Dairy News 08 March 2016

Grass back in fashion. PAGE 3

SKY’S THE LIMIT Farmer hunts Supernovas PAGE 12

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Super sales at auction PAGE 37 MARCH 8, 2016 ISSUE 352 // www.dairynews.co.nz

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Grass back in fashion. PAGE 3

SKY’S THE LIMIT

Farmer hunts Supernovas PAGE 12

MACHINERY SELL-OFF

Super sales at auction PAGE 37 MARCH 8, 2016 ISSUE 352 // www.dairynews.co.nz

$20 MILLION FACELIFT Terry Lee, Shanghai Pengxin, outlines remedial works carried out on ex-Crafar farms. PAGE 10-11

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DAIRY NEWS MARCH 8, 2016

NEWS // 3

Grass will be back in fashion PETER BURKE peterb@ruralnews.co.nz

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FORMER FONTERRA director Greg Gent says

grass will become fashionable again as the effects of lower dairy prices continue.

The Northland farmer believes this one of the positive consequences of the current crisis.

“Our comparative advantage in the world is grass, and not all dairy farmers moved away from that,” he told Dairy News at the opening of Shanghai Pengxin’s Central North Island Dairy Academy in Taupo last week.

“There was quite a chunk of farmers who’ve stayed with that straightforward farming system.

Moving back to greater use of grass and less reliance on supplements will make for a stronger industry,” he says.

Gent says in the days when New Zealand was getting $US5000 a tonne for milk powder any farm system could work and make money.

But the fallout from the price downturn is now showing, and as a result farmers will probably take a different view of risk management; they will look at how they handle risk and maybe build more resilience into their businesses -- a positive consequence.

One concern raised by banks over the years has been the lack of financial literacy of some farmers, but Gent says risk management is a bigger issue.

“You can blame all sorts of things. You can

Colin Armer (left) and Greg Gent at Shanghai Pengxin’s dairy academy opening last week.

equally say that banks have had a fairly short corporate memory. I would translate financial literacy more as risk management... and if I saw a weakness it would be that,” he says.

Farmers will in time take greater ownership of their budgets, instead of these being largely owned by the banks Gent says. Farmers will get into developing various scenarios and planning for these.

Another former Fonterra director, Colin Armer, says clearer market signals from Fonterra would have been useful for farmers trying to manage through the present difficult times. While the low dairy prices can’t be blamed on Fonterra, clearer sig-

nals would have helped.

Armer says restoring profitability to the industry requires a move back to basics -- volumes of production coming off farms and the cost of production.

“There will have to be a reset and some costs taken out of the business. We don’t know how long this oversupply situation will last, but in the meantime people can’t go on banking losses.”

Armer says the present crisis arose from many factors including the Chinese market going off the boil, increased dairy production in Europe and US and trade bans imposed by Russia. @dairy_news

facebook.com/dairynews

PAYOUT GOT TOO HIGH – HAMILTON THE $8.40/KGMS payout was probably the worst thing that happened to the dairy industry, says family corporate farmer Trevor Hamilton.

He says in the present era of market volatility and low payouts, farmers need to go and check the balance sheet and really delve into their cost structure.

Hamilton, who has farms in the North and South Islands, says farmers need to

get costs down to about $3.50/kgMS. “My personal view is that if you average the Fonterra milk price over the last ten years it’s about $6.00.

So medium term if you have a sound business at about $6.00 you are probably ok. But if you haven’t, you could well do with an assessment of your business.”

Hamilton says dairy companies such

as Tatua and Westland Milk Products, with a higher percentage of value add products, are more shielded from the volatility of the commodity market. He says while Fonterra does have some value add products, it’s a very small percentage of their business. But he says it’s hard to blame Fonterra for this given that they have to take all the milk produced in NZ.

DAIRY NEWS MARCH 8, 2016

4 // NEWS

NZ loses influence on global prices SUDESH KISSUN sudeshk@ruralnews.co.nz

NEW ZEALAND

appears to have lost its ability to influence global dairy prices, says Rabobank analyst Thomas Bailey.

He says historically when NZ milk production dropped, prices shot up. But not this season: despite analysts forecasting a drop in milk production of up to 10%, prices continued to fall.

Bailey told the Federated Farmers Dairy

council conference in Nelson last month that Rabobank was forecasting NZ milk production to be down at least 5%.

“But prices did not respond; they continued to drop… because they knew they could just go to Europe to get that milk now. NZ appears to have temporarily lost the advantage of influence on prices.”

Bailey says NZ’s inability to influence prices is one of five “tectonic shifts” happening in the dairy industry. Others are the

growth in Europe’s milk production, demand slowdown in China and Russia, low oil prices and growing appetite for value added dairy in the US. The EU has pumped 9 billion litres of extra milk into the market over the past 24 months -- the equivalent of NZ growing 50%. This has caught everyone off guard.

“The market is completely oversupplied; that’s why we are getting US$1800/t for milk powder.”

On the demand side, China is importing

Thomas Bailey, Rabobank analyst.

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Added to this is the low oil prices affecting consumer demand for dairy in the oil-rich Middle East and North Africa.

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“Oil income is down and economies are struggling with a price of US$38 /barrel; we see demand down in Algeria, Nigeria, Iran and Saudi Arabia.”

Bailey says conflicts in the region are adding to dairy’s price woes. But

According to Bailey, dairy and oil prices are “about 86% correlated”.

“There is a direct relation between oil and dairy when it comes to demand.

“The Middle East and North Africa, huge importers of dairy, and South America, the largest importer of NZ dairy products, are impacted.

he expects dairy prices to bounce back before oil prices.

Last week’s latest GDT auction saw the price index up 1.4%, its first rise this year. More importantly, whole milk powder prices rose 5.5% to US$1974/tonne. Skim milk powder was up 1.3% to US$1802/t. @dairy_news facebook.com/dairynews

DAIRY NEWS MARCH 8, 2016

NEWS // 5

No takeover plans despite OIO fears PETER BURKE peterb@ruralnews.co.nz

THE PRESIDENT

of Shanghai Pengxin Investments in New Zealand, Terry Lee, says the company’s future investment in the NZ dairy industry is being thwarted by the rules imposed by the Overseas Investment Office (OIO) which approves land purchases by foreigners.

He says the rules need to change and be clearer for investors.

Lee says many people misunderstand Shanghai Pengxin’s investment

intentions; there is no fear of them taking over the country.

“This is a wrong perception about Shanghai Pengxin. There is no other Chinese company coming to NZ and buying dairy arms and we are quite small in percentage terms compared with other investors from Europe, America and Australia.”

Lee says his company is also invested in real estate and hotels in NZ and is keen to build relationships here. The company would expand its interests in dairying or other types of farming if opportunities arose.

Milk from Shanghai Pengxin farms are processed by Miraka for China.

El Nino no-show helps Miraka suppliers THE NO-SHOW of El Nino has been a boon to farmers supplying Miraka, the Maori owned dairy company located near Taupo.

Chief executive Richard Wyeth says farmers are doing well for grass, but are challenged by the milk payout. His main concern now is the farmer suppliers and how they are coping.

“Suppliers are doing everything they can that’s in their control. One told me recently that he was looking to strip costs out wherever possible. Obviously they are going to keep farming but they know that the future of the payout is not great short-term so they just need to pull back on expenditure.”

Wyeth says production is down 7% on budget and he expects this trend to continue into next season. It results from farmers reducing cow numbers and feeding fewer supplements to cows during the peak.

“Ironically while production for the season is down, we’ve had the highest milk output ever for this time of the year. We’ve had a fantastic summer-autumn. People are still cutting silage which for this area is unheard of.”

Wyeth says there is plenty of evidence that farmers are returning to pasture feeding and are using fewer supplements.

“We believe NZ is a modern country with a good legal system and well educated people,” Lee says.

“I hope in time NZ people will understand more about Pengxin and more

about our strategy and our contribution to the local economy and society.”

The company’s long term strategy is to seek partnerships and joint ventures.

Shangai Pengxin New Zealand president Terry Lee.

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6 // NEWS

First students busy at dairy academy PETER BURKE peterb@ruralnews.co.nz

A NEW training facility for aspiring dairy farmers and herd and farm managers in the central North Island has its first intake of students.

The Central North Island Dairy Academy is a $1.1 million project by Shanghai Pengxin on its Ariki farm on the outskirts of Taupo.

The venture is a collaboration by Shanghai Pengxin and Landcorp

Farming’s joint venture company, Pengxin NZ Farm Management; it was a condition under which the Chinese company bought the former Crafar farms.

Six men and four women have begun their tuition in the inaugural 32 week live-in programme which combines theory and practical training with onfarm experience.

Teaching staff are from Taratahi Agricultural Training Centre and the practical learning happens on the Ariki dairy farm.

The students are housed on nearby farms.

Graduates will be awarded Massey University’s Diploma in Agriculture (Level 5).

The programme is designed to appeal to people with some technical skill or knowledge in dairying. The official opening of the classroom facility was attended by representatives of Shanghai Pengxin, Landcorp, Taratahi, Massey University, and government and industry.

The deal to set up the

academy was negotiated by the former chief executive of Landcorp, Chris Kelly, who is now the chancellor of Massey University. He was among the many guests present and says it was great to see the facility finally open.

Pengxin Farm Group chief executive Andy MacLeod says leaders will be needed in the dairy industry to succeed the present cohort of farmers as they retire. He sees the academy as a small stepping stone for the industry, given that it will produce

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Jaymee Smith serves tea during the opening last week.

only ten graduates when there are 12,000 dairy farms in NZ. He says good leaders will be needed to manage those farms economically and sustainably; the new facility is the company’s contribution to the industry to promote young people coming through.

In addition to paying for the building, Shanghai Pengxin is putting in about $350,000 a year to run it. It cost the students nothing

our network and come and work on our farms.

The benefits to us and the industry speak for themselves.”

MacLeod says it would be easy to replicate the facility in the South Island.

He would like to work with other industry partners on such a venture.

He likes the way the students get to mix with farm staff and gain an appreciation of what farm life is all about.

– their tuition, accommodation and food are free.

In May 2017, when Landcorp’s contract as the sharemilker for Shanghai Pengxin ends, it will step aside. But this won’t change anything, McLeod says.

“I guarantee right now Shanghai Pengxin will maintain it. This is not even a question we ask. We should get enough benefit out of this if the students who come here learn

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LANDCORP CHIEF executive Steve Carden says Landcorp is committed to developing young talent in New Zealand agriculture and the dairy academy will sit beside Landcorp’s other investments in training nationwide.

“There is strong demand for skilled people, particularly in midmanagement roles such as herd

or production managers and we’re proud of our involvement in this initiative,” he says.

Though Landcorp’s joint venture with Shanghai Pengxin and the academy will end in May 2017, Landcorp says the students will have opportunities to work on its farms occasionally to gain work experience.

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NEWS // 7

$8kg/MS payout ‘will return’ PAM TIPA pamelat@ruralnews.co.nz

THE WORLD has changed and we need to understand that, says Mike Petersen, special agricultural trade envoy.

Nimbleness and agility is the key – both for farm businesses and for the bigger companies.

“I don’t think we understand well enough the level of volatility that will continue for the foreseeable future,” the former Beef + Lamb NZ chairman told an Agcarm conference in Auckland.

Dairy farmers are sick of hearing it, but the future is still bright: the fundamentals are incredibly strong, Petersen said.

Finance Minister Bill English had been reported as saying we will never $8/ kgMS again. “Well, he is wrong: I guarantee we will.

We will see $4/kgMS again as well,” Petersen says.

“That’s what’s happening in these markets.”

Market insights and market intelligence will be important in the next 12-24 months, he said.

Food retailers now operate on just-in-time delivery. NZ produces 30% of the cross-border trade in dairy – that will always get hit first and hardest by volatility. Domestic producers will always be more cushioned.

“We need to build a bit more resilience. I get a bit frustrated with farmers moaning about volatility….

looking for someone else to fix these problems.

“What we don’t do well enough in NZ – as growers and producers – is set ourselves up to be more resilient in the face of this volatility.”

Our country of 4.6 million produces enough food for 40 million people, Petersen said.

“So we’re not looking to sell food to the masses.

We’re looking to target those discerning consumers who will pay premium prices for our quality products.”

The world was built on self-sufficiency in food but now, with scarce resources and a lack of water, countries are realising they can’t rely on producing food themselves forever.

So the sector will see volatile times but also continual upward movement in demand.

Petersen says to succeed in the world we need to be much more nimble and agile than ever before.

“The big companies and corporates are struggling with the pace of change happening worldwide. The pace of change is phenomenal.

“Very often the big companies don’t see it coming or when they do it is very hard to react, it is hard for them to turn around, it is hard for them to engage in an intimate way with a lot of the customers.

“My advice to big companies is ‘yes you have a future’. But in my view

WATER POWERS MILK FRESH MILK opportunities in China should be explored among consumers there concerned about the quality of their water, say two agricultural experts.

Special trade envoy Mike Petersen says only about 10 years ago the dairy industry was saying we shouldn’t be shipping fresh milk or milk with water in it. With freight costs it was more efficient to dry it for shipping around the world.

“But New Zealand’s comparative advantage is water, and food is virtually water, and many countries now are importing food because they don’t have enough water to grow their own,” he says.

“We have to think about this smartly; there are real opportunities for us and people understand that the integrity of food production is important when you get it from a single source.

“In NZ the opportunity for us has to be in fresh products that can contain the water – that is part of the story.”

you need to start to break yourselves down a bit and get into smaller more agile groups to deal more intimately with groups of consumers rather than countries and markets.”

Nimble and agile is the key, he said. Big international food companies like Tesco and McDonalds have been challenged in adapting to the pace of change.

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DAIRY NEWS MARCH 8, 2016

NEWS // 9

Mozzarella miracle plant opens RICHARD COSGROVE

TWO PERCENT isn’t much, but at Fonterra’s Clandeboye site a revolutionary cheese plant only required 2% of the site’s 45ha to rock the cheese world.

After years of hard work, and a huge team effort across Fonterra, the super-secret plant has cut the mozzarella cheese making process from three months to six hours.

Each day the plant makes enough mozzarella for around 825,000 pizzas -- annually that’s 300 million pizzas!

The plant was officially opened by the Minister for Science and Innovation Steven Joyce and Minister for Food Safety Jo Goodhew in a function attended by 200 staff, farmers, scientists and dignitaries.

To protect the intellectual

property behind the unique process the opening was held across the road from the plant at the former Clandeboye Primary School.

Marketed as the biggest secret since the 11 herbs and spices, the production process is jealously guarded by Fonterra.

Access to the plant is severely restricted, so much so that some co-op senior managers are not allowed inside.

Managing director global operations Robert Spurway says the innovation behind the groundbreaking time reduction is part of Fonterra’s strategy to add value to every drop of milk and therefore to shareholders.

Spurway says this type of innovation is crucial to Fonterra’s success and they are spending $80 million per annum on R&D. The mozzarella plant was a

Science and Innovation Minister Steven Joyce tastes mozzarella cheese pizza at the Clandeboye plant.

demand-driven investment, and they succeeded in developing an innovative natural process that has mozzarella ready for export in six hours, which they can adjust to individual customers demands.

Joyce brought a smile to faces when he described his recent run-in with a sex toy at Waitangi Day as “doing his best to market New Zealand glob-

ally”, but said “he still needed to work on his brand message”.

On a more serious note, Joyce said dairying had been in the spotlight for all the wrong reasons; the long-term story is positive for dairying and NZ food has excellent prospects worldwide.

The mozzarella plant came from one of the Government’s primary growth partnerships (PGP) which are designed to increase productivity in the primary sector. Mozzarella is a big part of the Fonterra story and will allow the co-op to uncouple from the commodity market, always in ebb and flow.

In highlighting the importance of Clandeboye to the co-op, Fonterra director Leonie Guiney said dairying is worth $3 billion to Canterbury and 18% of NZ cows are milked at Clandeboye.

New plants, more jobs SIXTY NEW dairy process

jobs were created when Fonterra opened four plants in the South Island recently.

First came the Mozzarella plant at the Clandeboye site, followed next day by Deputy Prime Minister Bill English opening three plants at the Edendale site in Southland.

The three were an anhydrous milk fat plant, a reverse osmosis plant to make the dryers more efficient and a milk protein concentrate plant.

Some 200 people attended -Fonterra farmers, staff, iwi and central and local government representatives.

Fonterra managing director global operations Robert Spurway said “Investing in dairy processing in towns like Clandeboye and Edendale supports the local dairy workforce, brings opportunities for tradesmen, consultants and contractors and has a flow-on effect for local businesses.”

Leading up to the 60 process

jobs, the projects have also provided work for thousands of people during construction.

Spurway said “While our preference is to fill roles locally, these expansions are also a drawcard for people looking to move in from outside the region, bringing investment in housing and infrastructure.”

These new plants help Fonterra to shift milk into more products that deliver higher returns.

After attending both events, Fonterra director Leonie Guiney said “the site expansions had already contributed to Fonterra’s improved performance in the first quarter of the current financial year”.

“Our new plants enabled our co-op to avoid incurring additional costs at the peak of the current season. We are achieving higher yields and quality, and the flexibility to vary our product mix is enabling us to earn margins above the prevailing market prices.”

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DAIRY NEWS MARCH 8, 2016

10 // NEWS

$20 million gives new life to c Shanghai Pengxin recently showed off its upgrade of the former Crafar farms it bought in the central North Island in 2012. And before attending the opening of the new dairy academy on one farm, guests toured Pineview, a farm on the plateau near Reporoa. Peter Burke was there.

PINEVIEW IS one of 16 farms in the North Island bought by Shanghai Pengxin. This is one of four farms near Reporoa; the others are in Waikato,

Taranaki and Manawatu.

Shanghai Pengxin also owns 13 dairy farms in the South Island.

Visitors were bussed to Pineview and, from under

umbrellas, saw changes made there and on the other farms.

Pineview runs 1130 cows on a 385ha milking platform, producing

461,000kgMS. The irrigators were going during our visit but good, unseasonal rain has helped the grass grow well. The farm looks in good shape.

‘WE DON’T NEED TO OWN EVERY COW’ ALL TOLD, Shanghai Pengxin owns 29 farms (16 in the North Island) and runs 30,000 cows on 12,000ha, producing about 19 million kgMS annually.

Landcorp recently gave notice that it would not seek to renew its North Island-farm sharemilking contract with Shanghai Pengxin when it expires in May 2017. The length of notice given by Landcorp is most helpful, says Andy

MacLeod.

“Normally we wouldn’t have been told this until December so we have well over a year to plan that transition.

“The fact is we are already milking 18,000 of the 30,000 cows, and we have good skills at Purata in the South Island where our farms are located and among our staff in the North Island.

“I have told my masters that

Heading the tour party was Terry Lee, now the managing director of NZ Milk and president of overseas invest-

we don’t need to own every cow and the share milking model is a good one that’s worked well for years.”

But MacLeod acknowledges that the present volatility in the dairy industry makes it hard for sharemilkers. New contracts that take into account such volatility may be necessary in future, he says.

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ment for the Pengxin Group.

Lee told Dairy News of his pride in the farms’ rapid improvement: $20 million of new infrastructure including 300km of fencing, 900 water troughs, 1500 gates, four houses, five effluent ponds and two cowsheds.

“We did everything we could to improve the farms, including improving animal welfare and taking care of the people who work there.

Shanghai Pengxin NZ Farms chief executive Andy MacLeod.

DAIRY NEWS MARCH 8, 2016

NEWS // 11

o clapped-out farms We have achieved a lot with the help of Landcorp, our joint venture partner.

“We see the farm as an asset, but the real asset is the combination of farm and people. Without good management and people the farm is not going to produce to its capacity.

“We want to be a good corporate citizen in New Zealand and the care of people and animals are most important to us,” he says.

Lee came to NZ with his family in 2003 and says he enjoys the clean green nature of the country and the friendliness of the people.

Pengxin NZ Farm Group chief executive Andy MacLeod says the North Island farms were dilapidated when his organisation took them over. (The South Island farms they bought from Synlait in 2014 were much better.)

An immediate, sharp focus on the North Island

farms after the takeover improved animal welfare and staff accommodation. Landcorp, the North Island farm sharemilker, quickly nipped problems in the bud. Now performance and productivity are trending in a “pleasing way”.

Pineview shows some signs of its past -- old water troughs and sheds stand alongside new purpose built sheds and fences. There’s a new effluent pond and rotary milking shed.

But, like Lee, MacLeod is people focused.

“It’s very easy to put people in a bus and show them a nice new shed etc.

There are four farms up there on the plateau and two are old herringbones and they have a long term future. So it’s not all about new sheds and effluent ponds, it’s really about the people and having good accommodation for the managers and their partners who live here. We

SHAREMILKERS STAYS, REAPS REWARDS ANTHONY KIFF joined Landcorp immediately after the Crafar farms came into Shanghai Pengxin ownership and Landcorp took over as the sharemilker. He now manages Pineview and says there’s been massive improvements since he arrived.

“When I first came here it was challenging and trying. I spent a lot of hours in the shed due to the poor facilities -- a 64-aside herringbone where you could only cup about 55 cows at a time. We were spending about six and half hours in the morning and at night because of the design.

“Our accommodation Anthony Kiff you could say had eczema because the house was not maintained and was run down. But after a year they got things back to a good standard.”

Each paddock had only one water trough, now there are two, Kiff says. These upgrades have made a huge difference for him and his staff.

“With the better facilities I’m able to upskill and educate my staff.

“That’s been the biggest bonus for me personally – spending time with the staff and teaching them new skills and not making them into glorified milkers.”

Kiff is a local lad who first worked for Alan Wills, the local Federated Farmers president and a highly respected dairy farmer. Kiff credits Wills with teaching him a lot of the skills he has today, which he is now passing on to his staff.

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12 // NEWS

One eye on the night sky, the other on his beloved herd RICHARD COSGROVE

MANY DAIRY farmers

might recently have been looking into the night skies for stellar inspiration.

That’s just where one North Canterbury dairy farmer goes to relax after a hard day on the farm.

Oxford dairy farmer Stu Parker has 250 cows on his 95ha property, and he has a backyard observatory where he searches the sky looking for Supernovas.

Parker is a part of BOSS -- the Backyard Observatory Supernova Search -and to say he’s good at is

an understatement: he’s only the sixth amateur in the world to have discovered a hundred supernovas, and he’s still searching -- the current tally exceeds 120.

His wife Lynn describes him as a part-time farmer and a professional astronomer, but it wasn’t always this way.

Dairy News had originally contacted Parker to get his opinion on a Lincoln University study saying small herd dairy farmers were generally happy with their lot.

Parker had been a large herd farmer in Southland, then he shifted back to North Canterbury to a

small herd six years ago.

In Southland the Parkers milked 700 cows as contract sharemilkers as well as milking 250 cows on their own farm some distance away. It was full on, Stu racking up 35,000km one year driving between the farms.

At one stage they realised they hadn’t had a day off in three years and Lynn hadn’t left their farm in nine weeks.

After some family members died, the Parkers realised you couldn’t put a price on your sanity and they moved to North Canterbury.

On bare land near Oxford they started from

scratch, rediscovering life.

Saying that he couldn’t go back to a big herd, Parker finds small herd farming more enjoyable, saying you can truly get to know your cows and have a better quality herd; the couple have excelled at pedigree breeding Friesians.

Being a member of Ambreed for 26 years, they were delighted to have a bull accepted by the firm, and they also have a stunning line of heifers coming through this year.

Saying that the scale can be difficult, he said “You can’t do anything about the payout so you have to focus on your

Oxford farmer Stu Parker with his 16-inch telescope he uses to scan the sky for supernovas.

farm and your cows; that’s where you can make a difference.”

They recounted that when they were sharemilking the payout was at one stage $3/L, of which they were getting only half.

It’s obvious the Parkers have a bond with their cows: when it’s milking time many of the cows will come over for a scratch or rub while waiting their turn in the shed.

Parker says some farmers will think he’s soft, but when recently faced with a dying cow of 16 years standing on the farm, he opted to have a vet eutha-

nase the animals and he buried her on the farm.

He asks, what’s the point of sending her off to the works and getting $500 for her when she has given many thousands of dollars to the business over those 16 years.

The Parkers have done some big farm things like centre pivot irrigation and a winter shed for the 60-odd cows they winter milk. He describes the shed as necessary for maintaining condition in the harsh snowy winters Oxford can experience.

Downsizing has allowed him to have a bit

more of a life; Parker says he’ll step back a bit when the downturn comes right.

Not wanting 100% of their focus to be on the farm is how he expanded his astronomy hobby.

Joining the supernova search has given him a new challenge. A supernova is a star at the end of its life, going out in a huge explosion whose after-effects are visible from earth.

With the discovery of his first supernova in 2009, he has gone from strength to strength, recently buying a new 16inch telescope from Italy.

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DAIRY NEWS MARCH 8, 2016

NEWS // 13

Future lies in exporting premium food – Rowarth PAM TIPA pamelat@ruralnews.co.nz

FAILING TO market

our products properly is costing us billions, says Jacqueline Rowarth, agribusiness professor at the University of Waikato.

Many of our products including dairy occupy ‘premium healthy’ categories, she says, but we are not telling that story sufficiently.

“Our farmers have traditionally been more about ‘can we sell our product?’ than ‘we can think about what the market actually wants’.

Our companies are beginning to move into it but they are taking some time,” she told an Agcarm conference in Auckland.

“Our future is in premium; we have been saying this for some time but we haven’t been targeting.”

From 2006 to 2014 the premium category in the supermarkets increased 11.3%. Studies have shown the health aspect is considered the most important by consumers -- more important than the environment.

“We know our free range, mostly pasture grown products are higher in omega 3 than the grain fed counterparts. It might be so tiny it doesn’t have

any real health benefits but nevertheless grass-fed organic is being marketed on that basis, commanding much higher premiums -- in the case of milk twice as much at the farmgate in the US for the organic factor.”

An organic cow in America only has to have access to pasture for 120 days a year.

“We are the third-lowest user of antibiotics in animals in the world., and we have good animal welfare,” she says.

‘Health’ labels include low sugar, sugar free, no artificial colours, GM-free, natural flavours, all natural and high in fibre. “But the figures I really like are that 18% of people will pay a premium for GM free or natural,” she says. New Zealand milk and kiwifruit, for instance, fit those labels.

“So there’s a whole second wave of conventional retailers demanding this natural, organic, GMO free – the emphasis is on farm to table,” she says.

Ethical food allows consumers to feel morally superior and triggers part of their brain to produce seratonin so the food tastes better. The same with eco labelled food: research has shown if you eco label a Big Mac burger but not another, the eco labelled one tastes better

even if they actually taste the same. Eco labelled water tastes better than the others.

“It’s the imagination [that counts], but what have we been doing about capturing the imagination for New Zealand products?”

Rowarth said if we go too far down any of these purity tracks we run the risk of dropping the money. This is what happened to premium and organic products during the global financial crisis. @dairy_news facebook.com/dairynews

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IT IS “daft” that Fonterra has to collect milk, as stipulated by the Dairy Industry Restructuring Act, says Rowarth.

Asked for her opinion on Fonterra versus Tatua, she said that in contrast to Fonterra, Tatua has a 19km radius and is a limited cooperative.

It is breaking its components down for added value.

“Another thing Fonterra has to do is supply milk to its competitors for their first three years.

Potty, absolutely potty, when there are so many of them and the new competitors are able to do what Tatua has done and pick up in the 12km radius or whatever,” she said.

It’s not economies of scale but economies of geography.

“Poor old Fonterra; I feel sorry for it. But it’s got the completely wrong strategy. Absolutely.

“Its strategy ‘Volume, Value and Velocity’ is not working. [It has 30 billion litres] from six [global] milk hubs, but it can’t sell the 22b L it has now at a price to cover the cost to farmers; this defeats them. But it wants to review its governance board to ensure it can lead a 30b L company.

“The money that has gone offshore and isn’t working is just appalling.”

DAIRY NEWS MARCH 8, 2016

14 // FEDERATED FARMERS DAIRY COUNCIL CONFERENCE

Subsidies keep milk flowing, defy logic SUDESH KISSUN sudeshk@ruralnews.co.nz

FEDERATED FARMERS Dairy

chairman Andrew Hoggard says subsidies and support payments to farmers are partly responsible for the shock rise in global milk production.

Hoggard told the dairy council conference in Nelson last week that these payments have the effect of insulating farmers from the realities of the world market.

Despite falling milk

prices, global milk production remains strong, particularly in parts of Europe; the extra milk is not helping arrest the decline in prices.

Normally, when milk prices drop, farmers cut back production and the drop in supply triggers a price recovery.

However, Hoggard says last year milk production in parts of the world increased substantially.

“The law of supply and demand isn’t some contentious theory that is much debated; there is no debate. It’s straightforward: if you

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               

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

 

want higher prices either supply needs to decrease or demand needs to increase, and demand certainly won’t increase by filling supermarket carparks with cowshit.”

Hoggard points out that Euro 850 million in subsidies is being paid to dairy farmers, as reported by the European Commission.

“These production linked subsidies are particularly for those on marginal land, or in areas where dairy is at an economic disadvantage to other land-use types.

Yes, apparently if you live in a region where there are higher value uses for your land for, you can get a subsidy to stay dairy farming rather than switch to the higher value land use. Surely this should be the first production to drop by the wayside in the current environment.”

“When, however, 42% of your income comes from support payments, the reality is it influences your decisions and enables you to make different decisions than you would otherwise make. The current increase in supply flies completely against economic logic.”

Hoggard says the current downturn is cyclical and structural.

Federated Farmers Dairy chairman Andrew Hoggard (left) and primary production select committee chair Ian McKelvie at the conference.

“The current downturn started due to a standard cyclical event -- low demand from one market, China, together with high levels of supply worldwide. It was then compounded by another cyclical event -- the geopolitical market shock

of the Russian ban on food imports; but holding us down is the underlying structural issue with the global dairy market, i.e. dairy is a highly protected product.”

Only 13% of global dairy consumption is accessible to New Zealand

dairy exporters at tariffs below 10%. These barriers mean only a small volume of global dairy production is traded, Hoggard says.

“Put simply, the liquidity of the global dairy market is constrained, making it more prone to volatility.

And this volatility is then compounded by some large developed country milk producers continuing to use subsidies and supports to shift price risk from their farmers and into the international market -- the market that sets the milk price.”

TRACTOR-DRIVING BENEFICIARIES ANDREW HOGGARD says claims that New Zealand dairy farmers are subsidised are false.

He says detractors of the dairy industry like to claim we are subsidised because of the negative externalities of our industry.

“To them I point out that in Europe those farmers get support payments for environmental issues whereas NZ farmers meet the full cost of those initiatives; the joint Federated Farmers – DairyNZ survey found that in the last

decade NZ farmers had [spent about] $1 billion in environmental initiatives.

“People may also point to the irrigation fund as a subsidy.

But when you have to pay it back it’s called a loan not a subsidy.”

Hoggard says he has seen plenty of other comments that NZ increased its production during the last decade, so why can’t others?

“Yes, we increased our production but we did so based on the economic reality. The market, through increased prices,

said it wanted more dairy, so we responded with increased production. Right now the market is saying the opposite, and at this stage we have responded and our production is down -- though with all this rain many of you... have received we may not be down by as much as predicted.

“If Europe wants to have a social welfare system for tractor driving beneficiaries that’s its business but it becomes our business when that system has distorting and negative effects on world trade.”

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DAIRY NEWS MARCH 8, 2016

FEDERATED FARMERS DAIRY COUNCIL CONFERENCE // 15

Fonterra told to lift its game on communication FONTERRA HAS been

told to improve its communication with farmer shareholders.

Federated Farmers Dairy chairman Andrew Hoggard told its council conference in Nelson last month that the industry needs to better brand the New Zealand story.

“Our companies need to continue to look to add value, but also better explain how they are doing it,” he says. “At times Fonterra fills me with hope, and then fills me with doubt. Its communication to farmers on what it is doing, and why, needs to improve dramatically.”

Hoggard says competition for dairy in the global market is getting stronger.

The CAP reforms were aimed at rebalancing in Europe as production moved to the ‘green belt’ -- to countries such as Ireland. If that occurs, Europe will become more competitive, even without support, and more innova-

tive, Hoggard says.

“When your average herd size is only ten cows, to lift production by 10% only equates to one cow, and there is a very low marginal cost to that.

“So even if we had a level playing field, Europe and others could well be tougher competitors than they are now. It means our industry needs to get smarter. We have rested on our laurels to the extent that consumers automatically associate NZ products with high standards and safe food.

As mentioned, farmers in NZ have invested heavily in environmental initiatives and animal welfare, and there is a good story to tell on climate change and many other matters.”

Another issue facing the industry is the impact of dairying on water quality.

“As an industry we need to keep working to improve that, and if farming practices were to

emerge upstream of me that would put the water quality at risk I would be the first to rally against that, because being able to take my kids playing in the river is important to me.

“But this debate gets hysterical at times, with claims that our rivers

are ruined and you can’t swim in any of them. This is plainly not true. It gets me livid that in any media mention of the Manawatu River they always say “reportedly the worst in the western world” – a false report repeated by the news media.”

Federated Farmers Dairy vice chairman Chris Lewis (left), Wayne Langford, Golden Bay and Graeme Mackenzie, Southland at the conference.

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DAIRY NEWS MARCH 8, 2016

16 // NEWS

Young Maori go-getter ‘keeping it humble’ THE KEY to getting ahead in dairy-

ing, says Tangaroa Walker, is to seize every opportunity and find ways to stand out.

He got this advice early in his career and he’s now passing it on to other aspiring young farmers.

Aged only 26, Walker is a wellrespected future leader, having won the inaugural Ahuwhenua Young Maori Farmer Award and the Southland Primary ITO Trainee of the Year in 2012. Entries for this year’s Ahuwhenua competition closed last month.

Walker has agreed to mentor Genesis Raroa, a fellow Southlander who wants to move into farm management.

Primary ITO has facilitated the mentoring arrangement and Walker says he’s looking forward to passing on his knowledge and giving Genesis moral support.

“Winning that competition fasttracked my career by three years at

least. It’s opened up a lot of opportunities for me and I’m looking forward to helping someone else through the process so they can achieve their own goals.”

Walker, who began milking cows at age 13, says the dairy industry needs more Maori leaders.

“My advice to any Ahuwhenua entrant is that it’s our responsibility, as Maori, to take the opportunities that are out there. We need to be in a position where we can run our own farms and be good role models in business.

“The key to being successful in the dairy industry is to focus on the goals ahead. It can be a struggle moving from a farmhand, to 2IC, then into farm management. It’s tough. You do a lot of work for not much money.

But if you have the goal of becoming a contract milker or sharemilker and keep focussed on that, you will get there.”

Walker was offered his dream con-

Tangaroa Walker

tract milking job within a week of winning the Ahuwhenua award. This has opened many other doors for him – invitations to speak at schools and on farms and to take part in industry organisations.

“Entering Ahuwhenua opened my eyes. I got to meet so many inspiring successful Maori, a lot of whom I’m still in touch with and working with today. I felt very comfort-

able throughout the Ahuwhenua interview. I felt like I could deliver the information to the judges and no-one was looking down on me.”

Walker was recently invited to a KPMG forum for future leaders in the primary sector where participants were asked to develop a vision for 2025. He is also a member of Primary ITO’s dairy industry partnership group helping to shape the future of the industry.

“Plus I’m a member of Venture Southland’s youth taskforce to try to encourage more youngsters to enter the dairy industry.”

Walker believes pushing himself and standing out is the key to getting ahead. And he has more goals.

“I try to keep it humble. I don’t think of myself as a role model yet.

I’m looking forward to sitting down with Genesis to help him work out his goals, and to pass on some tips about the Ahuwhenua interview process to help him on his way.”

Fonterra to close plant FONTERRA IS closing its Kaikoura site with 22 jobs set to go.

Mark Leslie, Director New Zealand Manufacturing, says Fonterra will be discussing the proposal over the coming weeks with the employees, with a decision expected mid-March.

“This is a difficult process for our people and supporting them is our priority as we work through the details,” says Leslie.

“We will be discussing all options and opportunities available to our staff around their future employment, as well as providing the support they need to make decisions should the closure go ahead.”

Fonterra Kaikoura employs 22 full time staff and typically operates between three to five months a year producing a small volume of specialty cheese. Moving this production to other sites would bring significant cost savings for the business and its 10,500 farmer shareholders.

“The proposal to close the Kaikoura site has not been made lightly and is one intended to help generate cost savings for the benefit of all Fonterra farmer shareholders,” says Leslie.

Check out our websites BREAKING NEWS MANAGEMENT STORIES MARKETS & TRENDS MACHINERY REVIEWS COMPETITIONS AND MUCH MORE...

www.dairynews.co.nz

DAIRY NEWS MARCH 8, 2016

WORLD // 17

Quad safety devices face backlash MARK DANIEL markd@ruralnews.co.nz

QUAD CRASH injuries

and deaths in Australia have prompted Worksafe Victoria (WV) to push the use of crush prevention devices (CPDs), but there’s a howl of protest.

WV has declared that crush prevention devices (CPDs) are a good way to mitigate injury in a rollover, and they want employers to fit them if rollover risk is high.

Interestingly, with no law in place requiring CPD use, Worksafe says it will consult for 12-18 months, encouraging employers to fit such a device to mitigate risk of prosecution in the event of an accident.

But this stance is at odds with quad manufacturers who cite extensive research, including accident modelling for 20 years, that indicate that CPD’s are largely ineffective in saving riders from death or injury, and sometimes do more damage than they set out to prevent.

The quad makers also say that 99.6% of Australia’s 350,000 quads are ridden without incident, and though the 15 quad deaths in 2015 are regrettable, they are a tiny percentage of the problem.

They want to see more emphasis on rider training, to ensure operators understand the abilities and limitations of quads, and that quads need more rider ‘input’ than other vehicles.

They also accept that a quad will not always be the best vehicle for a particular job, or difficult terrain; instead side-by-side vehicles may be better.

These offer the protection of seatbelts and a safety structure over the passengers, features impossible on a quad.

Speaking to Dairy News, Worksafe NZ acknowledged Worksafe Victoria’s stance on CPDs and the conflicting views of the quad makers. “We’re waiting for more detail and the empirical evidence before commenting,” a spokesperson said.

NZ Motor Industry

Co-op opens demo farm FONTERRA HAS opened a demonstration and

training farm in Sri Lanka.

The farm is part of the co-op’s dairy development programme which supports the growth of sustainable dairy industries in key markets where Fonterra operates.

Prime Minister John Key, Sri Lankan Minister of Sustainable Development & Wildlife Gamini Jayawickrama Perera, and Fonterra chairman John Wilson were guests at the opening.

Sri Lankan dairy farms are typically small, producing around 20L per farm per day; imports fill the supply gap. Anchor is the leading milk powder brand in Sri Lanka and Fonterra collects local milk for its branded business there; most milk is made from powder imported from New Zealand.

Fonterra chairman John Wilson says Fonterra and Anchor have a long history in Sri Lanka.

“Our work to strengthen the Sri Lankan dairy industry helps local dairy communities and it allows us to support the growth of local dairy consumption and continue building our presence in this key market.”

The farm will help Sri Lankan farmers improve milk quality and run their farming businesses more efficiently and profitably.

The demonstration and training farm will train around 2500 small-holder, subsistence farmers every year, sharing the cooperative’s dairy farming knowledge through farmer visits, field days, short course training and apprenticeships.

Association chief executive David Crawford says WV’s proposals are at odds with the reliable science, and that they conflict with recent coroners’ inquests in Queensland and NSW: the coroners

had found insufficient evidence to recommend the use of CPDs, and they suggested that more time and effort should be spent on proving CPDs’ effectiveness.

Crawford says good

operator training, good quality safety gear including helmets, keeping children off adult sized machines and allowing only solo riders on singleseaters would best tackle the safety problem.

Quad bike safety devices are not going down well in Victoria, Australia.

DAIRY NEWS MARCH 8, 2016

18 // OPINION RUMINATING

EDITORIAL

What’s our problem with the Chinese?

MILKING IT...

Toying with a new brand

THERE WAS collective shuffling of feet and eyes downward when Arowhenua marae kaumatua Tawera King warned people not to throw anything at Minister Steven Joyce while he was opening Fonterra’s Mozzarella plant at Clandeboye.

King said since he would be standing next to Joyce he didn’t want to get hit and be be called a dickhead. Joyce was hit on the face with a dildo hurled by a protester at Waitangi Day. Much to the relief of those attending, Minister Joyce took it in his stride, saying with a smile that he had been “doing his best to market New Zealand globally lately” but he “needed some work on his brand message”.

Politicians eye the main chance

NORMALLY THE Northland Field Days are a low key affair, visited by the Primary Industries Minister and an occasional politician.

But last week, it was different: Science and Innovation Minister and National Party strategist Steven Joyce popped in.

So did Opposition leader Andrew Little and Northland’s sitting MP Winston Peters.

With a general election looming next year, National will be keen to wrest the seat back from Peters.

Fit to breed better

FITNESS TRACKER devices have a worldwide following; now there’s one for cows, by the Japan tech giant Fujitsu, to boost their breeding efficiency.

The estrus detection system for cattle (EDSC) determines exactly when cows are biologically primed for artificial insemination, reports Digital Trends.

Smarter breeding and birthing are the aims.

They consist of a wearable cattle pedometer and a stationary receiver to process tracked data.

The data collected by the receiver is sent to the Microsoft Azure cloud, from where EDSC automatically sends the feedback to a computer or laptop. This gives cattle owners access to loads of valuable information about the livestock, such as timing for early conception and predicted due dates.

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No truck with Trump

US DAIRY farmers are being caught up in the US primaries.

Building a wall on the border with Mexico and deporting all undocumented immigrants has become an applause line at Donald Trump’s rallies and the main policy idea for the GOP front-runner.

But Trump’s promise has sparked fear and frustration among farmers who, like it or not, depend on immigrant labor.

“I’m angry,” says dairy farmer Mike McMahon, who owns 700 cows in upstate New York, now the third-largest dairy producing state and the biggest producer of Greek-style yogurt in the country.

“For someone like Trump or Cruz to say they are going to send them all back is short-sighted because so much of our food supply is dependent on their labor,” he says.

IT WAS good to see Shanghai Pengxin open its doors last week and invite dairy industry leaders to hear what the Chinese company has done with the former Crafar farms and to see some of the changes on two of them.

Shanghai Pengxin has been vilified over the years for its strategy of buying farms in New Zealand.

They rightly question the rules and decisions governing the purchase of NZ land and imply the Chinese are treated differently from other nationalities who also buy NZ farms.

Some critics of Chinese land buying pose the question, since Kiwis are prohibited from buying land in China why should Chinese nationals be allowed to buy land here?Maybe there is some validity to that, but would a long term leasing arrangement address this issue?

Some Kiwis seem to think the Chinese, in particular Shanghai Pengxin, will somehow take over Aotearoa, making us tenants in our own country. The critics fear something insidious in China’s buying ‘spree’.

But we don’t hear of such angst when a wealthy opptortunist Israeli, Australian, Brit or American buys a bit of NZ. With Donald Trump attracting huge support in the US presidential race one has to wonder whether NZ has more to fear from the US than from China.

In fact, Shanghai Pengxin has done a lot of good for the NZ dairy industry. It has brought up to standard 16 dairy farms that clearly needed massive cash injection. $20 million has been spent on the farms and that money has gone to local suppliers. Surely that’s good news.

Shanghai Pengxin has worked well with its joint venture partner Landcorp to manage these farms to achieve their potential. And they have entered another joint venture with the Maori dairy company Miraka to produce UHT milk for the Chinese market.

This has created many well paid jobs for NZers.

As part of its deal with the OIO, Shanghai Pengxin last week opened a $1 million academy to train future leaders.

The programme is fully funded by Pengxin NZ Farm Management so attendance is free for all participating students; it will also award annual ‘Theland’ scholarships worth $10,000 Shanghai Pengxin can rightly feel aggrieved at the way it is sometimes dismissed as being bad for NZ. The reality is quite the opposite and perhaps the critics need to get out of their glasshouses in the cities and see the reality in the country.

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DAIRY NEWS MARCH 8, 2016

OPINION // 19

Bulk, boutique go together Fonterra Australia commercial director Abhy Maharaj recently addressed the Australian Dairy Conference in Victoria. Here are excerpts from his speech.

say it’s been a challenging season.

We’ve seen a fundamental imbalance in global supply and demand, driven by the lifting of production quotas in Europe and ongoing Russian trade sanctions, pushing more product onto the market.

The Middle East was a major destination for cheese, but imports have fallen this season because of low oil prices.

China’s economy has softened, and last year global dairy prices hit their lowest levels in over a decade.

Locally, a prolonged El Nino has seen Australia enter a period of drought, and as production costs have increased, milk collection has dropped.

At Fonterra Australia we’ve encountered challenges with a fire at our Stanhope plant in December 2014.

Milk that would ordinarily be going into high value cheese is instead going into skim milk powder.

The key to tackling these challenges is having the right strategy. Rather than trying to do it all, processors need to focus on their strengths.

Fonterra has global scale, and we are able to leverage that scale to focus on areas where we have a comparative advantage.

In New Zealand, we can produce commodity powders more efficiently than anywhere else in the world. A number of our NZ sites are capable of producing at least 1000 tonnes of powders every day.

Compare this with our largest powder site in Australia, Darnum, which can produce a maximum of 300 tonnes of powder a day running at full capacity.

There is no sense in replicating what we have in NZ here in Australia.

We need to focus on our strengths, which is why our focus is on higher value-added products – cheese, whey and nutritionals, complementing our retail and foodservice businesses.

Milk costs more to

make in Australia, so we need to squeeze value out of every drop to generate sustainable returns.

Cheese, whey, and nutritionals deliver on that investment. We can make these products efficiently, and generate a higher return.

Our A$120 million investment to rebuild our cheese capability at Stanhope is central to this strategy.

Whey and skim from cheese production will go into our nutritionals at Darnum and Dennington, so we won’t be wasting a drop.

It will complement our consumer retail and foodservice businesses, with the fats from milk production at Cobden going into Western Star butter.

The Australian market is ideally placed to concentrate on value-added products; however it doesn’t mean focussing exclusively on boutique products and ignoring bulk.

Bulk to boutique is not an either/or prospect. We can leverage our presence in bulk to expand into boutique, de-risking our investment.

On the bulk side, Fonterra’s joint venture between our Darnum site and Chinese food manufacturer Beingmate connects us to 80,000 points of sale in China.

Beingmate is one of China’s largest infant formula companies, and we’ve bought a 20% stake in the business, setting up a distribution channel that will reach millions of Chinese families. It allows us to reach Chinese consumers directly and efficiently, delivering a high-value, high-quality product.

We’ve been able to parlay that into the boutique.

We’ve made an agreement with boutique infant formula producer Bellamy’s Organic, utilising our manufacturing expertise to create their premium product. Because we can do bulk and do it well, it gave Bellamy’s the confidence that we could deliver on boutique.

We’ve just launched Anchor Milk into Australia – it’s a boutique product

aimed at the more discerning milk drinker.

We know Australia is a crowded marketplace for milk, with over a dozen brands on the market.

We’re all looking for that edge to differentiate our-

B&DEL0026B

IT’S NO exaggeration to

selves from every other milk in the dairy case.

Anchor uses microfiltration to create a superior fresh taste, with a longer shelf-life, and is a first for the Australian market.

Anchor complements the milk we’re processing on behalf of Woolworths for their private label.

Boutique is not the

delaval.co.nz

panacea for current global dairy challenges – at least, not on its own.

It has a place in the market, but to be globally relevant, we need to have the bulk as well as the boutique.

For companies like Fonterra, bulk is our bread and butter, but boutique is the cream on top.

Abhy Maharaj

DAIRY NEWS MARCH 8, 2016

20 // AGRIBUSINESS

Strong governance critical to success LEADERSHIP THROUGH strong gover-

nance is critical for farmers, and the sector more broadly, if the dairy industry is to seize the opportunities of the decades ahead.

That was the message from Rabobank director and former Fonterra chair Sir Henry van der Heyden to the delegates at this year’s Australian Dairy Conference.

A fourth generation dairy farmer, van der Heyden and his wife started out as a sharefarmers and have grown the business to have dairy investments in New Zealand’s North and South Islands, and in the US and South America.

“Governance is about creating shareholder value through growth,” he said.

“I’m only involved in businesses where I can pull that lever for growth; it’s an important part of the value creation chain.”

Van der Heyden says the Australian and NZ dairy industries can no longer rest on their natural advantages, and though there are huge opportunities the landscape is highly competitive.

“Consumers want a Rolls Royce but only want to pay for a Skoda,” he says. “We have to deliver more and more, cheaper and cheaper and at the same time try to create value.

“We are being squeezed: we cannot stand still, we cannot do the same... We have to produce more, produce it better, at a higher quality, with lower inputs of time,

resources and costs.”

He said leadership, including at farm level, was the key to meeting this challenge. “The first part of successful leadership is lifting governance,” he said.

Sound business management, and accountability to a board, was important if farm businesses were to maximise value and grow.

“Having a board and a three-five year plan keeps the banks happy and can save money and minimise risk.”

He said a board should be made up of people already successful and truly able to challenge what you are doing onfarm.

“You need people at a strategic level to bring their knowledge and experience to the business. It may be monthly, it may only be quarterly, but this can give you ideas, energy and momentum to drive your business.”

He said boards could add value by looking to the bigger picture and focussing on business objectives; separating governance from representation is the key.

“There’s always a blur when you sit on a cooperative board: are you there as a governor or are you there representing farmers?

“One of the best innovations when we formed Fonterra was to separate those two roles. So much value got created in that separation alone.

“When you are on the board as a governor your focus has to be much more on the global marketplace,

WINNING RECIPE ON STRONG GOVERNANCE ■■

An annual budget you own

■■

Report against your budget at least quarterly

■■

A 3-5 year business plan (strategic goals, what does it look like)

■■

A succession plan

■■

Some form of governance (board) over your business.

■■

On leadership: A vision and a strategy

■■

A robust governance framework in place

■■

Understand the end customer

■■

Set out new ideas and innovations. Learn from others

■■

Use technology to help reduce input costs.

while the shareholder councillors represent the voice of the farmers.”

He says diversity of opinion, background, age and gender were also critical to creating successful leadership. “You cannot dismiss capability, but

gender and diversity are very important.”

Van der Heyden also highlighted Rabobank’s executive development programme as a valuable tool for farmers to develop their business management skills.

Former Fonterra chairman Henry van der Heyden spoke at the Australian Dairy Conference last month.

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DAIRY NEWS MARCH 8, 2016

AGRIBUSINESS // 21

Change dairy systems to lift returns BY 2025 the New Zealand dairy industry could be emitting 25% less greenhouse gases, 40% fewer pathogens and nitrogen, and earning 60-100% more profit. It will be an industry that can pride itself on being the “farmers’ market for the global village”.

This is the hope held by

veterinarian and agri-ecology consultant Dr Alison Dewes, and she gave delegates at a recent seminar sponsored by Sollus NZ an insight into the challenges the industry faces in achieving that.

Drawing upon her experience as a farmer, veterinarian and consulting expert witness for

regional councils, Dewes said the dairy industry had to ask itself how much more it could intensify.

She pointed to predictions that schemes such as the Central Plains Water irrigation scheme in Canterbury would result in a 29% increase in nitrogen in waterways. Thirty percent of the region’s shal-

low wells had already experienced an increase in nitrogen and pathogen levels within 10-15 years of irrigation on shallow lighter soils.

“And out of 99 sites monitored in Canterbury, 42% show the presence of faecal material and are classed as risky for swimming.”

However she also cautioned there is a risk things will get worse before they get better. She pointed to a proposed government review of water quality standards that could see the ‘bottom line’ level of coliform in water increase 400%.

There was also growing conflict between estab-

al sulphur and lime in one granule that grows more pasture both and by being retained in the soil over winter the fine elemental owth.

growth on the shoulders Ballance Nutrient Specialist, isit sustaingain.co.nz

Contains SustaiN

lished long term farmers in Waikato who may have to reduce their nitrogen losses by 30% where thousands of hectares of new pine to dairy conversions continue to occur. This was to counter the additional 30,000ha of converted land that has come on-stream Vet Dr Alison Dewes in the last few years, and that was in addition to the 29,000ha conwater quality, and said he verted between 2003-12. believed NZ dairying could Dewes says farmers grow for the next 10 years were receiving mixed mes- by 2-3% a year. sages from Government Dewes anticipates and councils on how to future efficiency meamanage nitrogen reducsurements were likely to tions. As the subject of see farm production meaNZ’s first nutrient mitiga- sured in kgMS/ha versus tion scheme, Lake Taupo kg of nitrogen leached. had used ‘grand-parentShe has worked with ing’ of rights to nitrogen farmers achieving a 6-8% losses. But this was a very return on investment who defined catchment. are only losing 20-25kg “And such an approach nitrogen/ha, against the tends to reward polluters Waikato average of 40kg/ and penalise innovators. ha.

It is not a fair way to allo“We have a lot of farm cate polluter rights, and systems running 20% or regional councils are weak more cows than optimal.” at enforcing them.”

This meant the average She urged farmers to 350 cow dairy farm could push harder for greater lose 80-100 cows immeinvestment in Overseer, diately. the only tool available at “But this will be unique present capable of calcuto each farm, so needs lating nutrient losses. considered marginal “Given our national analysis that balances reliance upon it, the realresources, capability and ity is it needs significant cows. investment and increased “We are starting to transparency as to how it see two herds develop on works, now.” farms, a marginal herd – where costs to run those She pointed to some cows costs more than they regions showing promreturn -- and a profitable ising signs in developing herd that is sustained by realistic means of managthe natural capability of ing nutrient losses. This the system.” included Hawke’s Bay Changes to make NZ region, using land use clasdairying the first stop for sification for determining acceptable nutrient losses higher value boutique consumers would revolve within a farm’s boundararound a lower intensity ies. system.

Given how hard much “It is likely we will of lowland NZ’s pastosee more varied forages, ral systems were already including assorted herbs working, Dewes chaland grass alternatives to lenged Fonterra’s chief ryegrass, enhancing more executive Theo Spierings, productive/profitable who insists that NZ has cows in an optimal state of the potential to continue wellbeing to ensure more expanding over the next milk from fewer cows. decade.

“We could also have Spieirings stated in more calves reared for October 2014 that 60% alternative revenue, less of expansion would be support land required, unbased on conversions and productive land retired, more cows, and 40% on coupled with closed loop more productivity. He nutrient cycles, coupled disagreed with the Enviwith pathogen [bug] loads ronment Commissionintercepted before they er’s comments that more reach waterways.” dairying means a drop in

DAIRY NEWS MARCH 8, 2016

22 // MANAGEMENT

Low-cost winter or spring f PAM TIPA pamela@ruralnews.co.nz

THE APPLICATION

of Gibberellic acid, particularly in winter or spring, is a good way to produce low cost feed in a hurry, a Northland study has shown.

However, count on there being a ‘post Gib’ depression period during which you lose some or all of what you gain. But you can work around that to get the boost when you need it, say a scientist and a farmer involved in the study.

The onfarm benefits of using Gibberellic acid (GA) were greater than the trial results really showed (see sidebar),

said Kerry Chestnut, a NARF (Northland Agricultural Research Farm) representative and local farmer. He was speaking at the Northland Dairy Development Trust annual meeting.

Chris Boom, the NARF science manager, said GA is a tool for growing extra grass in winter and spring. They had used GA at the NARF farm for some years and there have been questions about its value, responses and when best to apply it. The questions were “just sitting there” so they initiated trial work.

“GA is a growth hormone that occurs naturally in plants. By applying it we are tricking the plant into thinking it should go into a high

TRIAL RESULTS ❱❱ Reliable initial responses to Gib in all application periods ❱❱ Low cost feed in a hurry ❱❱ Most or all of that response is lost in the post Gib depression ❱❱ Repeat applications delay that post Gib depression ❱❱ July gave the greatest single response. ❱❱ The greatest overall response was when they gave two applications – in July and September.

growth phase,” he said.

“It increases the growth rate for a short period and it is a low cost product. When this product first came out back in the 1950s and 60s and 70s it was expensive.

Now it is very low cost -$13/ha for the product. You then have to apply it.” The extra cost depends on how you apply it and what you mix it with.

“We were asking questions about the responses on Northland pastures…. when are we best to apply it?what about multiple applications?

Most of the research work had been on single applications and very little on multiple applications.”

All other research work had been done further south, not in Northland.

NARF did two trials – 2014 and last year. In the 2014 trial they found GA responds best when applied with nitrogen. If you are applying GA on its own without nitrogen you are likely to deplete the nitrogen reserves and they observed a massive post GA depression.

They tried it with both granular and liquid nitrogen and found no difference in response, so concluded you just use

whatever suits best. They found that July application of GA gives the best response. Responses on multiple applications were unreliable.

In the trial in winter 2015, treatments were replicated five times.

There was a control treatment with no nitrogen and no GA applied at all. They applied another control treatment where nitrogen alone was applied five times from July to October.

The GA plots had

Farmer and NARF representative Kerry Chestnut.

A TOOL FOR MORE FARMS WITH GIBBERELLIC acid (GA) grass can be grown for 2-3c/kgDM and there is no product anywhere available to farmers that comes close to that, says Kerry Chestnut.

While GA will usually have a post-Gib depression period, it can be applied strategically at peak periods when it will have least overall effect.

Meanwhile you can boost growth when you most need it, in winter or early spring, Chestnut said.

“I have looked at my farm: how I can grow grass with this and try to avoid this post GA depression and try to get the most out of this product,” he said.

Often at the start of winter he did not have enough grass.

“In June we’re looking at 2100kg average pasture cover. We’re 300kg short of our target. If we put one application of GA with our nitrogen, we have seen with our trial work that will grow us an extra 500kg of grass. If we just did half the farm that would be 250kg; that gets us up

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to 2350kg, or [an extra] 500kg gets us up to 2600kg.

“So it has a huge impact of increasing feed cover. What we’ve heard from our responses is over the next two-three months we lose much or all of the extra grass that we’ve grown from the GA. But if we’re short of feed cover at the beginning of winter, we need to get our average cover up. It is one product that can do that; wet or dry it just seems the grass jumps out of the ground and it seems to work really well.”

At the NARF farm they are measuring growth on plots. But Chestnut believes there are a lot more benefits to GA than just growing extra feed then losing it two months later.

“If you grow more pasture at an initial cost 2-3c through July-September you come to post GA depression in October and November.

“If we grow 200-300kg less grass through this period and take some pasture cover off the peak, does that really matter? Most farms have surplus grass at that time, silage is good for summer but it is also difficult to manage at times as well.

“Remember this feed is 2-3c/kgDM; multiple applications will lift that cost a little but you are still only looking at 6-7c so it is incredibly cheap feed.”

Through late June-July paddocks can be slightly overgrazed and a little pugged, down to that 1100-1300kg and take forever to come away again, Chestnut said.

In three-four weeks they hardly grow at all – maybe 5-10kg a day. With the GA, four-five days after application it “just seems to jump the pasture out and gets it going. It has a huge impact”.

“What I have seen onfarm is that we are achieving far better results than on the plots at NARF,” he said.

This coming winter they will look at application rates. In the past they have said they needed 50-100L of water so they needed a tractor and spray unit or a trailer behind a quad to apply the GA. In Northland wet soils and paddocks that can be a problem. It has been a big hindrance to the more wholesale use of GA. “There’s been anecdotal evidence from Waikato that they are putting it on with motorbikes now at rates as low as 20L/ha.

“We will do some work this winter because if it can be put on with a motorbike at low rates that makes it a tool for more farms.”

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DAIRY NEWS MARCH 8, 2016

MANAGEMENT // 23

g feed in a hurry response; they gave another application, had another response to GA and they lost some of that again. This treatment grew about 500kg more feed overall with the GA compared to the nitrogenonly treatment over the whole period.

Looking at three applications in July, August and September – the initial response was great, and the second and third applications delayed the post Gib depressions. The post Gib depression didn’t occur until October.

applications at different times and a different number of times but all had the same nitrogen on them.

All the GA treatments included a high regime of nitrogen inputs. They had three different application months (July, August and September) and a combination of those three months, and one which was three application times – July, August and September.

The plot trials last year were run on relatively young ryegrass pasture at NARF. A boom occurred where they applied nitrogen to the nitrogenonly plot – they grew a heap more grass in response. There was almost 3 tonnes of extra feed on the nitrogentreated plot over the winter-spring compared to the control-treatment plot.

All the GA treatments were compared against the nitrogen-only treatment.

When GA was applied in July we got an immediate response of 600kg DM, Boom says.

“We harvested 600kg at the next harvest which was four weeks after application. That is pretty massive – that’s our initial response. In the next harvest period we had a post-GA depression – a lower rate of pasture growth on our GA treatment than we had on

nitrogen treatment. This is what we call our ‘post-Gib depression’.

“We got a massive response to GA then we lost some of that DM in our post GA period – about half.”

With the August application they had a 400kg DM response to GA and lost all that in the post-Gib period. In September they got a 450kg response and lost some of that.

“We found reliable immediate responses of 400-600kg DM for each Gib application; if you look at that alone it is a very low cost DM – 2-3c/kgDM plus application costs. But some of that response, if not all of it, we lost again in the post GA depression period.”

Multiple applications were made in July and August (July response was 600kg) and if they applied a second application in August it offset the post Gib period. The July-only application had dropped below the nitrogenonly treatment during September. A second application delayed the post-Gib depression into October.

The same thing happened when they applied it in July and September (applications were eight weeks apart): they got a good response from the July application but post Gib depression depleted some of that

B&DEL0026D

NARF science manager Chris Boom.

delaval.co.nz

Gibberellic acid is a tool for growing extra grass in winter and spring.

DAIRY NEWS MARCH 8, 2016

24 // MANAGEMENT

Summer threatens spread of yellow bristle grass THIS SEASON is a

peak time for farm-tofarm spread of the pest plant yellow bristle grass.

Waikato Regional Council advises preventing its spread by avoiding grazing stock or making hay from vegetation growing on roadside verges.

“Bristle grass can take over farm paddocks and damage the profitability of dairying, so avoiding its spread will help support productivity,” says pest plants officer Darion Embling.

Yellow bristle grass is a summer-growing plant with distinctive, cylindrical seedheads with many yellowtinged bristles.

Seeds can spread

along roadsides via mowers and other mechanical means, and in freshly chopped maize silage being moved around. If it takes hold on the roadside it can quickly move into farm land, says Embling.

“Yellow bristle grass seeds also pass through animals after being eaten and is spread around farm in dung.”

Studies have shown that dairy farms infested by the plant can lose 13% of dry matter production.

Embling says to help stop the spread of yellow bristle grass: ■■ Ensure all imported maize chopped for silage gets into the pit and that loose

Yellow bristle grass.

■■

debris is not spread along the access way and into adjacent pasture Inspect all incoming hay and machinery unless the source is known to be free of

■■

■■

yellow bristle grass Restrict the feedout of infested hay to areas where yellow bristle grass can be readily controlled Check that stock being brought in

from outside the farm during summer have not grazed yellow bristle grass infested pasture. www.dairynz.co.nz/ feed/pasture/pests/yellowbristle-grass/

Focus on heifers A HEIFER rearing field day in Central Hawke’s Bay next week will provide farmers and graziers with information to help ensure young stock continue to meet target weights through the summer and autumn.

The field day on March 15 will be held at Craig and Graham Anderson’s farm near Waipukurau. The Andersons run a mixed business with heifers, winter cows, cropping, hogget grazing and some beef across four blocks totalling 1600ha.

DairyNZ consulting officer Scott Cameron says the field day will focus on helping farmers manage through dry periods with a view to setting up for next season.

“Summer can be quite extreme in Central Hawke’s Bay. The timing and location of the field day was planned so farmers can see how the Anderson’s manage through dry weather,” says Cameron.

“Autumn is often the most challenging season to grow

heifers due to low pasture growth rates and peak animal demand. To cover all bases we’ll look at ‘what-if’ scenarios and strategies that can be put in place to ensure target weights that are set out in grazing contracts are met.

“The Andersons run 1200 heifers and 820 weaners with no irrigation, so careful planning is needed to reduce the impact of summer dry – that plan will be discussed at the field day.”

Cameron says as well as talking through the Anderson’s plans, the field day will provide an update on the region’s heifer grazing focus farm near Marton, owned by Andy Stewart.

“To date we have run four field days hosted by Andy. These have covered a wide range of topics as we have tracked the animals from weaners in December through to in-calf heifers in May when they leave the farm,” he says.

A final focus farm field day will be held at Andy’s farm in May.

What’s stealing your production?

Poncho creates a halo of protection around the seed.

Experts are predicting a long dry summer.

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DAIRY NEWS MARCH 8, 2016

MANAGEMENT // 25

Winning the contest was a bonus TE PAHU farmer Noldy Rust entered a pasture competition late last year only because the organisers were looking for more entries.

As chairman of Smaller Milk and Supply Herds, he was asked at a SMASH conference to urge members to enter the pasture renewal persistence competition, run by the DairyNZ-led pasture renewal leadership group.

Rust also entered the competition and won the best pasture more than three years old, picking up $1500 of grass seeds and

they decided they needed another challenge. “We got as far as we could with system 1 so we thought of building a feed pad and importing maize.

“The idea was to lift cow numbers to 200 and gain more profit.”

In 2006 they increased stock numbers to 200 cows and bought maize silage and PKE; they also built a feed pad.

For the next five years the farm averaged 75,500kgMS -- 1466kgMS/ ha or 378kgMS/cow.

In 2011 they bought a 24ha runoff in partnership

“I told them they all have paddocks which could have won; we just happened to enter the competition and had a good paddock that lasted well for a number of reasons.” pasture renewal products.

Last month Rust hosted farmers to talk about his winning paddock, a 10-year-old mix of Alto and Arrow ryegrass.

He told Dairy News his main aim in entering was to give his new farm worker exposure to the judges.

“When the judges came to inspect our paddock I picked a good one that I knew was always growing well,” he says. “When I knew I had won, it was pretty humbling.”

Rust told farmers at the field day that he was not doing anything different from them. “I told them they all have paddocks which could have won; we just happened to enter the competition and had a good paddock that lasted well for a number of reasons.”

Rust and his wife Bev bought the 52ha eff farm in 1996. For the first 10 years they ran it as a low input system; only a small amount of baleage was bought in each year and heifers were grazed offfarm.

The farm ran 170 cows at 3.3 cows/ha and averaged 60,000kgMS, equivalent to 1165kgMS/ha or 353kgMS/cow.

Rust says after 10 years

with another farmer. This is used for growing maize silage which is brought back to the milking platform. The farm now averages 90,000kgMS with 200 cows, taking its per ha yield to 1750kgMS/ha or 450 kgMS/cow.

Despite home grown maize silage and contracted PKE making half of the total feed, pasture remains king for Rust -feed conversion efficiency utilising grass.

“We use supplements only when pasture runs out; we are not substituting grass. To do this we must have good paddocks; good pasture management requires dense sward and proper residuals. We do this with a high stocking rate, by avoiding both overgrazing and pugging.”

Rust follows a sound grazing management plan.

In the summer, morning milking is finished by 7am. Cows stay in the paddock until noon and then move to the feedpad. After they have finished at the feedpad they move to the standoff paddock under the trees.

If it is still dry and the hot months have finished, cows will stand off in next season’s maize paddocks, he says.

“As soon as the autumn

rains arrive the cows go out to a 70 day rotation for three weeks to allow average pasture cover to increase, then onto normal autumn rotation lengths.”

Te Pahu farmer Noldy Rust.

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DAIRY NEWS MARCH 8, 2016

26 // ANIMAL HEALTH

Calcium’s value boosted by supplement AN ANIMAL

manager for Dutch nutrition company DSM. These will determine how long a cow will remain in a milking herd, McGrath says.

“That comes down to calcium, the key mineral that drives the mineral bus, yet not talked about as much as it needs to be, given how cheap and

nutritionist is urging farmers to look deeper than body condition score (BCS) for a true understanding of their cows’ skeletons in assessing their health.

Factors underlying BCS must be understood, says Dr Joe McGrath, ruminant technical

easily available it is,” he says.

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hypocalcaemia, often up to 50% of a herd, that cost you. This is linked to metritis, infertility, mastitis and assorted health issues.”

A hypocalcaemic cow will typically end up in a downward health spiral, as her rumen slows down, she eats less, digests less, loses energy and has less immunity to infection and disease.

McGrath cautions while the skeleton is the cow’s reservoir for calcium, she cannot be force fed calcium to top it up, requiring instead a constant “trickle” to maintain bone health.

Published data indicate that during early lactation a cow can lose between 0.3kg-1.5kg of calcium from her bone structure.

But her ability to get optimal levels of calcium and phosphorous out of the grass is compromised by modern grazing systems where she will harvest that grass at 22-25 days of growth.

“But a grass sward’s ideal nutrient profile develops at about day 30-35 so that imbalance can’t be made up by what

she is taking in as pasture alone.”

The implications for lactating dairy cows over several years is their calcium levels will decline, ultimately resulting in them leaving the herd too soon, on grounds of health or fertility problems resulting from depressed skeletal health.

Even excess calcium can be a problem in some areas, where it reduces magnesium absorption, in turn causing hypomagnesaemia issues.

McGrath says DSM had developed a product HyD, which is a next generation form of Vitamin D which is much more efficient, enabling her to better absorb calcium in her diet.

A cow’s uptake of calcium and phosphorus from the diet can be compromised due to excess potassium, deficient magnesium or calcium and phosphorus imbalances. HyD mixed in her feed to ensure what calcium she was getting would be absorbed better thanks to HyD’s unique mode of action.

“Using HyD enables

the cow to absorb calcium and phosphorus better.

Studies have shown inserting it into their diet can double the amount of Ca retained, and reduce the amount of bone degradation post calving.”

While an additive may seem unnatural to some, McGrath said there was nothing natural about a high protein, 2-2.5 leaf rye grass plant in spring time.

HyD helped cows get through the challenges pastoral feeding presented at a stressful time for the animal.

Similarly supplements like palm kernel, grains and maize silage were also low in calcium and offered little ability to lift levels.

McGrath urged farmers to look harder at the “macro” nutrients like Ca before the “micros”, and at the value HyD can play in mobilising that valuable nutrient for health and milk production.

“Those mid-late lactation cows are in a bone building phase and robbing them of calcium means they will pay in the following lactation.”

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that cows milk off their calcium rich skeletons, just like they milk off their backs. The problem is, that loss in their skeleton is impossible to see, and difficult to measure.”

Even when she is optimally fed, a cow will be in a calcium deficit for six-nine weeks post calving, typically losing skeletal mass post calving, and regaining some of it back over the late lactation-dry period.

“If calcium is the building block of skeleton structure, then it also requires phosphorous as the ‘mortar’. Basically, you need both in order to rebuild a skeleton successfully.”

But absorption of calcium provided in her diet requires adequate levels of vitamin D, sourced from the sun.

However her vitamin D levels will be lowest over late winter spring, the same time her calcium demand is greatest, and stress levels highest.

Typically a cow’s calcium levels in her skeleton will decline over time, and as she gets older each lactation risks leaving her with lower levels.

“A dead cow costs you nothing; it is the cows that have sub-clinical

Cash support for pest killers A COROMANDEL conservation group is urging peninsula residents to take advantage of a new funding option to support individuals working independently on killing animal pests on their properties.

The Upper Coromandel Landcare Association (UCLA) is campaigning to draw attention to recent changes to Waikato Regional Council’s small-scale community initiatives fund, which is part of the council’s natural heritage programme.

The council’s funding policy now includes one-off grants for individuals, in addition to organised community groups. Clarification of funding policy reveals that grants are available for work on uncovenanted, as

well as covenanted properties.

The regional council fund supports purchase of materials such as traps and bait stations. Grants are capped at $5000 per application, of which up to $1000 may be for contracted services.

UCLA spokeperson Reihana Robinson, who advocated as representative on WRC’s Coromandel catchment committee for the changes to the council’s funding policy, says the funding option for individuals on uncovenanted land is a big step forward for protecting vast additional areas of bush on the peninsula.

“Many Coromandel residents have been working independently, off their own bat and in their own

time and at their own expense, to protect and enhance our ecosystems and natural environment. These conservationists deserve the same financial support from council that is afforded to groups and incorporated societies,” Robinson said.

“As for extending grants to work on uncovenanted properties, most stoats and rats I’ve met don’t stop to check the LIM report on a bush block before killing a nestling. All our bush heritage merits the same protection and support.”

Applications are now being accepted by WRC until March 21.

The application form is downloadable from the regional council website or can be requested from Dave Byers at WRC in Hamilton.

DAIRY NEWS MARCH 8, 2016

ANIMAL HEALTH // 27

Industry to treat bobby calves better

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An action plan on caring for bobby calves is being drawn up.

and process ‘mapping’ with farmers to ensure everyone well understands the onfarm elements of bobby calf care.

“Farmers gave us valuable feedback in the interviews. It is essential that we work with them to ensure that any changes are well thought through, practical, workable, cost effective and result in genuine welfare benefits.

“We’ll continue to keep talking to farmers as we finalise advice on improvements that farmers can make this coming season. Generally those interviewed saw our initiative as a positive opportunity to review the current process and how to improve it, particularly when viewed through public eyes. Another saw ‘education, not regulation’ as the answer’,” he says. dairynz.co.nz/bobbycalves.

TB restrictions easing STOCK MOVEMENT restrictions

and TB testing requirements have been eased from March 1.

Disease control areas are reduced, now affecting 5.3 million hectares and about 10,000 herds, resulting in 500,000 fewer TB tests, according to OSPRI. Farmers in regions where movement controls have been removed will be free to move stock without any premovement tests; and they will be subject to fewer TB tests as special testing area requirements are reduced.

OSPRI quotes Tasman dairy farmer Phil Riley as saying he has grown used

to pre-movement TB testing after doing it for 22 years, but will be glad to see the back of it.

“A lot of us had got used to it, and it’s just another job you have to do onfarm. But it’s great to see the back of it, because it makes it that bit more difficult if you happen to be selling your farm or stock.”

Since 2011, OSPRI’s TBfree programme has eradicated TB from 1.2 million ha and infected herds are down to 35 from nearly 1700 in 1994.

Riley agrees that as we get better at pinpointing where the risk is, movement control areas will shrink.

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but on actions. We [will work] with everyone in the supply chain, including farmers, to ensure bobby calves are well cared for.

We have ensured some good practice advice is already available and that farmers have forums available where they can share their own good management practices.”

Tim Ritchie, chief executive of the Meat Industry Association, says the meat processing and export industry is well regulated and that the meat industry, together with the dairy industry, is systematically reviewing the path from farm to processor to identify opportunities for improvement. This will be finished before the next bobby calf season.

DairyNZ animal husbandry and welfare team leader Chris Leach says it is important to test ideas

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farmers will help prepare an industry action plan on caring for bobby calves from farm to processor.

DairyNZ will use the feedback in working with six other industry associations to develop a plan for the next calving season.

DairyNZ, the Meat Industry Association, Federated Farmers, the Road Transport Forum, NZ Petfood Manufacturers Association, the Dairy Companies Association of NZ, NZ Veterinary Association, and the Ministry for Primary Industries have agreed to stamp out mistreatment of calves.

The farmer insights result from 20 interviews with farmers by DairyNZ staff in Northland, Waikato, lower North Island, Canterbury and Southland. The respondents were farm owners, sharemilkers or operational managers, in a feedback group representing a cross-section of farm ownership type, farm system and size.

DairyNZ chief executive Tim Mackle says the dairy industry is focused on preparing for the next calving season and giving good advice to farmers.

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DAIRY NEWS MARCH 8, 2016

28 // ANIMAL HEALTH

Digital dermatitis is here DIGITAL DERMATITIS is the most

serious infectious cause of lameness in dairy cattle worldwide, and now affects New Zealand dairy herds, says Richard Laven, associate professor in production animal health at Massey University.

Typically, digital dermatitis is found on the skin just above the interdigital space, and it may also be found along the coronary band.

Digital dermatitis is most commonly found on the hind feet; fewer than 3%

of affected cattle have lesions on the front feet only.

The classical lesion of digital dermatitis is a moist ulcer, Laven says.

However, digital dermatitis is a cyclical disease with lesions forming, healing and then returning, so it has multiple stages. The most persistent stage (often called M4) is a chronic thickening of the skin with rapidly spreading growths which can often resemble hairs (in some countries these are called hairy hoof warts).

In NZ the most common appearance of digital dermatitis is a small lesion less than 1 cm in size.

Larger lesions, either when they develop into ulcers or when they are growing, tend to be extremely painful Digital dermatitis was first identified in Northern Italy in 1974, and is now reported worldwide.

The first NZ case occurred in 2004, with sporadic reports until around 2011 when the number increased markedly.

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Fodder beet supplement pays its way FODDER BEET is an increasingly popular winter

crop for beef and dairy cattle due to the large amounts of dry matter it produces, but stock won’t get the best out of the crop if its nutritional gaps aren’t managed, warns product development manager Jackie Aveling, of SealesWinslow.

Its high sugar content makes fodder beet very palatable to stock, but it has sub-optimal protein content (13%), low fibre levels (<20%) and is low in phosphorus, magnesium and essential trace elements.

“At SealesWinslow, we’ve found a way to overcome these issues with a solution that’s easy to use and which provides good nutritional support for stock grazing on fodder beet,” says Aveling.

The result is a specially formulated Cattle Fodder Beet Block now on sale following on farm testing.

The new block addresses phosphorus deficiency and balances other minerals like magnesium and essential trace elements that are lacking in cows and heifers on a fodder beet diet.

“A diet deficient in these minerals, particularly phosphorus, can lead to ‘creeper cows’ in the short term, and longer-term difficulties including poor milk production, reduced appetite, weight loss and poor reproductive performance.

“Current practice to reduce the chance of phosphate deficiencies developing in stock grazed on fodder beet is to dust the crop with dicalcium phosphate (DCP) or use a slurry of the compound on silage or straw. However these practices can be dusty, timeconsuming, wasteful and the intake is variable.”

The new Cattle Fodder Beet Blocks come in 25kg tubs which are simply placed at the crop face under the fence in front of the cows.

Available from merchant retail stores, the block is said to pay its way in convenience, labour time saved, lower downer costs and longer-term stock problems, the supplier says.

It also compares favourably with the price of a single intravenous downer cow treatment. The recommended block to cow ratio is 1:25.

DAIRY NEWS MARCH 8, 2016

EFFLUENT & WATER MANAGEMENT // 29

Fertiliser value of effluent FARM DAIRY effluent is a natural,

dilute liquid fertiliser.

It contains nitrogen (N), phosphorus (P), potassium (K), magnesium (Mg), sulphur (S) and trace elements that you would normally pay to have applied to pasture.

Think of dairy effluent as a resource, not a waste.

When spread over land and applied in timely fashion, the effluent of 100 cows can save farmers substantial money. This saving could be much higher for high input farms, e.g. farms feeding supplements.

Applying the maximum amount of nitrogen from effluent allowed per year (150kg/ha for grazed grass), dairy shed effluent also provides about: ■■ 20kg phosphate per hectare ■■ 117kg potassium per hectare ■■ 20-30kg sulphur per hectare ■■ Smaller amounts of magnesium and calcium.

Applying effluent Effluent management systems in place on your farm should give you enough flexibility so that you don’t

irrigate: ■■ When soil is waterlogged (too wet to absorb the effluent) ■■ If there is an equipment breakdown.

■■ Remember to cover water troughs when irrigating effluent.

■■ Protect waterways on your farm by: ■■ Not irrigating within 50m of a water supply ■■ Leaving a strip of non-irrigated land next to all watercourses – at least 20m wide ■■ Ensuring that spray drift isn’t getting into nearby streams or rivers.

Soil – a living filter Soil acts as a living filter. It treats the applied effluent by changing it: ■■ Physically – filtering out effluent particles, breaking them down and incorporating them into the soil

Think of effluent as a resource, not a waste.

■■

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structure Chemically – absorbing nutrients and making them available to plants Biologically – harmful micro-organ-

isms (such as bacteria) present in the effluent are retained by the soil, or are killed when the effluent dries or when they become exposed to sunlight.

■■

■■

Don’t apply too much Soil can only filter so much effluent at a time. It’s important to match the irrigation depth to the capability of the soil. Land with impeded or artificial drainage, high or rising water tables or slopes greater than 7 degrees have a higher risk of over-application, and therefore application depths should be adjusted accordingly to reflect soil and weather conditions. Note this could be less than the maximum application depth stated in Waikato Regional Council rules.

Too much effluent can: ■■ Kill pasture – especially where effluent has ‘ponded’ on the soil surface ■■ Pollute nearby streams and rivers – where it runs off paddocks into waterways Pollute groundwater – by seeping too deep into the soil Be an ineffective use of nutrients -- by seeping past the root zone before the plant can utilise it.

DAIRY NEWS MARCH 8, 2016

30 // EFFLUENT & WATER MANAGEMENT

Data monitoring ensures staying within the rules FARM DATA monitoring has risen to a new level using technology that ensures compliance with a new code, says one such system supplier.

Smart Farm Systems, and its sister company Gateway Data Services, point out that the New Zealand Farm Data Code of Practice requires data to be encrypted and stored securely, to allow proof of placement of effluent on land (rate and depth), and to confirm that a farm’s water usage is in line with its consent and with new vat monitoring rules in force from August 1 this year.

The companies say they have developed a managed ‘gap redundancy’ system with high data integrity and secure cloud backup.

Gateway Data Services collects farm data from onfarm sensors

compliance conditions and can help economise on animal health products in water troughs. It will signal any spike in water usage above set levels, caused by, say, a leaking water line or above normal rate of drinking by a sick animal or fowl.

Technology of this calibre is the future of farming, the company says.

“Providing real time applications in a corporate farming environment provides an audit trail of responses to alerts to assist in on farm training and accountability.”

As regional councils favour compliance reports from accredited data service providers, Gateway Data Services is positioned to provide encrypted data for environmental plans, industry reports and operating reports.

such as soil moisture tapes, water meters and effluent applicators on dairy, goat and pig farms -- in fact anywhere sensors need monitoring.

The company’s GDS app monitors in real time, allowing rapid response by farm staff; notifications and critical alerts can be customised to a farm. “Just what you’ve been looking for,” says the company.

Gateway Data Services says it sets a high priority on farm safety and recognises what it takes to farm in a remote location or just to manage a business.

The app includes an emergency safety alert which will send out a GPS co-ordinate to names on a contact list, so the closest can tell the manager that help is on its way.

The app helps a farm to meet

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The soil type where your effluent pond will be located is key.

Location of pond A SITE investigation before design and

construction starts is important to make sure the pond can be built structurally sound given the site conditions and to meet regulations, says DairyNZ. While an engineer will probably do the site investigation, the responsibility for proving the adequacy of a pond and liner rests with the farmer.

The soil type where the effluent pond will be located is also important.

In comparison to most other soil types, peat soils require more ground investigation. The main issues are peat thickness, strength, compressibility and groundwater level.

Before ground investigations begin, a desktop study should be done by your designer, who should then explore the site.

There should be a minimum of three holes around the perimeter of the proposed tank or pond. The investigation should extend to the full depth of the peat, or to twice the width of the proposed tank or pond bank.

Your designer should then perform specific engineering tests to determine

the suitability of the site and the design requirements.

During the investigation and design stage make sure you discuss with the designer the cost versus benefit of different design options for peat versus the long term maintenance costs of each.

Effluent systems can include a solids separation component. This can be either mechanical (press type systems) or nonmechanical (weeping wall type systems).

If solids are removed prior to the effluent reaching the storage pond, this averts or at least reduces the risks inherent in managing the solids in the pond. But you still must store and manage them.

Mechanical removal should usually be done before effluent enters the storage pond.

Non-mechanical separation methods are generally weeping wall or settling pond systems. These fundamentally change the pond design requirements. In this case the pond component of the solids removal system needs to be designed specifically for solids removal.

DAIRY NEWS MARCH 8, 2016

EFFLUENT & WATER MANAGEMENT // 31

Field day turnout shows farmer interest says Palmer, a sustainable agricultural advisor at Waikato Regional Council.

“It’s excellent to see such farmer interest in managing dairy effluent.”

Farmers at the event, held near Rotorua, were able to consult experts from DairyNZ, AgFirst and OPUS, and council staff.

Dairy companies Fonterra and Miraka were on hand to talk about their envi-

Treat poo as fert DAIRY FARM effluent should be treated as a fertiliser, but carefully, because it is not a balanced fertiliser, being very high in potassium.

This can lead to higher leaching levels of magnesium and subsequent animal health problems if potassium soil test levels are high.

According to Waikato Regional Council, you can manage this risk by increasing the effluent area or by making silage on the effluent area and feeding it out on non-effluent areas of the farm.

Applying shed effluent at light rates will ensure stock feed intakes are not adversely affected. Managing dairy effluent is also necessary for the health of waterways and groundwater, so knowing the regional council’s rules for effluent management is important.

Under the Waikato Regional Plan you cannot exceed 25mm per application and 150kg of nitrogen from effluent per hectare per year.

“So you need to know how much your irrigator is applying and how concentrated your effluent is,” the council says.

“Dairy effluent must not discharge into surface water or contaminate groundwater. Having the capacity to store effluent before it is applied to land means effluent doesn’t have to be applied during wet periods when the risk of surface ponding and runoff is high.

This substantially reduces the risk of overflows to surface water and maximises plant nutrient uptake.

Effluent storage facilities should be sealed to the required standard of 1 x 10-9 m/s. Storage should be correctly sized for your individual farm system and management.

Having adequate storage means that you: ■■ Can defer irrigation in wet weather ■■ Lower the risk of ponding, run off and leaching in wet weather ■■ Irrigate when plant uptake is maximised ■■ Can irrigate in dry weather ■■ Can store effluent during mechanical breakdown ■■ Have less stress during busy times, e.g. calving.

Increasing your effluent area means that you: ■■ Spread nutrients further, reducing fertiliser requirements and associated costs ■■ Slow the buildup of potassium in effluent paddocks which can lead to animal health problems in the early spring ■■ Have more flexibility in grazing around effluent applications and safer withholding periods prior to grazing.

The Pond Calculator is an excellent tool if you are building a new effluent pond. Accredited effluent system designers will assist in matching all components of effluent management to your farming system.

ronmental initiatives.

The council is talking one-to-one with farmers to help them ensure their effluent management systems are up to scratch, and is encouraging them to make improvements where required. It’s part

of a new region-wide approach.

“Farmers have been responding positively to this approach,” says Palmer.

Logan Bowler, DairyNZ (right) and Jon Palmer, Waikato Regional Council at the effluent field day.

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DAIRY NEWS MARCH 8, 2016

32 // EFFLUENT & WATER MANAGEMENT

How much effluent to irrigate?

ALTHOUGH EFFLUENT contains many nutri-

ents which can affect your farm management, it is the environmental effects of nitrogen that determine how much you can irrigate onto land, says Waikato Regional Council.

Too much nitrogen can reduce pasture performance and reduce water quality in neighbouring waterways.

If you know eactly how much nitrogen is in effluent, you can work out the

Too much nitrogen spread via effluent can affect pasture and water quality.

most effective application rates for your land.

In the Waikato region, no more than 150kg of nitrogen in effluent can be applied per hectare of grazed grass per year.

You’ll need to get effluent tested to work out how much nitrogen is going onto your land during irrigation.

Most registered analytical laboratories offer this service for around $100.

When used with a nutrient budget this is a small cost

For more information contact 0508 476 278 or sales@gatewaydataservices.com www.gatewaydataservices.com

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compared to the fertiliser savings possible over time when effluent applications are timed efficiently.

The Overseer nutrient budget can be used to help determine how much land is needed for effluent irrigation. For more information on Overseer, click here.

How deep does each application have to be?

Each effluent application must not be more than 25mm deep. How deep you irrigate effluent over an area will depend on how much nitrogen you want to apply. Use our online calculation sheet to work out application depth, given that you know: ■■ The nitrogen content of the effluent ■■ How much nitrogen (kg) you want to spread per hectare.

■■ Working out application rates Once you’ve worked out the application depth, you’ll need to work out the application rate for your irrigator.

Spray irrigators 1.

Using the same principal as a rain gauge, mark a scale on the sides of several containers.

2.

Place the containers within the area being irrigated.

3.

Stop irrigating when the desired depth (maximum of 25mm) has been applied.

Other irrigators To ensure you don’t over-irrigate, use our online calculation sheet to work out effluent application rates for: ■■ Travelling irrigators – the distance an irrigator needs to travel (in metres) per hour ■■ Stationary spray ‘cannons’ – the length of time a spray head can stay in one place ■■ Tanker systems -- the distance an irrigator needs to travel (in metres) per hour.

Ongoing irrigation management When irrigating check for effluent ponding, particularly in areas with pugging damage. Stop ponding by avoiding irrigation in these areas, or improve the drainage by: ■■ Loosening the soil in small ponding areas with a spade ■■ Breaking up the soil surface, e.g. by shallow ripping.

Because effluent contains a range of nutrients, irrigated areas will need less fertiliser. Talk to your fertiliser consultant about the reduced fertiliser needs of irrigated blocks.

REGULATIONS FOR APPLYING EFFLUENT

12 MONTHS INTEREST * FREE ON COBRA’S

IN WAIKATO region, applying effluent to land is a permitted activity. This means farmers can apply effluent without having to get a

THROUGH SELECTED DEALERS

resource consent, as long as you follow these conditions: ■■

No more than 150kg of nitrogen can be applied per hectare, per year (1.5 applications at 25mm deep and 0.04% nitrogen).

■■

The farmer/contractor must have contingency measures in place in case there is prolonged wet weather or a pump breaks down.

■■

Any ponds or effluent holding facilities must be sealed to reduce leakage.

■■

The farmer/contractor must spread effluent and sludge in a way that reduces

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25mm deep.

COBRA TRAVELLING RAINGUN ■■

For more information contact one of our local dealers, call 0800 889 7755 or visit hitechenviro.co.nz

Each effluent application must not exceed

DAIRY EFFLUENT PRODUCT SPECIALISTS

Effluent must not run off the land into waterways.

■■

Effluent must not pond on the land surface after application.

DAIRY NEWS MARCH 8, 2016

EFFLUENT & WATER MANAGEMENT // 33

Mainland system does the job on steep Oz land 100m after that is somegain the most value from to apply nutrients now MORE GRASS can thing he would do differthe nutrients in the effluresult from effective efflu- to areas of the farm that ently next time to enable were difficult to drive over ent. ent management, but you ease of flushing.

The effluent system and apply fertiliser to and have to get the system Holman also removed must be able to generwe’re now able to see a right. the foot valve from the ate enough pressure at response.”

In Australia, the effluent pump (which is The effluent was tested, the irrigator and prevent Holman family is applyimmersed on a pontoon) solids blockages in the ing effluent on more of its showing 1 megalitre conto allow effluent in the line steep property via a main- tained 232kg of potassium, pipes.

Holman had a plumber to drain back to the sump 95kg of phosphorus, 22kg line installed last year; size the mainline to ensure when turned off to flush of sulphur and 200kg of now they are starting to the pipe. it had the right pressure see benefits -- more grass. nitrogen. This is equivThe mainline is buried rating for the steeper alent to 0.46 tonnes of The property, at Loch to protect it from in the Strzelecki Ranges, stock trampling, Victoria, has some steep “Mainline flushing is important and to help reduce slopes that make effluto remove solid material if it gets blockages by keepent pumping difficult.

The farm milks ing the pipe cool pumped through.” about 400 spring calv– Andrew Holman over summer, reducing cows. Manure from ing the baking of the yards is collected by manure inside. property to ensure pumppotash, 0.43 tonnes of a solids trap and stored in Two posts and horiing efficiency and reduce urea and 1 tonne of single a 50,000L sump, pumped zontal rails protect the the risk of splitting pipes. superphosphate costing daily to pasture via a hydrants from stock and Solids from the efflu1300m mainline and a gun about $1015 per megalitre machinery. ent are removed by a trap (prices are a rough guide irrigator.

Effluent is managed to illustrate value of efflu- but some enters the sump daily. “At the end of each Expanding the effluwhere it is agitated then ent). ent application area has milking the effluent is applied daily to pasture.

Each year about 7.4 enabled better use of the gone; it’s not another job Holman says mainline megalitres is generated on nutrients in the effluent, I have to do. There are flushing is important to particularly potassium and the property with a fertilno excavators, tankers or remove solid material if it iser equivalence value of nitrogen. weeds on dams to deal gets pumped through. $7511.

The gun irrigator is with later.” These are the Placing hydrants at Reducing the maintemoved around every benefits of a direct appli50m intervals for the first nance cost of the effluent couple of days, Andrew cation system.

200m of the mainline then system is also needed to Holman says. “I’m able But it can be difficult

Australian farmer Andrew Holman amd Denis the Greyhound.

to manage these systems when conditions are wet so the farm has backup storage capacity.

The Melbourne Water Rural Land programme has supported the installation of the effluent mainline through a 50% co-contribution financial incentive. www.melbournewater. com.au

Pluck’s Traveling Effluent Irrigators: r Meet even the toughest New Zealand Effluent Enviro Standards r Have the Most Even Rain Cover over wetted width in New Zealand by far r Have a Rain Rate of 5mm or less across total wetted width, not just the centre area. (please see in the independently proved graph)

Applied Depth – No Overlap just 5 mm applied depth!

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The Growsmart Precision VRI system installed on Brian and Jo Bosch’s dairy farm in the South Wairarapa has been saving them precious water and dollars since it was first installed in 2008.

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The couple use the intelligent system to avoid watering the tracks, ponds and drains underneath their Zimmatic™ centrepivot. The water saved by avoiding these areas is diverted to other areas of the farm, increasing their irrigated land area by approximately 10%.

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What this means for you: r No more strips left in your paddock r No more doughnuts either r No more ponding left after each run r No more Enviroment police calling in

And after over six years of using the technology he’s pretty happy about the low maintenance requirements of the system hardware, “It’s just worked!”

The Bosch’s are not alone in the great results achieved using variable rate irrigation. Trials show savings of up to 27% on dairy and cropping farms are realistically achievable. Why? Because Precision VRI controls every individual sprinkler allowing you to irrigate where it is needed.

SIX YEARS ON AND BRIAN IS STILL SEEING GREEN

Find out how you could achieve great results like Brian and Jo by talking to your Zimmatic by Lindsay dealer today, calling 0800 438 627 or by visiting growsmartprecisionvri.co.nz

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DAIRY NEWS MARCH 8, 2016

34 // EFFLUENT & WATER MANAGEMENT

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Do your homework before pond construction A NEW effluent pond project must start with planning -- a critical stage, says DairyNZ. Poor information at the project’s start will compromise all and the pond may never meet your needs.

To ensure the designer and contractor have the right information, the farmer must be clear about design preferences and intentions for the future.

“You do not want your new pond to be inappropriate or unable to cope in five years,” DairyNZ says.

Using the right person or people for the job is also critical. Designing and constructing effluent ponds is a technical job requiring specialist knowledge.

The designer must be suitably qualified, to ensure: ■■ The investment in the pond will be appropriate for the farm and farming system ■■ The pond will comply with regional council requirements ■■ The pond is designed with an understanding of current research and best technology options ■■ The pond will meet the design requirements.

Earthworks and construction contractors and equipment/service suppliers may all be involved at different stages of the project, e.g. excavation and liner installation.

When choosing who to use, consider the following: ■■ Are they experienced in building effluent ponds?

■■ Do they have experi-

ESTABLISHING POND SIZE TO DETERMINE the pond size required for a deferred irrigation storage pond, use the industry’s ‘dairy effluent storage calculator’ (DESC).

Make provision for: ■■ Local rainfall variability: coverage of rain gauge sites in the calculator is patchy in some regions ■■

Variation in the amount of storage different regional councils require. We recommend that sizing be based on DESC calculations rather than a council minimum storage requirement where the latter gives a lesser volume

■■

The DESC determines pond volume and does not allow for freeboard or sludge accumulation volume.

ence in the type of pond and liner you want?

■■ Do they offer a warranty and/or certification of work?

■■ Do they have experience working with your specific regional council rules?

■■ Do they have farmer or industry professional references or testimonials?

■■ Are they acceptable to the person signing off the work?

Settling a suitable contract before design or construction begins is critical to ensure both parties are clear about expectations.

A written contract will protect your interests and sets out your rights and obligations. It also gives your engineer/contractor an incentive to get things right first time.

When discussing contracts with different parties: 1. Make sure the roles and responsibilities of the farmer, contractor and engineer are clearly

defined before construction work starts.

2. Clearly define who the subcontractors are directly working for -- the contractor, the engineer or yourself.

The scope of the services to be provided should be clearly recorded and agreed to, for a full understanding by all parties from the outset. The following elements should be included in the scope of work: ■■ Evaluation of the existing system (if applicable) ■■ Identify improvement options/advise good practice systems ■■ Survey and geotechnical investigations ■■ Design ■■ Tendering and tender evaluation/recommendation ■■ Construction supervision ■■ Certification and reporting ■■ Operations and maintenance ■■ Payment schedule.

DAIRY NEWS MARCH 8, 2016

EFFLUENT & WATER MANAGEMENT // 35

Oz auto irrigator thinks before it waters RESEARCHERS AT

the Tasmanian Institute of Agriculture (TIA) are using sensors and autonomous technology to develop a system that tells you when to irrigate your pasture, then goes ahead and does it for you.

The system automatically irrigates pasture, and it will apply variable volumes of water to the same paddock, which could save time, water and money.

R&D team leader at the TIA Dairy Centre and chief investigator on the project, Dr James Hills, says the end goal is an autonomous machine interface that collects information about the pasture, water use, soil and climate and then uses crop modelling processes to make decisions about when and where to apply water.

The development of this autonomous system is part of a bigger three year project looking at the use of irrigation water in pastures by collecting data on water use,

enables us to increase our agricultural productivity, but we need to do it properly and sustainably,” Hills says.

“To introduce management strategies that increase efficiency we really need that baseline data. We need to know the facts and figures for water use to know how to improve on that use.”

The trial sites have been selected to give enough variability across different topography and soils that are likely to be irrigated.

David McLaren, project officer at the TIA Dairy Centre, is on the ground installing the sensors and data logging equipment at the sites and will also oversee the data collected in the field.

“A big part of the project will be to visualise that data, so that when it comes to making management decisions we can quickly know what to do through a visual display of data,

University of Southern Queensland, which has developed a control platform called VARIWise.

The VARIWise system has been developed and tested in cotton, but this

is the first time it will be applied to a pasture based system.

Installation of the sensor and logging equipment on the sites was completed in October.

Research and development team leader at the TIA Dairy Centre Dr James Hills with project officer David McLaren.

THE WISDOM TO GET WATER PRECISELY WHERE YOU NEED IT.

energy use and pasture production from five sites in Tasmania.

Paying for the project are the federal Department of Agriculture and Water Resources (under the Rural R&D for Profit programme), Dairy Australia and TIA. From the data collected at the five sites, the team will work with farmers to make changes to improve water use efficiency and will continue monitoring the sites to measure the success of these changes.

Hills says gathering this benchmarking data is an essential step to getting the most out of the new irrigation schemes.

“The funding of irrigation infrastructure in Tasmania by federal and state governments

and not have to interpret numbers,” McLaren says.

“The devices on site will have an interface that you can connect to from your smartphone or tablet so you can start to look at real-time values of pressure, temperature and energy without being physically on site, which is a real advantage.”

In its third year the project will trial an automation system at one of the sites to see how this type of system could be used to save farmers time and effort.

“We are interested in how far we can go using a system with a machine interface as opposed to a human interface,” Hills says.

To do this, the team has linked with The National Centre for Engineering in Agriculture at the

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“We are interested in how far we can go using a system with a machine interface as opposed to a human interface.”

DAIRY NEWS MARCH 8, 2016

36 // EFFLUENT & WATER MANAGEMENT Effluent Monitoring and Controlling capabili4es that are important to consider, now and for the future Auto Shut Off This is the most basic func0on - shu2ng down of the pump if the irrigator stops moving.

Fail Safe

GPS records

True fail-safe means pumping con0nues provided there is a constant flow of data from the monitor at the irrigator back to the controller at the pump, showing the system is opera0ng within the set parameters.

Not only to ensure compliance (if not in your province now but increasingly in the future) but also to create reliable management records of where staff have been applying effluent, GPS records are important, especially when able to be integrated with fer0liser records.

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Overseer & Milk Company data Milk companies and Overseer will increasingly require confirma0on of environmental best prac0ce, so being able to call up complete, accurate electronic records is important future-proofing when selec0ng an effluent monitoring and controlling system.

Integra4on with fer4liser

Integra4on with MINDA

Reducing fer0liser applica0on by the right amount in effluent areas saves on fer0liser, provided the farmer can both monitor the amount and loca0on of effluent applied, and also adjust fer0liser orders correctly, in an integrated GPS-based pasture management system, especially if it also records soil moisture and temperature.

Taking costs out of pasture based systems while op0mising produc0on is more important than ever, so being able to bring all management informa0on including herd data together to iden0fy cost savings while also making management decisions more accurately and more quickly is a major benefit of using an effluent system that integrates with MINDA.

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on accurate data to result, and potentially a support management hefty fine for a resource upgrading or fine-tuning decisionmaking. An breach. pumps, ponds and pipes effluent monitoring and Best to buy a system -- the ‘three P’s’ of dairy control system needs to that constantly sends effluent infrastructure send data across the farm, metrics such as pressure – dairy farmers are using the same network at the irrigator and increasingly using movement that keeps the or UHF equipment as technology to monitor other devices onfarm. and control their systems, pump going; but such a Buying a proprietary system will interpret any says Precision Farming system that is ‘sealed’, cessation of the ‘keep Ltd. pumping’ data -- whether i.e. that will operate only There are two with itself and will not because of a fault with reasons: to improve link with other onfarm the irrigator or with the farm performance by activities, is obsolete messaging itself -- as a reducing costs, and for even now, never mind in reason to shut off the safer environmental the future as modularity compliance, the company pump. Good. becomes the norm.

Compliance says.

Integration After spending When installed on Dairy farms are hefty sums on effluent farms that use a pond complex businesses infrastructure, it makes or saucer for effluent with substantial sense to complete the storage, monitoring interdependence between entire system with a and control systems herd and pasture, monitor/controller, typically have three sets people and production. but only if it ensures of components: ■■ First, hardware Until recently, companies selling that controls sophisticated the pump and ‘If you are looking technology have the stirrer, at the to have a fail-safe tended to polarise pond or in the into two camps – shed system, make sure it ■■ Second, hardware herd and pasture. can be trusted.’

A step change that operates is now afoot, at the effluent notably in LIC’s distribution long-term partnership environmental end, whether K-lines with Precision Farming. compliance. To ensure or pods, a travelling LIC’s expertise is chiefly compliance-quality data, irrigator, or a pivot, in livestock, whereas whether underslung or GPS-based records of applied nutrients will injected Precision Farming’s is in ■■ Third, software that increasingly need to be pasture. This partnership will now allow dairy enables the controlling complete and accurate, and electronically farmers to accumulate and monitoring, generated and recorded. their herd and pasture providing local and Entering records data in one place, remote starting and manually is subject to optimising their farm stopping, alerts, auto hit-and-miss, human performance, especially shut-down, GPS and error, and perhaps even in the interdependence of flow data reporting, intentional fudging by herd and pasture. and more. staff who were too busy When considering an When considering effluent monitoring and what effluent monitoring to relocate the irrigator and control system is best when the farm owner was control system, think of away. it as one building block for the farm in question, in the whole structure the following are primary: Financial viability The set-up and of farm management Trustworthiness operation costs of a good information, rather than If you are looking to system when properly a single activity on its have a fail-safe system, designed and integrated own. This approach, make sure it can be not only show a return bringing together herd trusted. Some monitors on capital investment but data including feed work by sending a also save money. Fresh, demand with pasture message such as a text, nutrient-rich effluent is production including only when something a valuable resource, so feed wedge, fertiliser, goes wrong with your setting up an optimal effluent, soil moisture irrigator, for example if system should generate a and temperature and the wire rope jams and the irrigator stops moving return on investment, and other data takes the cut indirect costs such as farmer takes the farmer a but it keeps spreading. staff time and wear and long way towards cutting However if the tear on quads. costs in a pasture based messaging system itself Modularity system. fails, then the alert does Dairy farms not get through and an @dairy_news increasingly rely effluent ‘doughnut’ can facebook.com/dairynews AFTER INSTALLING,

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DAIRY NEWS MARCH 8, 2016

MACHINERY & PRODUCTS // 37

Heavy metal hits Mystery Creek MARK DANIEL markd@ruralnews.co.nz

A RECENT unreserved auction held by specialists Ritchie Bros saw around 320 lots of plant and heavy machinery sold at Mystery Creek Event Centre near Hamilton.

There was something for everyone: 30 tonne excavators, dump trucks, road rollers and pickup trucks – plenty of big boys’ toys for construction heavyweights and farming folk alike.

With the sun shining, 350 registered bidders took to the field and around 160 online bidders checked in from as far

afield as Hong Kong, New York and Stockholm.

Ritchies’ managing director Asia Pacific, Kieran Holm, debunked the idea that New Zealand is the home of high priced machinery. “This type of machinery is well priced in NZ, as evidenced with buyers from as far afield as Europe seeing value, despite the typically high freight costs in getting stuff home.”

Ritchies set up in Canada in 1958 and is now the largest company of its type in the world:

2015 turnover was US$4.3 billion, of which US$1.5 was conducted online.

It has 44 permanent auction sites worldwide and runs about 350 auctions each year. Their scale is seen in a recent fiveday event in Florida where sales were US$175 million.

Holm also commented “our business sees global liquidity as economies around the world rise and fall, and although we deal in big lumps of metal, with a little bit of thought and ingenuity they can be moved around the globe”. www.rbauction.com

Machinery on display at Mystery Creek.

Saxon conquers min-till WELL KNOWN for its Centurion and Spartan drill series, Great Plains has recently introduced the all-new Saxon series, with mintill work in mind.

Based on the Centurion series launched in 2012, the Saxon will work where there are high volumes of residue from previous crops or in established cover crops.

The series comes in 3m and 4m working widths and carries over a lot of the seed delivery, placement and consolidation features of the Centurion; but it has a key difference -- Great Plains Turbo coulter discs.

This set-up has a good slicing action with minimal disturbance. Each disc is set to operate in-

Come and see us at Fieldays: Sites G118 &G120 line with trailing double-disc openers, their unique profile creating a friable seedbed 30-50mm wide into which the seeds are planted.

Both machines use the same 3000L capacity hopper also found on the Centurion series, although an upgrade to 4000L is available for the 4m model. Spacing on the 3m models can

be set at 167mm over 18 rows, or narrowed down to 125mm spread over 24 rows; the 4m model can be set to the same spacings over 24 or 32 rows.

Hydraulic downpressure helps maintain an even depth in all soil types, and accuracy is ensured by a rail that transfers weight to the coulters and press wheels, whilst keeping

everything parallel to the ground.

Seed distribution is via injection moulded distribution heads, with optional tramline shut off and blockage monitors, and the system is said to be variable rate application ready.

Seed calibration is easy, selected from the cab. www.powerfarming. co.nz

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DAIRY NEWS MARCH 8, 2016

38 // MACHINERY & PRODUCTS The latest Jaguar harvester from Claas.

Take the guesswork out of harvesting MARK DANIEL markd@ruralnews.co.nz

SELF-PROPELLED FORAGE harvesters

have come a long way since the early 1970s when they struggled to push 200hp, whereas now there are machines in paddocks bigger than 1000hp.

But power isn’t everything; now there are technologies in the new machines that can improve output and help make useful harvesting and future production decisions.

The latest Jaguar harvesters from Claas offer operator focussed items such as Opti-Fill to increase performance, and they take partial control of the delivery spout to allow the driver to focus on crop input, and in practice control the spout position and more importantly the end flap to achieve maximum trailer fills.

But crop measurement technologies are the ones that truly move the range into the 21st century.

The Claas Quantimeter can measure output in tonnes/hour tonnes/ha by utilising position sensors in the upper rear feed roller, which measure the feed opening, feed roller and forward speeds to produce a tonnage throughput figure. This can be squared up with test weighings -- inputting a correction factor to ensure accuracy -- and is recom-

The NIR sensor allows the operator to decide timing of harvest.

But power isn’t everything; now there are technologies in the new machines that can improve output and help make useful harvesting and future production decisions. mended when crop or field conditions change.

Until recently moisture measurement was done by a dry matter sensor that read the conductivity and temperature to deliver an average DM figure, and is still a good option for operators working mainly with grass.

Intended for use with a wider range of crops is the recently introduced near infra-red (NIR) sensor system which marks a step up in operating range and accuracy, using a spectrometer that measures specific wavelengths 20 times/second.

Able to deliver moisture readings for grass

of 24-65% and maize 20-60%, the unit also showed improved accuracy to 98.6% during testing by the prestigious DLG organisation in Germany.

This new technology will allow operators to decide timing of harvest, and to make informed decisions to cease harvesting should crop or weather conditions deteriorate.

The current Claas harvesters also offer a range of Data management strategies by way of the Telematics systems now incorporated.

Likened to the telemetry systems that tell Formula 1 technicians how the car is performing

and being driven on the track, the Claas Telematics system sends information on 200 parameters to a central database every 5 seconds. A licensing agreement allows users or managers to access this information to look at machine performance, such as operating versus travel time, time stationary, crop throughputs or fuel used. It can also be used to look at crop yields, identifying areas of high or low yields in specific areas, and produce data that can be supplied as an ISO XML download that will allow the information to be incorporated into proprietary yield management or yield mapping applications.

One thing’s for sure in today’s modern agriculture: information is king, and the evolution will move on at a pace, so be sure not to blink and miss it.

DAIRY NEWS MARCH 8, 2016

MACHINERY & PRODUCTS // 39

Vat monitor makes sure milk stays cool A NEW all-in-one milk vat monitor and controller that ensures milk is cooled and held to temperature has been launched by TruTest. Its launch coincides with tougher cooling standards requiring raw milk be cooled faster and held at the correct temperature.

Vat Manager Plus, made by Tru-Test, regulates temperature and agitation, and monitors critical incoming and in-vat milk temperatures and rates of temperature change. The unit, with its supporting online interface, holds memory for data recording, storage and audit requirements and reliably warns of cooling problems inside and outside the vat.

Text messages and emails generated by Vat Manager Plus to multiple devices will alert farmers if their milk cooling is not on track. Early notification includes milk which is too hot, too cold or taking too long to cool, plus wash, power and hardware faults.

Tru-Test general manager New Zealand, Verne Atmore, says cooling problems can be difficult to detect; they may be caused by a farmer forgetting to throw a switch, a power outage or hidden pre-cooling or vat problems.

“At present, discovery of milk cooling issues Text messages will alert farmers if milk cooling is not on track.

regularly happens at tanker pick-up or when the farmer gets a temperature grade. Farmers bear the cost of detecting poorly chilled milk late in the process. They receive no payment for rejected milk.

“Vat Manager Plus will help make latent cooling problems visible so farmers can investigate.

With tighter control of onfarm cooling and early response to issues as they happen, farmers will have better control over the quality of milk presented for sale and will maximise the payment for their efforts,” Atmore says.

The company says industry flow-on benefits from farmers using the product could include a greater national milk yield at current inputs and removal of waste from the dairy supply chain.

“In the bigger picture, we are moving towards solutions that show New Zealand at the global forefront of responsible dairying,” she says.

Vat Manager Plus is a robust vat-side unit with temperature display easily viewable at a distance, in low light and extreme brightness, and includes high-specification system components and temperature probes.

It provides a vat-side 30-day history of the vat’s contents, complemented by longer history online.

The product is priced

at $1795 plus installation cost.

Tru-Test also anticipates launching Vat Manager Auto, a ‘premium’ monitorcontroller which will automatically turn on vat

and side wall refrigeration and signal vat volume alerts.

The company also makes livestock weighing and ID systems, dairy refrigeration and data management systems.

Tougher milk cooling standards are being introduced.

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DAIRY NEWS MARCH 8, 2016

40 // MACHINERY & PRODUCTS

Giltrap plays hardball with Hardox MARK DANIEL markd@ruralnews.co.nz Kia Sportage 2016 model.

WITH A history dating

back 57 years to 1959, it’s safe to say Giltrap Engineering knows how to manufacture trailers. A first look at its recent Construction series suggest this is so.

Brought about by requests from contractors for a reliable heavyduty trailer for general work, and and able to add a silage bin during the season, the series also lends itself to construction and quarry site work.

There are four standard models with volumes 6-11 cu.m and nominal capacities of 12-22 tonnes.

The trailers have a heavyduty chassis that carries a tipper body made from 6mm Hardox 450 steel.

Hardox is up to 35% lighter than traditional fine grain steels, resulting in a lower machine tare weight and a greater payload. The material is also extremely resistant to knocks, dents or scrapes inflicted by boulders or rubble; it has rated yield strength of 1100 MPa compared to a typical mild steel’s 250 MPa. Units are supplied as standard on heavy-duty

Bang-up SUV just what they want MARK DANIEL markd@ruralnews.co.nz

Giltrap’s Construction series trailers.

tandem axles; the braked front axles have oscillating beams using oil impregnated nylon bushes for longer service life. Oversize 560-60R22.5 tyres ensure good usability in poor conditions. To ensure some comfort for the operator, col spring drawbar suspension combines with a 25 tonne rated swivel eye coupling or an optional K80 ball hitch.

Calling on its lengthy expertise, the team at Otorohanga has come up with design features to make the unit more durable and user friendly.

With a body width of 2735mm -- versus a container landed import mea-

suring only 2250mm -- the trailers are said to be extremely stable and to travel well over difficult terrain; and their rated capacities are achieved using lower sides, resulting in a lower centre of gravity and increased safety.

Another clever design feature is the lower cylinder mount for the tipping mechanism. This uses a four-way pivot system which counters sideforces that threaten to damage the cylinder, the internal seals or ultimately the trailer body, during emptying on level or sloping ground.

The standard pack-

age includes an extended front headboard to protect against overspill, a high clearance hydraulic tail door, a hydraulic parking stand, and, on the safety front, robust mudguards and LED lighting. Options include rear door spreading chains, a sprung steering axle and rollover silage sheets.

Sales and marketing manager Eric Crosby commented “we have supplied a number of units to customers which have exceeded their expectations, and we’re now building a number of bespoke units -- a further option with this series”. www.giltrapag.co.nz

AS THE top selling model for Kia

Motors, the arrival of the 2016 Sportage SUV is timely considering New Zealand’s current love affair with this type of vehicle.

Drawing on a pedigree that saw the Sportage become the first compact SUV on its introduction in 1996, the outgoing model went on to sell 1.6 million vehicles in 2010-2015.

The fourth-generation 2016 model is bigger, more sophisticated and offers higher levels of comfort and technology. Its new look has lots more ‘presence’ -- the headlights are located higher and combine with the ‘tiger-nose’ grille to create a distinctive frontal aspect. A redesign sees a 30mm increase in wheelbase, an overall lengthening of the vehicle by 40mm and a swept back rear spoiler which reduces overall drag, but more importantly results in more room for passengers and luggage. Inside, high quality, soft touch materials are used throughout, and leather is the favoured upholstery on

all models except the entry level LX version.

For power, the choice is between three engines: a 2L petrol that puts out 114kW / 192Nm torque, a 2.4L delivering 135Kw / 237Nm, and a 2L diesel developing 136kW and a gnarly 400Nm. A redesigned fully independent suspension system and electric power steering are tuned specifically for NZ conditions, refining the handling, ride comfort and stability. These and the interior improvements greatly reduce noise and vibrations.

As with any new model introduction, safety is to the forefront, seen in a raft of model dependent inclusions such as blind spot detection, lane change assist, rear cross traffic alert and a forward collision warning system. Then there is satellite navigation, a reversing camera, rear parking sensors, a panoramic roof, Xenon HID headlights and a hands-free powered tailgate function.

These features bring the Kia Sportage bang up to date and will find favour with those looking for a fully specified compact SUV. www.kia.co.nz

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