continues to collect more milk every season, it is encouraging to see new processors enter the market and

create competitive pressure,” says Guy. “Independent processors also collected 9% of all milksolids in the North Island. This indicates there is increasing competition in the NZ dairy industry.”

Guy says while the percentage of milksolids collected by independent processors is one indicator of competition, it is not definitive.

“For this reason the Commerce Commission has been tasked with providing a report on the state of competition in the NZ dairy industry.”

be agreed without the raw milk regulations.

“However, Fonterra firmly believes that it should no longer be obliged to make milk available to larger processors (other than Goodman Fielder), including those looking to establish a foothold in the NZ market,” it says. “Fonterra is now operating in a competitive environment in which competing processors have shown they have the scale and ability to secure their own milk supply (from farms or other processors).

“There are significant costs to Fonterra and its farmer shareholders as well as a real risk of creating inefficient and excess manufacturing capacity in the industry by continuing to provide this additional, regulatory support for large processors.”

In 2001 Fonterra’s share of the farmgate milk market was 96% with the remainder held by Westland and Tatua. Today there are numerous large dairy processors in NZ including Westland, Tatua, Open Country Dairy, Synlait, Miraka and Gardians (owned by Danone). Yashili and Purelands Dairies will start operating soon and others

such as He Run, are in the planning stages.

“The profile of these competitors has also changed. There is now a mixture of traditional NZ cooperatives, privately owned businesses, as well as large global companies vertically integrated into the NZ milk pool,” the submission says. Also since 2001 both Trading Among Farmers (TAF) and the milk price regime (including Commerce Commission oversight) have contributed additional market transparency and efficiency.

Fonterra still favours the milk price regime which it says continues to support market efficiency and notes it is only three years since the milk price manual was built into legislation.

Primary Industries Minister Nathan Guy says the Government will need to consider next year whether to promote changes to legislation to extend the duration of the pro-competition provisions.

The final Commerce Commission report is due on February 29, 2016 to the Ministers of Primary Industries and Commerce and Consumer Affairs.

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DAIRY NEWS AUGUST 25, 2015

16 // NEWS

Tackling the water consent conundrum CHRIS TIDEY

Chris Tidey, Ravensdown.

AS REGIONAL councils across New Zealand roll out their land and water plans, the farming sector

faces a whole raft of new challenges.

There are different definitions and timelines floating around depending on where you happen to farm, but one of these

looming new challenges is the issue of land use consent. Farmers have always faced discharge consents and ground water take consents.

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requirement for a land use consent is potentially huge. Behind all the jargon and “planning speak,” it can be easy to forget the fact that this consent is about the future of your farm over the next five to 25 years.

While its importance can’t be underestimated, the land use consent process and terminology can be daunting. When it comes to nutrient management, here are four ways to approach the consent conundrum.

1) Insist on a certified advisor Given the complexity of what is required when applying for a resource consent and the potential economic implications to your farming business, it is vitally important that the farm consultant undertaking this work is suitably qualified and experienced in farm systems and knows your business inside and out.

When it comes to your nutrient management advisor or environmental consultant, certification is a good indicator of the individual’s expertise. For example, Ravensdown environmental consultants are all certified under the Certified Nutrient Management Advisor scheme which was developed by the Fertiliser Association of New Zealand and DairyNZ. For complex and fast-changing resource management issues, a specialist law firm like Anderson Lloyd could hold many advantages over a traditional conveyancing lawyer.

2) Outsource advice but own the problem Whoever you choose to advise you, remember it’s only advice. What gets recommended and decided could determine your farm management practices potentially for decades. So it is extremely important that the landowner takes responsibility and is 100% comfortable with any potential changes in farm management before submitting the resource consent application.

3) The importance of a plan Most land use consent applications require a farm management plan. Depending on the region, this can be called a Farm Environment Plan, Nutrient Management Plan or a Farm Environmental Management Plan.

Whatever it is called, this document essentially outlines the management practices on the farm and aims to minimise the nutrient, sediment and microbial losses to surface water and groundwater.

The plan will also include the outputs of an Overseer nutrient budget and a plan as to how the applicant will comply with regional council regulations.

The document gives the landowner a chance to discuss any environmental achievements and other good management practices which may not be accounted for in an Overseer nutrient budget, such as extensive riparian planting or the creation of a functional wetland.

4) Look for low-hanging fruit You don’t always have to jump straight to large system changes that vary from traditional farming practices such as a reduction in stocking rate, large reductions in nitrogen fertiliser, the introduction of herd homes or earlier culling in the autumn.

While in some cases these may be viable options, for example, with dairy conversions on land where nutrients are already over-allocated, the most prudent approach is to start with ‘low-hanging fruit’. This commonly includes; removing mid-winter nitrogen applications, increasing the size of the effluent block, upgrading effluent systems, effluent storage, increasing water use efficiency through soil moisture monitoring, using low-protein supplementary feeds and wintering stock off-farm.

• Chris Tidey is environmental consultant at Ravensdown.

DAIRY NEWS AUGUST 25, 2015

NEWS // 17

Dairy downturn ‘truly awful’ but the end in sight THE LONG-TERM

dairy market remains strong despite the severe downturn affecting milk prices, says Rabobank.

It describes the drops in the GlobalDairyTrade auction prices in July and early August as “truly awful” for New Zealand dairy farmers, but adds that the collapse does not equate to long-term structural market change

in the sector.

In a new report released to its clients this month – Dairy Industry Note: Riding out the Storm – Rabobank says that while the dairy sector is experiencing a severe cyclical downturn the mechanisms that will turn the market around have now been triggered and a substantial improvement in prices is expected by

mid-2016.

Rabobank NZ chief executive Ben Russell says the bank’s firm view is the long-term fundamentals for the dairy sector have not been altered by anything seen in 2015 and there are strong reasons to expect the medium term holds plenty of upside for the NZ dairy industry.

“Contrary to some

BANK SUPPORT RABOBANK COUNTRY banking general manager Hayley Moynihan says that as an agri-banking specialist, Rabobank is well versed in dealing with the cycles of agriculture and is committed to supporting its dairy clients over the coming seasons.

“During the dairy market downturn in 2009-10, Rabobank was able to extend additional credit to its clients to get them through a difficult period so they could take advantage of the better years that followed.

“Rabobank also took on many new clients over those difficult years. This time our approach will be no different.

“We’re working closely with our dairy clients to minimise the size of any deficits and additional borrowings to ensure their businesses are as resilient and successful as they can be.

“Ultimately we take a longterm approach to banking rural businesses and we will stick by our clients through this difficult period.”

recent analysis and commentary on the NZ dairy sector, Rabobank’s view is the current price trough is part of an extended negative phase of the commodity cycle and not a structural, permanent change to supply and demand dynamics,” he says.

“While the season ahead will undoubtedly be difficult for dairy farmers, the bank is firmly of the view that prices will recover to more sustainable levels over the medium term. Current market conditions are not the ‘new normal’, but a highly abnormal part of a difficult cycle.”

NZ remains well placed to continue to play an important and overall profitable role in this improved future for the global dairy industry, the Rabobank report says.

“But first it must ride out the storm.”

Report co-author, Rabobank senior dairy

Ben Russell, Rabobank NZ chief executive.

analyst Michael Harvey, says the extent of the market collapse was, for most in the industry, “beyond expectation” and inevitably led to milk price forecasts for the 2015-16 season being slashed.

A 19% fall in prices over two GDT auctions in July and August took the market down from already painful levels to a low not seen since 2002 in FOB Oceania trade.

Given NZ production costs have increased significantly since 2002, you have to go even further back to find pricing this far below the cost of production, says Harvey.

The report notes that the global dairy market had already been well on its way to a correction in 2014 – from previous record-high prices – with

prices starting to fall to choke off a wave of milk supply and encourage demand growth.

“Unfortunately, this downturn was then exacerbated by several other developments, including China slashing its purchases from the international market, Russia banning dairy imports from the EU and some other suppliers, plus EU dairy quotas being removed in April this year,” says Harvey.

The Rabobank report says a combination of factors has conspired

to see NZ prices hit far harder by the downturn than those in other key dairy exporting regions.

“In this cycle, the pain has been asymmetrical, with NZ at the sharp end, and so far pretty alone,” Harvey says. “This has been for a combination of reasons, including a relatively strong NZ currency, our small domestic market and NZ dairy’s exposure to China and to whole milk powder, which are the worst-hit markets.” @dairy_news facebook.com/dairynews

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DAIRY NEWS AUGUST 25, 2015

18 // WORLD

Oz-China ties growing DAIRY AUSTRALIA

Australian milk powder packed for Chinese consumers.

chairman Geoff Akers says China is a growing and long term market for the Australian dairy industry.

Speaking at the recent at the annual China Dairy Industry Association (CDIA) conference in Beijing, he noted that the Australian dairy industry

has enjoyed a long and mutually beneficial relationship with the Chinese dairy industry.

This includes a range of programmes conducted in the market, including the scholarship and alumni program, by working closely together with China Dairy Industry Association (CDIA),

and the CDIA Annual Conference and Dairy Expo, and annual series of workshops and seminars in the market.

“We are committed to both the China market and the CDIA for the long term. With the signing of the China Australian FTA, we expect the long term relationship between

Don’t let them all go down

the two industries to be further enhanced not only in trade but also in investment.”

Akers said the strong demand for Australian products in China was continuing to grow as the Asian palate becomes more accustomed to dairy.

“We’ve learned that our Chinese customers like to have their options open for sourcing products and are keen to diversify where they source their products and ingredients to limit their exposure,” he said.

“Food safety, quality and consistency is more important and Australia is in a very good position to satisfy this.”

Aside from supplying cheese, milk and powders, Australia has also moved to focus more on supplying branded products for food service, bakery and retail sectors in China.

China is Australia’s fastest growing dairy export market, and is now the largest export market for Australia. In the past eight years (2007-2014), exports increased by more than 300% from 28,000 tonnes to 117,000 tonnes.

Value added and premium products such as cheese,

milk (mostly UHT) and powders make up the bulk of shipments.

During the conference, Australian Ambassador to China, Frances Adamson hosted a special reception to celebrate Dairy Australia’s Greater China Scholarship Programme, which has been running since 1999.

The programme, involving 240 participants, had been a key to developing and maintaining long term relationships with numerous companies and government officials.

“The programme has been an outstanding success in terms of the long term relationships we’ve established and we’re very proud of that,” Akers says.

“Many participants are now in senior positions in companies in China and have a very strong affinity with Australia having completed the programme.

“We are also very happy to see a number of new commercial business relationships emerging from the programme over the years.” @dairy_news facebook.com/dairynews

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DAIRYBASE IS a quick, easy and essential tool for farm businesses pushing for profit, says northern New South Wales dairy farmer David Binney.

Binney milks 350 cows on 100ha at Kyogle and says DairyBase enables farmers to quickly assess all the aspects of their businesses so they can start making decisions to help their bottom line.

“It took me 45 minutes to an hour to input all the information. All I needed was the yearly financials from the accountant and a 12 month summary from my processor and then you are provided instantly with the analysis on your farm.

“I have done other financial analysis programs before but what I liked about Dairybase was how easy it was to input the data and then get the analysis.”

Developed by Dairy Australia, DairyBase is a secure, web-based tool that enables dairy farmers to measure and compare their farm business. Farmers can sign-up atwww.dairybase.com.au.

After entering their farm data, farmers can then create confidential and comprehensive farm reports to help them understand the overall financial performance of their farm.

Binney says DairyBase calculates all the key performance indicators that are essential for decision making, such as around feedbase, labour and the herd.

“It very quickly captures that key information to give you areas that you need to focus on and you can then make changes if you wish to do so.”

DAIRY NEWS AUGUST 25, 2015

WORLD // 19

Farmers stamp their mark on products EUROPEAN DAIRY

giant Arla Foods is setting out this month to make it clear to its consumers that the company is owned by farmers.

New design elements on Arla products will promote the products as coming from a co-op delivering natural and nutritious milk. And it will push the farmer ownership message.

“We want to make it clear Arla is the farmers’ company,” says Arla chief executive Peder Tuborgh.

“This means all Arla’s earnings go back to its farmer owners and the owners are active in creating value for our consumers.”

Consumers are increasingly interested in the origin of products, says Åke Hantoft, chairman of Arla and one of the company’s 12,747 farmer owners.

They want to know how it’s produced, how the cows and environment

are treated and who they support when buying the product.

“Arla is the farmers.

It’s we, the farmer owners, who every day ensure the product is made with care.

However, many consumers don’t know this about Arla. We want to make this clear, because we are proud of our cooperative and the milk we provide.”

Money is tight for dairy farmers in Europe due to the low milk prices in the global market. Hence the co-op‘s message: “When you buy an Arla product you support dairy farmers, not a group of shareholders with little or no association to dairy farming,” says Hantoft. “Our main focus is to maintain a longterm sustainable milk supply, which is high quality and includes animal welfare.”

Arla farmers’ ownership of the co-op, and the earnings they get, give them a natural motiva-

Dairy Crest’s milk business could soon change hands.

tion to take care and invest in every step of the milk supply chain, the co-op says.

With the product pack messaging will come pro-

motion via social media, websites, events, etc.

Arla is owned by 12,747 farmer owners in the UK, Sweden, Denmark, Germany, the Netherlands,

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The $190 million sale inched closer last week after the Competition and Markets Authority said a major obstacle to the sale has nearly been overcome. It said proposals by Müller to help ensure the sector remains competitive postsale -- a major roadblock to completion -- were “appropriate to remedy” its competition concerns over the sale.

The regulator now “proposes to accept” Müller’s proposals, which paves the way for the deal to go ahead.

The sale would leave the UK market dominated by Müller Wiseman, Denmark’s Arla and the First Milk farmers’ cooperative.

Dairy Crest chief executive Mark Allensays it has always believed the sale of the dairies operations is good news for the whole UK dairy sector, now suffering low returns on dairy commodities.

“It will deliver economies of scale and cost efficiencies that will underpin investment and help the UK compete more successfully in global markets.”

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DAIRY NEWS AUGUST 25, 2015

20 // OPINION RUMINATING

EDITORIAL

Precious grass

MILKING IT...

One less thing to worry about

THE GOVERNMENT deserves a pat on the back for exempting dairy farmers from the proposed health and safety laws.

Farmers have been spared from having to appoint health and safety representatives. Under the rules workplaces must appoint a staff member to make sure bosses follow the rules. This will include all those with more than 25 employees, and workplaces with fewer than 25 employees that are deemed “high risk”- most farm-based workplaces have been excluded.

With challenging times facing the dairy industry, the last thing farmers needed was to worry about another business cost and more paperwork.

Fat and less fart

NEW FEEDS that make cows less flatulent are a discovery that could truly save the world.

The methane produced in the stomachs of ruminant animals including cows, sheep and deer is a powerful greenhouse gas.

In New Zealand, agriculture comprises nearly half of our rising gas emissions.

A global search is on to find ways to reduce the amount of methane produced by farm stock, and a Kiwi researcher is part of the team behind what may be the first solution.

Research co-authored

by Matthew Deighton, published in the Proceedings of the National Academy of Sciences journal recently, found a new stock feed additive, NOP, cuts the methane produced by cows by almost a third.

It interferes with an enzyme in the methane-producing micro-organisms in the cow’s stomach. “It’s a very, very small amount – as little as one gram – in the daily feed of a cow. So that means it really has the opportunity to get on to farms, as we don’t have to drastically change the diet of the animals.”

Clever cows

EVERYONE KNOW rats and mice can navigate mazes, but cows?

New research shows cows can be taught to follow sounds to find food in a maze. Some cows got a perfect score, when tested four times a day for four days straight.

And confirming that some cows are smarter than others, heifer number two nailed it immediately from day one of testing, amazing researchers when she found the food in less than 20 seconds.

The experiment, by Sydney University’s Future Dairy, was devised by 21-year-old undergraduate Alexandra Green to test dairy cows’ executive function and decision-making ability, and to see how they responded to sound.

Within a few days of training, the six heifers (cattle that are yet to have a calf) were taught to navigate a large T-shaped maze, which was built in a paddock. It resembled smaller mazes that are traditionally used to test rats and mice. Four cows scored 100%, while another two averaged 75%.

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Use our milk or else….

IGNORE OUR milk at your peril; that’s the message from UK farmers who are taking their protests against low prices to supermarket doors.

Tesco is the latest supermarket to be singled out by dairy farm protesters, who have switched their focus to cheap milk imported from the Continent and turned into butter, cheese and yoghurts; they claim less than half the butter and cheese eaten in Britain is made using milk from British farms.

Protesting farmers used tractors to blockade one of its biggest distribution centres in the UK; recent protests have concentrated on Asda, Morrisons, Aldi and Lidl, which had previously refused to raise milk prices.

THE DAIRY industry’s ongoing volatility coupled with a cold wet winter in many parts of the country has highlighted the real value of New Zealand’s pasture based system.

This has always been a hallmark of this country and our scientists and plant breeders have done a tremendous job developing new varieties of grass and management systems to get the maximum benefit from these.

But it could be argued that dairy farmers have been a bit complacent about their pastures as relatively comfortable payouts have led farmers down the track of so-called supplements.

DairyNZ’s one-on-one assessment of how farmers are managing their pastures shows only 30% have got it right and the rest are off track or terribly off track.

While some farmers can look at a paddock and accurately estimate how much feed they have, many can’t.

The dairy industry after this downturn will be very different and the difference between profitable and unprofitable farming will come down to a series of small gains in cost saving and production. Hard data will make that difference as successful farmers have shown for years.

But the pack has to catch up with the leaders and take advantage of technology in all its forms. There will need to a strong focus on profitability and less on boasting about production.

There may be fewer cows in the dairy industry but milk production may not drop. Look no further than the sheep industry which could frankly teach dairy farmers a thing or two about efficiency.

Professor Hamish Gow, Massey University, is right when he says the dairy industry has been living on borrowed time with its expectations and cost models. Saying goodbye to some of the euphoria around dairy will be good and hopefully a much stronger industry will emerge.

The best recent example is the kiwifruit industry. Vine-killing disease Psa was in some ways the best thing that happened to that sector because it got orchardists to look really hard at their businesses and be more hands-on and profit focused.

This downturn (not crisis) in the dairy may be a blessing in disguise.

The AB’s loss in Sydney was not a disaster, it was a motivation to do better and they did. That hopefully will win the World Cup.

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DAIRY NEWS AUGUST 25, 2015

OPINION // 21

Nothing like peering into effluent to inspire poetry EFFLUENT

Upon a Southland Bridge*

IRRIGATION expert

Stuart Reid, Spitfire Revolution, was recently called to Southland to attend to a bridge mixing propeller fouled by a rope.

Repairs were urgently needed because the pond level was as low as it would ever be, and what with milking (and the supply of effluent to the pond) just beginning, the window of opportunity was narrow.

Otherwise the job was a summer one.

Reid says he has no idea why, but he was inspired to put this episode into verse.

At a time when many farmers are struggling, this may lighten the mood out there: • Editor’s note: if you have a poem or snippet that would help lighten the mood onfarm, email it to editor@ ruralnews.co.nz

Stuart Reid

A callout to fix a bridge mixing propeller in Southland inspired Stuart Reid to write a poem.

There was dung and there was urine, there was odour, sludge and grot, but my call was to block my nose and service problems that arose and fix the bloody lot.

For McGinty though he cared for things, had gone and stuffed the prop, by wrapping it with rope so bad the mixing thing had stopped.

Well stuffed is a polite word when ‘effed’ would best be used, so I set to work in ice and snow that McGinty and his team could go and mix it as they should.

Now Southland has ‘big’ weather in the winter months my friends, and McGinty ’s call for help came at a grim time – comprehend?

When heavy snow and blackened ice pervade the country day and night, I had to go for the pond was low and the time to mend was ripe.

I toiled and swore and grunted with my mittens wet and cold, and my fingers didn’t work as well as in the days of old; but I ground along, ignored the pong and rarely raised my eyes to the black-as-soot horizon threatening all the whole day long.

And finally when I had settled all within my power, I headed back to my Balfour hutch to malinger in the shower.

The mixer wasn’t working yet but the task was mostly done; I could see an end to a rotten job looking toward the warming hob to getting home to my comfy mob and bathing in some sun. *With a nod to William Wordsworth.

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DAIRY NEWS AUGUST 25, 2015

22 // AGRIBUSINESS

Is the sugar daddy to blame?

PETER BURKE peterb@ruralnews.co.nz

THE RURAL sector will need a major

financial re-set as a result of the current low dairy prices, says the director of business, innovation and strategy at Massey University, Professor Hamish Gow. He told Dairy News that the present cost structure of the New Zealand dairy industry is totally out of whack with the rest of the world and the reset will be painful but a reality check. By the time this happens the dairy industry will look very different.

“There are lot of people who haven’t been looking closely enough at their costs because Fonterra has been the ‘sugar daddy’ that has kept on delivering excessive returns. Everyone has been really really happy and carried on, but now they are all looking hard at what they can do to change their business model.

“It’s not going to mean we stop doing dairy, but at present land is overvalued and the services and inputs coming into that industry are overpriced and now it’s

time for the industry to reset itself at an appropriate level.”

Gow says with Fonterra cutting jobs and farmers putting away their chequebooks and looking closely at prices they pay suppliers of goods and services, the cost structure of the industry will drop.

Gow was in Michigan, US, in 2010 when the global financial crisis (GFC) hit that state’s automobile industry very hard. He says there are similarities between what happened in Michigan and what is happening now to the NZ dairy industry. The US auto industry was built on high returns and wages in boom times.

“Auto workers there had huge pension plans and in many ways it’s not different in some ways from sharemilkers and lower order sharemilkers and investors in the NZ dairy industry. We’ve had massive price inflation on all the inputs coming into the industry for five-ten years. Here [we can have] a 26-yearold who can make $200,000 a year as a lower order sharemilker doing a manual job. These expectations are totally out of whack with what that [worker] should be [paid] on a global basis. All those expectations have to come back

Professor Hamish Gow, Massey University.

and be reset.”

Gow says New Zealand is lucky to have come through two GFC’s relatively unscathed, but this has now changed and everyone is going to have to reset their expectations and develop business models more appropriate to their likely

income. US and European dairy competitors have seen the high prices New Zealand has been getting for its dairy exports and have responded accordingly.

The high cull of poor producing cows will offer some relief, says Gow. But while the prices look great for beef

now, this as a short term opportunity and others will cash in on it.

Fonterra may need to change to compete more efficiently. Zespri has weathered the storm of PSa and is now getting greater returns for its producers than three years ago.

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DAIRY NEWS AUGUST 25, 2015

AGRIBUSINESS // 23

Resistant pests a global problem for ag sector MARK ROSS

A MAJOR global

challenge for the agricultural industry is pesticide resistance. A resulting loss of pesticide options can be costly and environmentally harmful.

Resistance occurs when a change in the genetics of a pest population allows individuals to survive. It develops in all agricultural pest groups, starting when a tiny number of pests survive a pesticide and become resistant.

For most New Zealand growers this is not yet a big problem. Though there are pockets of resistant species in some sectors, a wide range of products are effective

producer.

Weeds are adaptable to many environments.

For example, when lawns are repeatedly mowed close to the ground, weeds can overcome the lawn.

No surprise that weeds can adapt to certain herbicides. Weeds are also highly reproductive, with seeds that can survive for long periods and disperse over long distances.

Managing resistance requires an understanding of the factors that influence its development, and slowing or preventing the resistance from happening. Resistance should not be automatically assumed.

A number of factors need to be ruled out: was the pesticide misapplied? Was the weather unfavourable?

an integrated pest management strategy will mean one less problem for farmers.

• Mark Ross is the chief executive of Agcarm.

“It develops in all agricultural pest groups, starting when a tiny number of pests survive a pesticide and become resistant.” against pests. Such a range is crucial for managing resistance. But to keep a variety of products available, the makers must navigate a number of hurdles.

One big hurdle is the high cost of developing new products and re-registering older pesticides. In NZ the process is compounded by the low level of data protection for new application registrations, thus putting pressure on the companies’ profits.

To overcome this Agcarm is advocating a legislative amendment to achieve greater data protection, so encouraging companies to spend more on new product registrations and new technologies.

Another problem is the difficulty and cost to assess the level of resistance in weeds.

For example, extensive trial and error is needed to identify the cause of resistance in weeds resistant to more than one product. This can be expensive and timeconsuming for the crop

Was the application poorly timed? Was crop management poor?

When using fungicides, insecticides or herbicides, follow the label instructions, especially on rate of application.

An experienced advisor can help develop a spray strategy, but if the manufacturer’s instructions are not followed, resistance is more likely.

A good resistance strategy includes rotating pesticides, crop rotation, good hygiene and combining pesticide applications. Follow these five steps to manage pest resistance: ■■ 1. Apply pesticides according to the label – every time ■■ 2. Expect some level of resistance ■■ 3. Have a strategy to address resistance ■■ 4. Identify the root cause by trial and error ■■ 5. Get the right advice; talk to your supplier or distributor.

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DAIRY NEWS AUGUST 25, 2015

24 // AGRIBUSINESS

Being average is not good enough THE SEVERITY of the

recent change in dairy fortunes has certainly been a left-field event.

How such a dramatic change has emerged without warning and how businesses can best respond are key issues.

Also critical are maintaining perspective,

evaluating the role of diversification or income smoothing for more sustainable business plans, understanding the potential impact on balance sheets and responding to the dynamics of increasingly complex international economies.

The first priority must be to keep events in perspective and as much as possible stay optimistic. It’s essential the current negativity doesn’t become a selffulfilling prophecy.

It seems the market fundamentals driving confidence in dairy

markets to date remain intact.

Right now the dairy sector is hampered by media overexposure and is not helped by negative sentiment from farmers themselves about the management of their cooperatives. No doubt things could have been

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done better and people need to be accountable.

But there is little to be gained from whingeing or worrying about who’s to blame or what will go wrong next.

Solution focused businesses need to isolate themselves from this and build their strategy on credible industry comment, seek out wellinformed advice and restrict their diet of headline grabbing news.

The next step is rigorous analysis to evaluate scenarios and compare the current strategy with ‘plan B’ options.

One alternative could be to develop a ‘price smoothing’ philosophy either at industry or individual farm level.

In my view the current Fonterra interest-free loan ‘support’ scheme is in reality a price smoothing mechanism.

While this will buffer the downturn it will also dampen the recovery. If applied over the last five years, when milk prices have averaged $6.50/ kgMS, a more stable and sustainable trading and capital environment may have eventuated.

A second option is to recognise the benefits of diversification. It’s all very well to participate in a rock star industry.

However, risk is magnified when an operation is built on just one enterprise.

Yes, there are economies of scale by concentrating on one farming system, but this means greater exposure to economic, bio security and market risks.

Options to create diversity must now become a priority.

Alternatives such as dairy beef, cropping, horticulture or off-farm investment could help balance the portfolio.

These may offer more than economic advantages. They have the potential to improve environmental sustainability and reduce compliance costs currently impacting dairy operations.

Finally, industry forecasts need to be scrutinised to ensure assumptions for budgets and business plans are soundly based.

Despite the collective efforts of banks, government agencies, processing companies, exporters and experts across the industry the anticipation of the recent change in market conditions has been poor at best. Many will, like me, have attended conferences and presentations describing positive prospects for our industry. Most, like me, will be wondering how the investigation that underpinned that expectation could be so wide of the mark.

While some of the contributors to an oversupplied market, such as the removal of European production quotas, were widely anticipated, others could not have been predicted.

Disruptive events such as conflict in the Ukraine and embargoes causing product to be diverted to markets supplied by New Zealand dairy companies are more difficult to foresee. Technologies that have contributed to a step change in the availability of oil, consequent declines in the cost of feed combined with reallocation of crops no longer needed for biofuel to dairy rations have accelerated production in some key milk producing countries.

These types of changes can occur quickly. Their randomness means diversification and planned risk management have become entry-level tools for the modern farming business.

Yes, these circumstances are challenging. They also offer real opportunity for best practice operators who will benefit from an agile, informed, proactive business culture underpinned by dedication to capturing the benefits of technology and relentless focus on best practice.

This is without doubt an environment where average will not be anywhere near good enough. Expect a lot more change and a lot more opportunity as a result.

• Kerry Ryan is a Tauranga agribusiness consultant.

Email him at www. kerryryan.co.nz.

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DAIRY NEWS AUGUST 25, 2015

26 // MANAGEMENT

The true cost of home-grown maize silage brand ‘Maize for Silage 2015-16’ catalogue gives average estimated growing costs for maize silage planted in high fertility or low fertility paddocks (Table 1).

Average home-grown maize silage yields vary between districts and pad-

aged, the storage loss can be as low as 6%. Feed-out losses associated with bins are in the order of 5-10%2.

Pasture lost during the maize growing season varies greatly between farms. There are several things you must consider when trying to account for it.

Table 1: Average estimated cost of growing maize silage on-farm1.

Maize silage cost (c/kgDM) Maize silage yield in stack (c/kgDM) 18 20 22 24

docks but are typically in the range 18-26 tDM/ha.

Most maize silage crops take 120-160 days to reach harvest maturity.

Most dairy farmers use insecticide treated seed to reduce the time between the last grazing and planting maize to 5-20 days. This means the time from last grazing to maize silage harvest is normally 130–180 days.

Our costings do not include maize silage wastage or the amount of pasture lost in the growing season. Storage and feedout wastage rates vary greatly between farms and it is impossible to use one number. Where maize silage stacks are well man-

High fertility Low fertility paddock paddock (e.g. most (e.g. repeat cropping dairy farm paddocks, paddocks) effluent paddocks) 21.1 19.0 17.3 15.9

16.2 14.5 13.2 12.1

1. How much DM would the paddock have realistically produced?

DairyNZ research has shown that the best yielding pasture paddocks produce double the annual drymatter yield of the worst paddocks3. If your farm produces an average of 7 tDM/ha during the 5-6 months between spraying out a paddock and maize silage harvest, you will have good paddocks which produce at least 9 tDM/ha and low producing ones which produce no more than 5 tDM/ha. In my experience few farmers spray out their best pasture paddocks and plant them in maize! Remember that if you deduct pas-

ture foregone during the maize cropping period you should also deduct the variable costs associated with growing that pasture (e.g. fertiliser, weed and pest).

2. Pasture lost at different times of the year does not have the same value.

You could argue it is beneficial to take an area out of the round during spring as it increases grazing pressure on the rest of the farm, improving pasture quality. This will be the case on many farms this year when cow numbers have been reduced in response to the lower payout. There is a cost associated with topping or

making grass silage which are the other alternatives to manage a pasture surplus. Conversely pasture grown during the dry summer months or maize silage used to fill autumn, winter or spring feed deficits will have a much higher value.

3. Farmers need to separate the cost of regrassing and the time taken to establish new pasture from the maize cropping analysis.

If your paddock needs

regrassing, whether you spray out and go through a grass-to-grass programme or direct drill after a maize silage crop, the costs and the time taken for the new pasture to establish will be virtually identical. So unless the paddock did not need renewal, the time taken for maize cropping should just be last grazing to maize harvest – not last grazing until when the new pasture comes into the grazing round. If you choose to include the

costs of establishing new pasture in the maize silage gross margin, you must also include the benefits (i.e. higher yields of better quality DM over several seasons).

The take-home message is that costing homegrown feed isn’t as simple as some would suggest. A number of high-performing farms are using maize silage to increase the DM yield from their milking platforms and run-offs.

They have proven how this

strategy can decrease the cost per kgMS produced.

• Ian Williams is a Pioneer forage specialist. Email him on iwilliams@genetic.co.nz 1 Pioneer brand ‘Maize for Silage 2015-16’, page 42.

2 DairyNZ Facts & Figures p.31.

3 Romera A, Clark CEF, Clark D.A. Paddock to paddock pasture yield variation on dairy farms in the Waikato region of New Zealand. XXI International Grasslands Congress, Hohhot, China. 2 72.

Most maize silage crops take 120160 days to reach harvest maturity.

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Some highperforming farms are using maize silage to increase DM yield from milking platforms and run-offs.

DAIRY NEWS AUGUST 25, 2015

MANAGEMENT // 27

Protecting crucial soils BALA TIKKISETTY

GOOD SOILS are at the heart of farming in Waikato.

Soil quality monitoring

by Waikato Regional Council measures properties such as compaction, nutrient status, biological activity, soil carbon and organic matter at 152 sites. About 30 sites are sampled annually; they have a range of soils supporting various land uses.

The main soil quality issues identified are compaction, excessive phosphorous and nitrogen (N) on dairy and cropping land, and declining carbon, mainly on cropping land.

There is good news: some data trends suggest an improvement in some soil quality indicators, most likely the result of good land management by farmers.

But some measures in various areas are still causing concern, and improvements are needed: minimising humaninduced soil erosion and maintaining good soil quality are essential for maintaining soil ‘ecosystem services’ such as nutrient and water buffering, productive capacity, assimilating waste, and reducing the effects of sediment and other contaminants on water bodies.

The transformation of ‘natural capital’ -- namely soil, plants and animals, air and water -- into resources people value and use is at the heart of what we mean by ‘ecosystem services’.

The concept is gaining

attention nationally as we see environmental pressure increasingly applied to resources, such as soil health, that we once took for granted.

A number of practices help support and improve our soils, and provide clear benefits: ■■ avoiding over grazing and heavy grazing in wet weather (leading to compaction) ■■ avoiding under or overfertilisation ■■ appropriate use of pesticides and other agrochemicals ■■ managing pasture to maintain complete soil cover ■■ careful application of farm dairy effluent to optimise organic matter and avoid saturation.

There is also benefit in protecting farm wetlands, which deliver a wide range of ecosystem services such as improving water quality, flood regulation, coastal protection, and provide recreational opportunities and fish habitat.

An approach called ‘functional land management’ seeks to optimise the agronomic and environmental returns from land, relying on the various functions of soils. It focuses on soil functions specifically related to agricultural land use. They are: ■■ primary production ■■ water purification and regulation ■■ carbon cycling and storage ■■ functional and intrinsic biodiversity ■■ nutrient cycling New research is focussed on nutrient

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cycling in soil, such as the ability of soils to recycle N, carbon and phosphorus and how this can best be managed.

To reduce N leaching from soils, the research seeks to understand mechanisms for N retention in soil and how to manipulate soil processes to enhance de-nitrification.

As soil microbes are the key agents for nutrient cycling, scientists are intent on determining the impacts of soil management on soil microbial activity.

Waikato Regional Council’s work with farmers to increase the understanding of soil ecosystems, to manage them better and to protect them is suggest-

ing ways to improve water quality. They identify farming solutions and provide assessments of their effectiveness in managing various contaminants from farm land.

For more information see www.farmmenus.org.nz.

• Bala Tikkisetty is a sustainable agriculture advisor at Waikato Regional Council.

Bala Tikkisetty

DAIRY NEWS AUGUST 25, 2015

28 // MANAGEMENT

Disciplines worth observing for success Dairy farmers facing a two-three-year slog are more likely to endure it successfully if they heed 13 ‘disciplines for low income farming cycles’, says Mark Townshend.

FOR THE next couple of years, some

dairy farming challenges will be a reality.

It will be a slog for some, financially and psychologically. The first stage will be battling a milk price which for two years will be lower than the cost of production. The results will drag on another year as overdrafts and Fonterra loans need to be cleared.

Attached are 13 ‘disciplines for lowincome farming cycles’, all of which need heeding in combination.

1. Understand your current and medium financial position well.

We expect farmers to be good at managing pasture, animals and people, to be able to fix most things onfarm and to be financial managers. Few people are outstanding in more than two of these five categories. If financial management capability is not in your top two suits you will likely need outside assistance to assess your financial position. Just as you cannot solve feed budget shortfalls without an accurate picture of grass cover, supplements on hand and grass growth projections, so you cannot solve cashflow issues without knowing your true position.

2. Financial decisions you need to make.

Once you have a clear understanding of your current and pending financial position, identify the areas you need to address: a. increased income b. lower unit cost of production c. cost deferment d. deferred payment terms e. optimised debt servicing package

f. additional term debt g. injection of capital.

3. Identify whether you need someone to help address and solve those issues needing resolution in point 2 above.

It is likely that the specialist required to take the x-ray in point 1 above is different from the specialist needed to fix the issues arising in point 2 above.

4. Profitably increasing your income.

Increasing farm income usually comes about by ‘spending’ your way to higher income and/or ‘managing’ your way to higher income. Most likely only the latter will add any value during low income cycles. Managing your way to higher income requires making better use of available resources.

Can you grow more grass by better management? Can you utilise more grass by better management? Can you milk more cows through the spring as a result of lower wintered cow wastage? These are income increasers that require no spending. They require knowledge to be applied, extra sweat with electric fence feed allocation, more farm walks, less pasture damage, etc. ‘Spending’ your way to higher income means buying fertiliser or feed -- spending capital and expecting to show a financial return. This method may work during high income cycles but is unlikely to work when product price is low. Even during high income cycles this method will be questionable for the lower 50% capability farmers (we never

see 50% of farmers admitting they are below average – it is always someone else).

5. Lowering your cost of production.

Production costs rise when farmers get sloppy during times of high milk prices. They also increase because marketers are trained to sell you products you may or may not require, or higher spec products than required, and at the highest possible price. Many modern products are priced for the maker/supplier to capture all the benefits. For example, parasite pour-ons are much more expensive than oral drenches.

The maker/supplier pockets the farmer’s convenience of an easier job. Look at a rural retailer’s shelves and you may deduce that the use of oral drenches is now the exception rather than the rule.

100% nitrogen application on 90% of pastures, away from drains and races, will give better results than 90% nitrogen on 100% of the area. The first 15% saving of production cost can usually come about by buying 5% less product, choosing a brown-paper-bag/vanilla 5% lower-spec product, and by negotiating a 5% lower price.

6. Defer costs when these can be delayed one or two years without undue impact.

Examples: painting the house, maintaining low volume farm races, controlling non-threatening weeds and deferring some fertiliser. The deferment in all cases will have some negative financial impact but will likely be less than penalty overdraft rates and certainly are not worth losing the farm over. Of course some essential farm spending will be required to ensure the farm’s value is maintained and that compliance rules are adhered to.

Ngatea farmer Mark Townshend says the next few years will be a slog for some farmers.

7. Optimising debt servicing packages.

For many, or perhaps most, farmers interest cost will be the largest single expense.

Here is where the sort of advice referred to in point 3 above can add value. a. Is there a way you can reduce your bank overdraft, or term debt, by selling non necessary assets (animal, vegetable or mineral)? b. Can you show your bank that you have good financial understanding of your business, that even though your cashflow is tight it is quite manageable, and that debt principal repayments can be suspended for a period? c. Can you show your bank that despite your cashflow being very tight, you have a clear and planned pathway, and that some of your overdraft can be converted to lower interest term borrowing? d. Can you show your bank that you have a planned pathway that is manageable and that it could share some of the load by reducing the interest margin to a good customer? If you provide good information and then ask for a margin reduction you have a greater likelihood of success than by just waiting for the bank to offer.

8. Introducing fresh capital to your business.

This could come from the sale of some assets, capital injection from a family member or outside capital.

If it is outside capital, and it can be injected at full value (without any discount applied), then the question is as

simple as “will the business be better for a stronger balance sheet versus any ownership control lost?” If the business is in more desperate need of a capital injection, the chance is greater that a value discount will be required to attract fresh capital. In this case the debate is about whether the business can survive adequately without the discounted fresh capital or whether the discount is a reasonable price to pay for stabilising the business and peace of mind. For those who worry about a tight financial position, discounted fresh capital injection may be a wise option.

9. Surround yourself with positive people.

This is a key component when facing financial hardship. Attach yourself to people who are positive, but also realistic. People who have experienced tough times or are experiencing similar financial challenges to you will be good places to start. If you don’t like the feedback or advice you are getting from someone, don’t ‘shoot the messenger’, ie don’t block your ears to a message that is tough but realistic.

10. Do not delay when decisions or actions are promptly required.

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DAIRY NEWS AUGUST 25, 2015

30 // MANAGEMENT

Awards inspire farmers to improve MANAWATU DAIRY

farmers George and Ellen Bartlett entered the 2015 Horizons Ballance Farm Environment Awards (BFEA) because they wanted to support their industry and learn more about sustainability.

Winning three category awards in their first time in the competition was a bonus for the Bartletts, who run a 950cow operation on 526ha at Halcombe, north of Feilding.

“We certainly didn’t expect to win anything,” says Ellen, “we entered because we wanted to find out what we were doing right and what things we could improve on. We also felt it was important to support the awards because they do such a great job of showcasing the good work done by farmers.”

While business and

environmental sustainability has always been a key focus for George and Ellen, their involvement in the awards inspired them to keep looking for ways to improve further.

“The judging process spurred us into action [on] some areas where we can do better,” says Ellen. “It was great to have the judges come onfarm and offer us an outside perspective. They asked questions that were challenging in a positive way and George enjoyed answering them and explaining what we were trying to achieve.”

The Bartletts won the LIC Dairy Farm Award, the PGG Wrightson Land and Life Award and the WaterForce Integrated Management Award; the latter recognises farmers who have developed water systems for their own farms.

BFEA judges said the Bartletts manage and maintain their water resources to a high standard while continually investigating further water storage options.

“The farm is on a water scheme, so our water allocation is tightly restricted,” says Ellen.

“We don’t irrigate and we make every effort to recycle and re-use whatever water we can.”

For example, ‘green water’ collected in a thirdstage effluent pond is used for yard washdown. Rainwater is collected where possible, and all waterlines are constantly monitored for leaks.

“We have to be very careful with our water, so we treat it as one of our most valuable assets.”

The Bartletts also won praise for their staff management.

“Staff are very impor-

George Bartlett and wife, Ellen on the farm.

tant to us and when we entered the awards we got the whole team involved and explained what we were aiming to do. They were all supportive and the fact we won three awards reflects well upon them.”

Ellen and George encourage other farmers to give the Ballance Farm Environment Awards a

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go. “It’s not all about winning, it’s about learning.

Just enjoy the process and what you can gain from it,” says Ellen.

George says farmers

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Entry forms are available at www.bfea.org.nz

13 disciplines to observe FROM PAGE 28

delay is likely to carry the dual cost of lost opportunity and a greater degree of difficulty. There may be options your advisors can provide on tax related options, benefit entitlements, income equalisation, etc, that have only limited ‘windows’ of application or entitlement.

The quality of advice you get will often be most beneficial within a certain timeframe that may be limited, so timeliness is important. It is far easier to climb out of a hole 1m deep than a hole 2m deep. If you keep digging, the result may be a 3m hole –very difficult to climb out of without cost or other negative implications.

11. Limit your financial constraints to as few people as possible.

Delaying payment of monthly accounts should be an absolute last choice because: a. Farm servicing businesses need to be able to operate successfully in their own right, and your business will need them in the future. When financial adversity hits the farming sector farmers tend to complain a lot and rural service industries take the pain as farmers stop spending. b. When the period of financial constraint has passed, do not expect quality service and sharp pricing if you used those businesses as banks through the tough times. The cost of servicing a higher bank overdraft is more honourable than stressing your service providers. c. There is nothing wrong with prepurchase discussions with suppliers or service providers about delaying payments. The supplier then has the option to agree to your request, to agree to your request with some reasonable

cost consequence or to decline to supply you.

12. Prepare yourself mentally and physically for the added pressure.

Sleep well, eat well and be active.

No matter what age or shape you may be, exercising three times per week is refreshing and will promote good clear thinking. Help friends or family you may be worried about; they should be the first to help you in return. Take time off or throw a ‘hard times’ party; a good laugh is a tonic and everyone will be enduring some kind of hardship. Going to the doctor for a ‘warrant of fitness’ is worthwhile at any time; even more so in tough times as the most likely outcome is reassurance that your health is fine.

That in itself is a tonic.

13. Share the knowledge you gain with others.

Periods of financial constraint occur every three-five years. These require discipline but are quite manageable.

The more serious once-in-a generation type financial periods are defining and life changing. 2015-16 looks to be a once-in-a-generation event. Lifechanging means they can make you or break you.

Those with the fortitude, discipline and capability to prosper in times of adversity have a responsibility to help others in the future who experience the same sort of challenges. In farming very few of us invent things: most of what we learn, we learn from others and usually at no cost.

Those who benefit from the wisdom of others as they go through a difficult time have a responsibility to help others in the future.

• Mark Townshend, a former Fonterra director, owns dairy farms in New Zealand and overseas.

DAIRY NEWS AUGUST 25, 2015

ANIMAL HEALTH // 31

Growing calves to full capacity ENSURING EVERY

farm has ever seen, and that observers cannot distinguish the heifers from the cows.

“We give them a good start and keeping it going.

I like to measure everything so we weigh the calves every month. Once they’re at weaning weight, we split the mob into three groups depending on their weight, so we can keep an eye on the little ones and make sure they’re getting the extra feed they need.

“This means we pick up the scrawny ones when they’re only two to four weeks behind, not 12 months down the track when it’s harder to do anything about it.”

Conna also introduced feeding milk TAD, from OAD last season for the calves’ first couple of weeks, to help capture those falling behind in the early days and ensure the

has everything needed to develop calves’ rumens, it’s scientifically based and it’s the only product we need to use in the shed or in the paddock, so it makes everything streamlined.”

Though budgets are tight in this season and the Bourkes will be monitoring their feed consumption closely, they don’t expect to make cuts to nutrition.

Taranaki farmers Robert and Verna Bourke with daughter Conna Smith.

OPSJ0489

calf goes into the herd at target weight makes sure a Patea, Taranaki, dairy farm is running at full capacity, even on once-a-day (OAD) milking, says calf feed maker Fiber Fresh.

Robert and Verna Bourke have milked 190 Jerseys OAD for 12 seasons, and production is now comparable to when they milked twice daily (TAD). Last season the farm set its OAD production record of 62,000kgMS, only 500kg off beating its TAD record.

Robert attributes this to genetics and growing animals to their potential in their first year. The farm rears 60 calves per season.

“Our big thing is quality and milking OAD has given us… time to monitor our animals carefully, so that none are coming into the herd underweight.”

“We saw OAD as giving us a new challenge, and it gave us a better lifestyle and enabled us to simplify our systems.”

That is why the Bourkes decided to switch to OAD milking.

“After 40 years of milking cows the traditional way, we were disillusioned.

We saw OAD as giving us a new challenge, and it gave us a better lifestyle and enabled us to simplify our systems. But it also gave us the all important time to invest in our stock.

“That first year is critical if you want your calves to grow to full capacity; you can’t do it after that.”

The Bourkes’ daughter Conna and husband Nick have been lower order sharemilkers on the farm for three seasons and this season they are taking over fully as 50/50 sharemilkers.

Two extra pairs of hands means Robert and Verna can step back. “With four of us there’s always someone around and it creates more helpful discussion about the animals, their weights and where focus needs to be.”

Conna says this year’s heifers are the best the

growth of the animals’ skeletons.

“They were heavier because of it and they also took to feed much quicker.

We feed Fiber Fresh Fiber Start from day one, along with milk, and then once they’re on pasture we use Fiber Gain.

“We ad-lib feed the smaller calves as much Fiber Gain as they can eat, to bring them up to weight. Often those that started out smaller will put on more weight per day than those in the bigger mobs. Some are six weeks younger, but they’re still at the same weight.”

Robert says having underweight heifers coming into a herd is huge unrealised value. “It comes straight out of your milk production.”

He first came across Fiber Fresh nine years ago and started using it because of its nutritional value and convenience.

“When we switched to OAD we also wanted to simplify our feeding systems. Fiber Fresh

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DAIRY NEWS AUGUST 25, 2015

32 // ANIMAL HEALTH

GEMMA CHUCK

LAST MONTH we discussed the importance of colostrum, the consequences of insufficient colostrum feeding and how to assess colostrum management on farm. This month, we introduce the concept of colostrum quality, the factors associated with it and how it can be easily measured.

What does colostrum quality mean?

Newborn calves should be actively fed good quality colostrum as soon as possible after birth to reduce the risk of failure of passive transfer (FPT).

In this context, colostrum quality is referring to the concentration of antibodies (also referred to as “IgG”) per litre of colostrum. The higher the concentration of antibodies in a litre, the better the quality of colostrum. Good quality colostrum is defined as containing at least 50 grams of IgG per litre of colostrum. Poor quality colostrum is defined as being less than 50 grams IgG per litre of colostrum.

What affects the quality of colostrum produced?

The quality of colostrum produced is one of the hardest factors to influence in a colostrum management programme. Colostrum quality can be affected by many different factors including breed, parity, dry period length, volume of colostrum produced and time to first milking.

Jersey breed cows tend to have the highest concentration of IgG per litre of colostrum, whilst Holstein-Friesians tend to have the lowest concentrations of IgG per litre. This is associated with the high volumes of colostrum these breeds often produce, resulting in dilution of IgG present in the udder.

Previously, parity has been shown to affect the IgG concentration in

colostrum, with older cows having higher quality colostrum compared to younger cows. However, further research suggests there is no difference in IgG concentration with age. Some heifers produce excellent quality colostrum and the practice of discarding colostrum produced by heifers is now discouraged.

The production of colostrum in the udder starts about 4-6 weeks prior to calving. Therefore, the length of the dry period can significantly affect the quality of colostrum. Dry cow nutrition, transition management, accurate dry off dates from pregnancy testing, teat sealant and strategic vaccination where appropriate, are all integral components of a colostrum management programme.

The time between calving to first milking has a negative effect on colostrum quality. Colostrum quality in the udder rapidly declines at the point of calving and research shows that colostral IgG concentration decreases by 3.7% for each hour after calving. Cows and heifers should be collected from the calving area at least twice daily and milked as soon as possible. If cows are only collected once daily from the calving area, collection of the best possible colostrum has not been achieved.

Pooling colostrum is the mixing of colostrum produced by different cows and heifers, after collection.

The logic behind this was that it was supposed to minimise the impact of low-quality colostrum samples.

Unfortunately, this actually results in reducing the overall quality of the pooled sample, as good quality colostrum is now diluted with poor quality, and overall IgG concentration is less.

In reality, colostrum quality is highly variable from farm to farm and from cow to cow.

How do I measure colostrum

quality?

Direct measurement of colostral IgG can be carried out at a laboratory.

This is considered the ‘gold standard’ to which other indirect tests are compared.

However, the direct measurement of colostral IgG on farm is almost impossible in terms of practicality, cost and processing time. Indirect measurements of colostrum quality have been described, such as visual inspection, the use of a colostrometer and more recently the Brix refractometer.

Colostrometers are reasonably quick to use on farm but do have some limitations. They are significantly affected by temperature and for a known quality of colostrum, the colostrometer can differ by 0.8mg/ ml for every degree Celsius change in temperature. They are also very fragile, which can make them unsuitable in a farm environment.

The Brix refractometer is available in both optical and digital forms.

A cut-off of 22% Brix is deemed to equate to a cut-off of 50g/L of IgG, thus samples ≥22% Brix are considered to be of adequate quality. The benefits of the Brix refractometer are that measurements are not affected by ambient temperature and they are robust, easy and economical to use on-farm.

How do I use this on my farm?

The quality of colostrum can no longer be left to chance and guesswork. Routinely measuring colostrum quality with a Brix refractometer has been an invaluable tool as part of an integrated colostrum management programme. A simple system in using the Brix refractometer is to ‘grade’ colostrum according to the quality.

• Dr Gemma Chuck is a dairy vet working at The Vet Group in south west Victoria, Australia.

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DAIRY NEWS AUGUST 25, 2015

34 // ANIMAL HEALTH / FEED

Strategies to manage low pasture cover DARREN SUTTON

I will cover some basic things to do to manage this situation.

Manage what you measure You can only manage what you have measured.

If you think you are lower

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OAD milking may not reduce pasture demand but it slows the rate at which cows lose weight.

MANY FARMS are running with lower than target average pasture covers (APC) for this time of the year. The months

of June and July were cooler than normal so pasture growth rates have not been where they would normally be.

The two main solutions are to grow more grass and to reduce pasture demand.

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in APC, then measure it now with a full farm walk.

Yes, it is a crazy busy time of the year, but don’t think you have to walk the whole farm in one day. Do it over 2-4 days if need be.

Some APC can be quite deceiving with some uneven feed wedges, so the APC cannot be worked out simply by adding your lowest covers with your highest covers and then dividing by two.

Grow more grass The first principle is stick to your spring rotation planner (SRP). This is a must. Do not be tempted to allocate more area than you normally would. This will only get you deeper into a hole if growth rates stay low.

Nitrogen should be applied from now on as soil temperatures will typically stay above 8 deg C from August onwards.

Apply at 30-35kgN/ha. You can go back and do half the farm now if APC is low enough, and then follow the cows every 7-10 days.

Best to apply to covers in the 1400-2000 cover range for the best response.

Gibberellic acid can be applied to boost grass growth from now on as most round lengths are now fast enough to get an economic response. This is best applied 1-5 days post-grazing. Gibberellic acid will help bring forward pasture growth that would otherwise occur in September and October.

Note that subsequent pasture growth after the first grazing can be reduced. It is recommended that only one application is used in the spring to reduce the loss of root mass.

Don’t pug paddocks.

They can take three years to recover from serious pugging. In the short term, pugging or light treading damage slows pasture re-growth. Select paddocks carefully as to what mob goes onto the wettest soils. The late calving cows are usually the best mob to stand off at night on the yard.

Reduce pasture demand If you are carrying extra cows that you know are unlikely to become profitable, now is the time to cull them. If you feel your

stocking rate is higher than you can afford going into the season, then you may be better off taking the beef price at present than trying to bring a marginal cow into profit.

Cows are more resilient than we sometimes think. Cows are not being underfed if you are grazing to 1550, so hit that target and no more. If you start seeing no clumps left behind in the paddock, then yes, you are likely to be hitting 1400 residuals.

Better to hold cows tighter now, to be able to lift intakes in September.

Feeding supplements is obviously the quickest method to reduce the pasture demand. But are we going to make money at a payout most likely with a ‘4’ in front of it? PKE is the cheapest form of energy (after nitrogen). If your cows are grazing below 1500, then we can expect around 7g MS response per MJME fed.

PKE landed on farm and accounting for some feeding and wastage cost will mean this feed is about 35 cents/kgDM. A $4.00 payout will yield 31 cents back, so a small loss.

A $4.50 payout will yield 35 cents, so maybe a breakeven scenario. But this still may be the best decision to ensure cows do not lose too much weight and get back in-calf for next year.

OAD milking can be a good way to reduce pasture demand, but this is not immediate. Cows take 4-6 weeks of being milked on OAD in spring to reduce their intake levels.

So you may not reduce your pasture demand, but you slow the rate at which cows lose weight. Cows at mating need to be ideally BCS4.0+ and in a positive energy balance.

Potential milk losses can be expected on OAD, especially going past three weeks on OAD. These losses can be reduced by selecting the younger and lower producers.

Take time to assess where you are pasturewise and work out a plan to overcome the deficit that suits your own farm.

• Darren Sutton is a LIC FarmWise consultant.

DAIRY NEWS AUGUST 25, 2015

MATING MANAGEMENT // 35

Aim for a good calving pattern GETTING COWS in-calf quickly

is key to achieving a good calving pattern, says DairyNZ. Heat detection, pre-mating heats and bull management are key ingredients for a successful mating.

Getting these right will benefit the farm’s submission rate and six-week in-calf rate, it says.

The easiest way to spot cycling cows is to do pre-mating heat detection.

Use tail paint to pick out cycling cows. Use one colour tail paint to start, then a second colour as cows cycle and lose their tail paint. Within two weeks about half the cycling cows will have been identified. At three weeks, cows with the original colour are the

non-cyclers.

Calculate the herd’s pre-mating cycling rate using the InCalf book for the percentage of cows showing signs of heat before mating begins. If cycling is less than 75% by 10 days before the planned start of mating, heat detection has not been fully effective and/or there are too many non-cyclers.

At that stage it is time to seek advice and consider which options are available to improve heat detection during AB (artificial breeding) and treat non-cycling cows.

The best heat detection starts with careful planning, good observation and the effective use of detection aids.

Being able to interpret cow

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behaviour and other signs is critical, along with good record keeping and training for those doing heat detection.

Start by reviewing the farm’s heat detection skills. Does everyone know what to look for when detecting cows on heat? Then, decide which combination of aids the farm will use (tail paint, heat mount detectors, activity meters and heat synchronisation).

Tail paint Tail paint is an inexpensive and effective way to detect cows on heat.

Apply tail paint to all cows just before the start of mating. Touch it up at least weekly and check for cows with rubbed or broken tail paint during milking.

Re-checking tail paint for rub marks immediately before each cow’s insemination will avoid inseminating cows not on heat.

To help identify cows not yet inseminated or those only showing weak signs of heat, reapply a different coloured tail paint to recently inseminated cows once other cows no longer try to mount them.

Heat mount detectors Heat mount detectors can be

Heat mount detector.

particularly effective on farms with less skilled staff checking cows on heat - and when used with paddock checks for heat.

Applied to the cow’s backbone, the detectors will become brightly coloured and easily recognised.

Again, heat mount detectors should be applied just before mating starts, then monitored for activation and

removed at insemination.

Until the end of the AB period, the detector should be replaced after insemination, when the cow is no longer being mounted.

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DAIRY NEWS AUGUST 25, 2015

36 // MATING MANAGEMENT

World’s first automatic BCS system HAVING PROBLEMS

getting an accurate body condition score of your herd?

No longer, says DeLaval, which has launched the world’s first automated body condition scoring system.

The technology is based on a 3D camera fixed on a gate. Once a cow passes under the camera, the system recognises the movement and selects the best still image of the cow in the video sequence. The image is converted into an accurate BCS. “Most farmers understand the concept and benefits of BCS, but for

various reasons they are not doing it,” says DeLaval spokesman Fernando Mazeris.

“Now that we have… consistent, regular and accurate scoring, we see that the potential is huge.

“The technology is a world-first and completely changes the way the farming community will look at BCS. Achieving an accurate score is now extremely simple,” says Mazeris.

“It gives consistent and daily feedback on the condition of a herd without any work on the part of the farmer. That’s valuable information that can ben-

efit the health of the cow and the running and profitability of the farm.”

From its own studies DeLaval predict that regular scoring and optimising the score could help farmers as follows: Reduce cases of ketosis on farms by half.

Reduce the feed cost by trimming down the feed to overweight cows.

Increase milk yield from a herd where all cows have the optimum body condition. The system can mean an increase of up to 545kg during the first 120 days of lactation.

Reduce the number of open days by bringing the

The new technology is based on a 3D camera fixed on a gate.

BCS back to an optimum level as soon as possible after calving and so returning the cow to its normal cyclical ovarian activity.

Conception rate can be

improved by 50%.

Save the farmer time since the need for manual BC scoring is gone. The alternative is that it will save the farmer the cost of

bringing in feed advisors or vets to do the BC scoring.

Eliminates the subjective nature of scoring.

DeLaval is now selling the system in some coun-

tries in Europe, North and South America and Asia.

By the end of the year the system will be sold globally. www. delaval.com

Heat detection made simpler with paint TAIL PAINTING remains the most widely used form of heat detection in New Zealand, according to GEA FIL, the makers of Tell Tail heat detection paint.

FIL says Tell Tail, made and sold in NZ for 25 years, is proven and costeffective, designed specifically for dairy cow heat detection.

Product manager Wayne Cockburn says the product is unique and seen by farmers as the best tail paint available.

Innovation over 25 years has made the paint brighter, easier to apply and longer lasting, he says. It’s the only locally made tail paint containing fluorescent pigments -- six colours -enabling farmers to devise a painting plan for each stage in detection to pregnancy.

The applicator cap was developed 20 years ago, taking away the hassle of a can and brush. It is durable enough to last up to 21 days on the cow, subject to conditions and correct application, and when the cow is mounted will break down to provide easy visual indication.

Cockburn says testing on

competitor products shows most came off the animals too quickly; some didn’t rub off when the animal was mounted. “We continually benchmark against our competitors, so that FIL products stay abreast of the market.”

Another FIL product is Detail -- a water-based paint used by a growing number of farmers because convenient 10L pails and added benefits better suit it to larger herd applications.

FIL national sales manager Colin May and area managers are at hand to work with farmers in implementing practical herd management systems.

Says May, “FIL’s colour process of heat detection is a simple tool, enabling quick identification of cows coming into or on heat. For example, we paint the cows with red tail paint about three weeks after calving.

When the paint has been rubbed that indicates the cow has started her cycle and then green tail paint is applied. In cases where it hasn’t been rubbed, farmers are advised to involve a vet.”

Tail painting is still widely used for heat detection in herds.

When green paint is rubbed this identifies cows coming into heat on a daily basis. After AI, cows should be painted with blue; if the paint rubs off,

the cow is not pregnant. And yellow should be applied once the pregnancy is confirmed.

The tail paints are sold in rural

retail stores.

Tel. 0508 434 569 @dairy_news facebook.com/dairynews

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DAIRY NEWS AUGUST 25, 2015

MATING MANAGEMENT // 37

Feed intake data sets Oz breeding values THE LATEST Australian

Breeding Values (ABVs) will be under the spotlight when Australia hosts an international genetics conference in Lorne, Victoria, next month.

Australian scientist Jennie Pryce, who was a leader in developing the Feed Saved ABV through the Dairy Futures CRC, says it has already attracted international acclaim; Pryce will be one of the speakers at the Association for the Advancement of Animal Breeding and Genetics (AAABG) conference in Lorne from September 27-30.

AAABG is an association for scientists, animal breeders and those working in the livestock genetics business.

Australia’s team of internationally recognised geneticists will host colleagues from Ireland, Denmark, USA, Germany, Kenya and New Zealand.

Researchers will tackle some of the most significant opportunities available through genetic improvement, such as improved fertility, animal health, feed conversion efficiency, methane production and the use of new tools from genomics.

The Feed Saved Australian Breeding Value (ABV) was published for the first time in April - the culmination of eight years of research and development

by Dairy Futures CRC and local and overseas partners.

Using the ABV, dairy farmers can identify bulls that can save at least 100kg of dry feed matter per cow each year while maintaining milk production.

It is the first feed efficiency breeding value in the world to incorporate real feed intake data, as well as a prediction of feed required for maintenance purposes, making the trait more relevant for farmers.

Pryce says farmer engagement during the development of the ABV was critical to its success and its uptake.

“It’s all very well having a perfect economic index but if it’s not addressing farmers’ wants and needs it loses relevance,” she says.

Many of the hassles farmers have on farm are not very easy to calculate an economic value for.

To ensure the relevance of the Feed Saved index, the research team spent a lot of time identifying all the components that make up a genetic index.

“We looked squarely at economic drivers for Australian production and tried to context these in a genetic improvement perspective,’ she says.

“We needed very robust indicators of economic values for traits, for example, what have the trends been for the cost of feed over the last 10 years, we looked at the price of milk, looked at what has happened in changes for the cost of diseases.”

Pryce says Australia had become the envy of the world for the development of its Feed Saved ABV. “People are looking at us enviously as we are one of the only countries using real feed intake data to calculate new breeding values.

“Ours is called Feed Saved because that’s exactly what it is. Other countries may develop breeding values which are more like feed efficiency.

“We deliberately chose feed saved because that’s the goal farmers want.”

Pryce says the work has been presented twice in the USA, where they received favourable comments.

“A lot of people are looking to Australia in terms of guiding where they may go with their research.

“Canada is leading on health traits they have breeding values for, but we were competitive or even ahead of the US because of this Feed Saved breeding value.

“Our Workability traits are also looked at with envy by a lot of countries

Australia boasts the first feed efficiency breeding value in the world.

around the world.”

Speakers at the conference will include: ■■ Donagh Berry from Ireland will describe how they have merged databases from across the cattle production chain to better evaluate bulls.

■■ Kati Schoepke from Germany will talk about collection of

■■

animal health data and its use to select animals resistant to disease.

Mogens Lund from Denmark will describe the use of genomics in the Danish dairy industry.

Australian scientists to speak include: Pryce on selecting for feed conversion effi-

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John Morton who will address ‘does the benefit of high ABV bulls depend on your feeding system?’.

■■ Thuy Nguyen on selecting for heat tolerance.

■■ Iona MacLeod on genetic markers for fertility. http://www.aaabg2015.org/.

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DAIRY NEWS AUGUST 25, 2015

38 // MACHINERY & PRODUCTS BlueBeam sheds light during spraying.

Roger and Sarah Smith.

Light helps twilight spraying A CLEVER light from Tyri will suit

spray rig operators.

The BlueBeam 1010 LED light throws a long-distance beam over a concentrated area so is ideal for boom mounting; it will cover an area up to 20m.

It ensures operators can see if the spray pattern is uniform, and allows spraying to go on late in the day as light fades.

With a IP68K rating ensuring that electrics are protected from moisture generated by the spray noz-

zles, the bright blue light is said to be more effective than white LED’s or halogen lights as it gives a clearer view of each nozzle and helps the operator identify blocked or badly performing areas www.tyrilights.com

Sharemilkers, farmer glad they chose orange MARK DANIEL markd@ruralnews.co.nz

50% OFF priority delivery of Milford culvert pipe

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ROGER AND Sarah Smith returned from

China to New Zealand in 2012 to take up a 150 cow, 50:50 sharemilking contract near Pukekohe.

Thinking to change their 4000-hour tractor they noted it looked to be in good condition but was racking up repair and maintenance costs of $10,000 per annum.

Buying second-hand meant no guarantees, so they opted to go new, and get the peace of mind of warranties and reliability.

They wanted a tractor light enough not to damage their clay based soils in winter, yet capable of handling a 10 cube feed wagon and doing cultivation work, so they opted for a Kubota M100GX. The M100GX stood out from its competitors as offering much higher levels of specification and features to make life easier. With 8-speed power-shift as standard, auto-shifting and field cruise control,

this appears to be the case. This automation has come to the fore in recent months, as the Smiths tackled an ambitious re-seeding of one third of the farm with annual and perennial ryegrasses.

Roger says “the comfortable cab and ergonomic controls makes the tractor easy to drive, and excellent access and visibility are also right up there”.

These features are not lost on the farm’s owner, Grant Parkinson, who although aged 75 likes to keep his hand in on the farm, taking on much of the tractor work.

The tractor was bought with a MX T140 loader chosen for a good lift height and the availability of electronic joystick control, the latter being especially useful for accurate load placement.

Smith notes “the tractor/loader combination offers great visibility and makes loading maize silage from the pit into the wagon a breeze. The choice of the Kubota and MX has hit the mark for us in functionality and price”. www.kubota.co.nz

DAIRY NEWS AUGUST 25, 2015

MACHINERY & PRODUCTS // 39

Smaller 8-rotor tedders also works well on slopes MARK DANIEL markd@ruralnews.co.nz

POTTINGER HAS

introduced upgrades from the large trailed HIT tedder series to smaller 8-rotor models with working widths of up to 8.86m.

The headstock features a sturdy three-point pivoting headstock with absorber struts as standard and the best tracking performance prevents the tedder from jolting during operation are for working well on slopes. The horizontal headstock guidance provides high clearance at headland turns and prevents under-running on slopes.

The newly designed DynaTech” rotor unit and tine arm has been introduced, using smaller rotor diameters and either five or six curved tine arms and a new tine design to ensure optimum tedding quality and perfect ground tracking for a superior spread pattern for a more quicker and uniformed wilting of the forage resulting in higher quality.

This unique rotor geometry ensures forage cannot snag or wrap around the tine arms, and

a gentle uptake by the trailing, sweeping arms ensures the crop is subjected to less damage between the tine arms, and results in less crop losses. Spreading angles can be adjusted on each rotor in three steps without tools, and all rotors are equipped with 16 x 6.5-8 tyres, which are even better protected from contamination thanks to a newly designed axle.

An optional front jockey wheel system is available which ensures optimum ground tracking for ideal protection of the sward and forage.

The new HIT 8.91 T trailed version has transport wheels which fold up hydraulically over the rotors during operation, achieving an optimal centre of gravity and preventing oscillation while in work, and making it ideal for use with smaller tractors.

Operation is straightforward and is activated using a double-acting connection with sequential control.

Fenceline tedding systems are also available for all models to clear the crop away from fencelines. www.originagroup.co.nz

Smaller 8-rotor tedders have working widths of 8.8 metres.

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DAIRY NEWS AUGUST 25, 2015

40 // MACHINERY & PRODUCTS

Disc mower upgrade MARK DANIEL markd@ruralnews.co.nz

THE MOWERS will soon start rolling so it’s timely for CB Norwood Distributors to announce upgrades to its Kuhn disc mowers.

The new GMD 240, 280 and 310 units, with 6, 7 and 8 discs respectively, replaces the GMD600-800 GII series.

It has a new linkage frame claimed 70% stronger than the previous version, and more adaptable to a larger number of wheel spacings and tyre widths. This takes the form of a hexagonal sliding bar at the lower link point. There is also a strengthening of the link between the bevel gearbox, where drive enters, and the cutter-bar unit.

The 100 series cutter-bar has a low profile disc, with two blades for a clean cut, and can be specified with standard bolt up blades, fast-fit for quick blade changes or the heavy duty system suited to arduous use particularly in stony conditions.

The cutter-bar has the maker’s

Kuhn disc mowers are getting an upgrade.

Protectadrive system which upon impact allows the shaft to shear along a pre-machined groove, protecting the main drive components and allowing quick replacement.

The mower has adjustable suspension by means of a pressurised hydraulic cylinder, and adaptability to deal with slopes up to 35 degrees above, and 25 degrees below horizontal, while ensuring the ground

pressured is maintained to avoid ground damage, and to ensure quick re-growth The new series also has a reinforced guard frame to promote good crop flow and increased forward speed, and uses a rotary swath former on the outer edge of the bar to form a manageable swath for following operations. www.kuhn.co.nz

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The Iron Out System can deal with iron levels of up to 50ppm.

and reduced palatability can be a major problem, particularly for dairy farmers, who strive to get dairy cows to drink upwards of 70 litres of water per day for good production.

The Iron Out System from Longveld, based around a floating polymer media is capable of dealing with iron levels up to 50ppm, and producing from 12,000 to 200,000 litres of clean water per day.

In practice contaminated water is first passed through an aerator where hydrogen sulphide, the “bad egg” smell, and other gases are removed.

The aeration process causes the iron content to precipitate out as an insoluble compound, which is carried into the main separation area, and is trapped by the floating polymer filtering media. After passing through the media the “clean water” flows

by gravity to a storage area.

Over time the media will become clogged and restrict water flow, which results in a drop in water level in the main tank, and an increase in the level of the main feed pipe, which in turn creates a vacuum, which instigates a “back-wash” cycle.

At this point flow is reversed and clean water flows back through the media and takes any collected impurities with it to a back wash collector, and away to waste. As the media is refreshed water flow increases, and the level rises and the cleaning cycle recommences.

As well as being fully automatic and very low maintenance, the process is chemically stable, impervious to bacteria, and the expected lifespan of the cleansing media is about 15 years. www.longveld.com

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DAIRY NEWS AUGUST 25, 2015

MACHINERY & PRODUCTS // 41

Rolling out the 300,000th baler MARK DANIEL markd@ruralnews.co.nz

PATENT NUMBER

372140 won’t be very important to many, but to one of the world’s largest manufacturers of harvest equipment it was a building block to the future.

The patent for a knotter to bind straw was granted to Claas in 1921, and to this day it remains part of the company logo.

That knotter was used on stationary balers in the early years and became

part of the company’s first pick-up baler in 1934. Claas recently its 300,000th machine, a Rollant 454 Uniwrap round baler.

In 1958, Rheinhold, son of founder August Claas, built a factory at Metz, SE France, as the home for Claas forage equipment, particularly balers.

Now 400 employees turn out 5000 balers a year, badged Rollant, Variant and Quadrant.

The factory produces 21 different models, sold to 100 countries.

These harvest 25 different crop types: old

standards such as wheat, barley and oat straws, cotton in South Africa, peanut haulm for cattle feed in America, flax in Eastern Europe and

Claas recently rolled out its 300,000th machine.

the likes of miscanthus and reed canary grass in France.

The 300,000th machine will be used for promotional purposes.

40,000 cows say they prefer a Redpath clear roof shelter … if cow’s could talk

Prime Minister John Key (right) with Irish Ambassador Noel White at the National Fieldays this year.

T C E R I BUY D lands/CRT

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Irish eyes are smiling

Farm

N An effective and affordable on-farm shelter system N Multiple flooring options, or build over existing pads N Designed for Feedpads, Standoffshelters or Winteringbarns 40,000 cows already enjoy a Redpath shelter for improved feed control, better pasture quality and protection from poor weather

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IRISH FARM machinery sales are now a common-

place in New Zealand, as shown by the Irish presence at the National Fieldays.

In June 17 Irish companies exhibited, either via the Enterprise Ireland site and distributor sites. Confirmed sales exceed $1 million, and leads could yield $5m in sales.

Enterprise Ireland director for Australasia, Mary Kinnane, is delighted: “We’re proud of the relationship developed by these companies and the Fieldays event.

“Kiwi farmers are quick to see the value and improvements in efficiency this Irish-made machinery can offer. The event allows new and innovative Irish companies to show their products to the NZ market.”

Fieldays chief excecutive Jon Calder says, “we’re delighted to have welcomed 17 Irish companies and are proud of the relationships developed over the last nine years. We look forward to continuing to grow these links.” – Mark Daniel www.enterprise-ireland.com

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DAIRY NEWS AUGUST 25, 2015

42 // MACHINERY & PRODUCTS

Old favourite hits the mark MARK DANIEL markd@ruralnews.co.nz

WE’VE ALL got one, whether it’s the old t-shirt from the seventies, the old shoes even after the puppy chewed them, or that favourite spade with the handle taped up. The only problem is ensuring that the ‘domestic superintendent’ doesn’t go on an unannounced spring clean and throw them out.

So sits the Corolla Wagon, an old favourite

that’s been about forever, blends into the crowd in an understated way, and is as reliable as that old pair of shoes. Look closely because there are lots on the roads, and the registration plates would suggest that you can’t kill them. So what about the current offering?

First impressions are there haven’t been a lot of changes over the old model, but the introduction of a few curves to the body shell and some chrome and black on the front grille have tidied things up,

and colour coded door handles give a sense of cohesion to the design.

Jumping into the cabin leads to a first impression that the seat is a little soft, but as you drive it seems to give good support and is genuinely comfortable.

And then there’s that familiar feel, where everything falls readily to hand, as if you’ve been here before; a tribute to great ergonomics.

The Wagon gets the 1.5L DOHC engine with variable valve timing and punches out 80kw

without any fuss, though appears slightly harsh at takeoff. The test car was fitted with the optimised CVT transmission that strives to match engine speed to forward speed and it seems to do it quite well; while the first impression is that you’re not going very fast, the speedo suggests otherwise. It’s all so easy and whether you’re in town or on the open road the kilometres pass by.

The transmission also has optional manual mode which offers seven speeds, but why would

An old favourite, Toyota Corolla wagon.

you? Drive mode is so easy. The car is also easy on the pocket -4.4L/100km, in line with the same company’s small hybrids, 14% better than the previous version The rest of the

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is as you would expect: plenty of legroom for the rear passengers, rear seats that split 60:40 for long narrow objects, and a rear load area holding 407L in standard set-up or a cavernous 972L with the seats folded.

In summary, the Corolla does what it says on the can so you probably couldn’t find better in the mid-size wagon sector. It gets along quickly without effort, won’t break the bank at the fuel pumps and has heaps of room in the back: great for the school run, or collecting a few bags of calf pellets.

Just don’t let her indoors catch you! www.toyota.co.nz

First impressions are there haven’t been a lot of changes to the old model.

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package surprises too, with a specification called GX but offering much more: vehicle stability control, traction control and hill start assist.

There’s also keyless engine start, a start-stop feature for the engine in a bid to save fuel when stationary, and electric power steering that’s well weighted and offers the right degree of feedback.

Other controls are straightforward, including good old round knobs for heater, radio and other key functions, Bluetooth, USB connection and a standard audio jack.

The rest of the interior

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SF “ SUGA sugar beet ™

“Sugar beet is a good source of energy. We milk virtually right through the year and in winter in the barn it’s an ideal feed.

It helps with getting our average of 305 days in milk per cow.

We have the cows in calving condition before they dry off and sugar beet helps us to get to that.

Yields range from 22 tonnes per hectare to 30t/ha. We start harvesting at the end of April and go right to the beginning of October. We feed it in the barn and on the feed pad.

Because of sugar beet’s high dry matter (DM) content at 24%, it is chopped before feeding to help with palatability for the cows. The milking cows get 2-3kg each per day from May right through until Christmas. The beauty of sugar beet is its high ME and DM content and the fact it’s more drought resistant. Its roots go down deeper and it hangs on better.

The cows love it. We put it in a mixed ration and they actually look for it. They dig through and it’s the first thing they eat.

At the run-off we harvest the sugar beet at the end of April and then grow winter wheat on those paddocks, so you get another crop in. There’s no pugging and as soon as we harvest, if the conditions are right, we can sow the same day as harvest.” John Van Hout

SF SUGA™ is a game changer that can help you achieve substantial increases in production. Seed still available - contact Seed Force today on 0508 733 336 or visit seedforce.co.nz

“WE CAN GROW & HARVEST IT FOR 18-20¢/KG DM”

BEET IS A COST EFFECTIVE OPTION THERE’S NOTHING ON THE MARKET AT THAT PRICE. IT’S COST EFFECTIVE, IT FITS WITH OUR RE-GRASSING PROGRAMME AND WE’RE HARVESTING THE NUTRIENTS FROM THE EFFLUENT PADDOCKS.

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JOHN VAN HOUT DAIRY FARMER, SOUTHLAND

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Licensed REAA 2008

Helping grow the country

coloUr process oF HeAt Detection pre-mAtinG HeAts

1. Paint all cows with reD tail paint approximately 3 weeks after calving.

Then observe the painted area for signs of the paint being rubbed. When it has been rubbed the cow has started her cycle. In cases where it is not rubbed (non-cycling cows), seek advice from your animal health professional.

DetectinG HeAts

HeAt Detection Tail painting visibly shows when cows are coming onto or are on heat as they stand to be mounted by other cows and the paint is then visibly rubbed.

How to Apply tAil pAint Healthy cows (non pregnant), free from infection will cycle every 18-24 days. Research shows the ‘in heat’ period typically lasts 6-24 hours. The average is 14 hours, shortest 2 hours, longest 28 hours.

2. Paint all cows with Green tail paint immediately prior to commencing your artificial insemination programme.

This identifies cows coming into heat on a daily basis.

inseminAtion

HeAt Detection timeline over 12 weeks plAnneD stArt oF mAtinG (psm)

3. After inseminating the cows immediately paint them BlUe. This will tell you if she has held to the service (if the paint rubs off, the cow is not pregnant).

Breeding Program Pre-mating 1st round of insemination

RED - pre-mAtinG HeAts 30 days prior to PSM

GREEN - wHen HeAt DetecteD BLUE - wHen cow inseminAteD

2nd round of insemination

PINK - For retrUn inseminAtion cows Optional ORANGE - lAte cAlvinG cows

Pregnancy Confirmation

For seasonal or synchronised mating programs only

preGnAncy conFirmAtion

YELLOW once conFirmeD preGnAnt AFter 12 weeks

YOUR FORMULA FOR QUALITY MILK

4. Paint all cows with yellow tail paint when pregnancy is confirmed.

Missing heats can

cost thousands

• Most Cost effeCtive forM of heat detection • easy application and identification • new Zealand’s leading and Most trusted tail paint brand for over 25 years Call 0508 434 569 to speak to your local FIL Area Manager about your tail paint requirements.

YOUR FORMULA FOR QUALITY MILK