Dairy News 14 March 2017

Fonterra shares for overseas suppliers? PAGE 3 CASH SPLASH

Water scheme grant PAGE 22

FEDS POLL

First woman president?

PAGE 10

MARCH 14, 2017 ISSUE 374 // www.dairynews.co.nz

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Fonterra shares for overseas suppliers? PAGE 3 CASH SPLASH

Water scheme grant PAGE 22

FEDS POLL

First woman president?

PAGE 10

MARCH 14, 2017 ISSUE 374 // www.dairynews.co.nz

NO PAIN NO GAIN Job cuts loom as new Westland Milk co-op chief executive Toni Brendish sets out to steady the ship . PAGE 3-4

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DAIRY NEWS MARCH 14, 2017

NEWS // 3

Overseas suppliers may get stake in co-op SUDESH KISSUN sudeshk@ruralnews.co.nz

FONTERRA CHAIRMAN John Wilson says Innovation pitch.

PG.08

OAD milking attraction.

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overseas milk suppliers could be allowed to own shares in the co-op.

Speaking at the NZ Co-op business leaders forum in Auckland recently, Wilson did not rule out a co-op linkage with farmer suppliers in other countries.

“The opportunity to form some sort of cooperative linkage we certainly believe is possible,” he says. “It won’t be easy – surprise, surprise – but is certainly possible. My view is that those opportunities are becoming more real today than in the past.”

Wilson told the forum that of the 23 billion L of milk processed by Fonterra last year, NZ

farmers supplied 17.5b L. The rest is collected and processed in Australia, South America, China, Sri Lanka and Europe.

The average farmer shareholder in NZ has $880,000 invested in the co-op.

Wilson points out that Fonterra has “very strong control and ownership mechanisms”.

The forum heard there is an appetite among overseas suppliers to own Fonterra shares but capital could be an issue.

Fonterra director Nicola Shadbolt told the business leaders forum that in her travels around the world she is often asked by farmer suppliers about the possibility of owning Fonterra shares.

“The ‘belonging’ is the bit they are missing,” she says. But this also means coughing up $880,000, so there’s “a slight cost” involved, says Shadbolt.

“But if there are other ways of structuring that,

the belonging can still happen at no capital cost....

Some co-ops in the Nertherlands have class A and class B members. Class B members don’t have all the rights of class A members, so there are ways but this is an evolving issue.”

Shadbolt says Fonterra needs more milk to grow the business. “As demand for dairy grows, we need to have stickability with dairy farmers in other parts of the world. We don’t want not to have the milk.”

Federated Farmers dairy vice-chairman Chris Lewis says it’s a decision for Fonterra shareholders.

“If the directors and management of Fonterra can come up with an exciting proposal then farmer shareholders can debate and decide.”

Australian farmers some years ago expressed keenness to join as Fonterra shareholders. @dairy_news

facebook.com/dairynews

PKE ship in no man’s sea THE FATE of a ship carrying palm

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kernel expeller (PKE), ordered out of New Zealand waters because of its infested hull, was up in the air last week.

The DL Marigold was due to arrive in Suva, Fiji on March 10, but Fiji authorities refused clearance for its entry.

The Biosecurity Authority of Fiji (BAF) says it won’t admit the DL Marigold, which was ordered out of NZ by the Ministry of Primary Industries after divers found its hull invested with barnacles and tube worms.

BAF chief executive officer Xavier Khan says the BAF

operations team has told the ship’s agent, Campbell Shipping, of its decision.

A BAF media release says D L Marigold, containing palm kernel for feeding dairy cows, visited NZ on March 4.

“However, the ship was ordered to leave the Port of Tauranga following the discovery by MPI that the carrier’s hull and underwater surfaces are infested with a dense fouling of barnacles and with tube worms.

“DL Marigold then intended to come to Fiji on March 10, 2017, to clean the hull then return to NZ to offload the consignment.”

File photo of DL Marigold, that was ordered out of New Zealand and refused entry into Fiji because of an infested hull.

Dairy News understands the PKE shipment belongs to ADM. Khan says the DL Marigold could cause biofouling resulting in the introduction of invasive aquatic species to Fiji waters.

“This will never be allowed as it would be devastating for Fijian marine and aquatic species.”

Steve Gilbert, MPI’s border

clearance director, says the vessel won’t be allowed back into NZ until it can provide proof it has been thoroughly cleaned.

He says it is the first time MPI has ordered an international vessel to leave a NZ port for biofouling reasons.

“We were dealing with severe contamination in this case.”

DAIRY NEWS MARCH 14, 2017

4 // NEWS

SUCCESS BREEDS SUCCESS.

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WESTLAND MILK

Products’ (WMP) new chief executive says shareholders in the cooperative feel completely gutted at the performance of the co-op and they have every right to feel that way.

In an exclusive interview with Dairy News, Toni Brendish says Westland is disappointed it has not performed and that this has to be fixed.

For several months it’s been widely known that Westland is in financial

trouble and six months ago Brendish was hired to get the cooperative back on its feet. Now she is reviewing the company and has already hinted that major changes are afoot, including staff redundancies that will reduce overall staff numbers.

But she has told shareholders there is no silver bullet fix for the situation, “no light switch somebody needs to flick on so that we magically close the gap between ourselves and the other cooperatives; we have to go back and get it fixed right. For shareholders there will be

pain this year.

“We have been transparent that we won’t be matching the Fonterra price by closing the gap but everything we are doing is making sure we hit the new season well. I know that’s not palatable for our shareholders and we need to work with them one-on-one and see what can we do.”

Brendish says DairyNZ has published the fact that the breakeven price for dairy is now $5.30.

Canterbury suppliers will probably get less than that, and some dairy farmers on the West Coast will struggle and

Westland’s UHT destined for China.

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A MAJOR Westland Milk Products strategy is to increase the amount of value added products versus commodity milk powder; the much talked about figure was 30% percent, but the new chief executive, Toni Brendish, says the co-op still has not achieved this.

“The previous strategy was expressed as value added. As far as I am concerned, value added is not a strategy; I define value add as what you do, in other words an outcome.

“Having worked in fast moving consumer goods for nearly 30 years, I see value add as everything from your supply chain, your finance, marketing, products -everything. Westland’s strategy needs to be fine-tuned: we want the outcome of selling more value add, and the strategy is how we achieve that.”

Brendish believes Westland’s move into Canterbury was a good strategy because it helped achieve efficiencies within the business.

WMP’s getting back on its feet will require people who can execute the new operation strategies, she says. Redundancies are inevitable, but no numbers are available yet because the review of the organisation is not finalised.

New product initiatives will kick in over the next three months, all in the higher margin category. The Westland team is

focusing on efficiencies in sales and marketing and supply chain areas.

“Everyone including the shareholders is asking me for a time-line as to when things will happen. We have to get in place a number of things so that when we start the new season they have an impact. So we are talking August of this year.

“One reason for doing the review now is so that we are up and running and well prepared. A couple of other things probably won’t start to hit until the latter part of the year because they will require capital spending and various things. But we have to start seeing the benefit of the change from the start of the season.”

Being a small company enables WMP to be agile and to react quicker than larger companies -- an advantage, as is the uniqueness of the Westland story.

“I will probably tell it differently because of the person I am. There are many great stories to be told about how a cooperative works and how we are successful. People outside New Zealand love to hear how it evolved, and we want to connect the end user with the farmer; technology will make that happen. People will be able to see the farm, the cows and all aspects of the farming operation. For example, we know now that in China animal welfare is an issue for consumers.”

Brendish sees something special in the West Coast heritage. “It is almost more NZ than NZ and I think there is an opportunity to leverage off that.”

DAIRY NEWS MARCH 14, 2017

NEWS // 5

t gain for Westland Milk and I think the level of transformation required is probably the surprise.

“It’s a bigger job in respect of the operational efficiencies we have to get. Westland had a bad year last year, but when I

look back it was probably coming for a couple of years earlier in terms of operational challenges that haven’t been addressed.

“We have been making good investment

of strategic assets, but as far as the rest of the business is concerned we haven’t kept our pencil as sharp as we needed to for efficiency.” @dairy_news facebook.com/dairynews

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While China is an important market for Westland, Brendish says, so are Indonesia, South East Asia and the Middle East. The coop has made inroads into North Africa and is doing well off a small base in North America.

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Can Handle doing very well. I don’t expect we will finish the year at minus six but we are there now.”

She says the final payout range is $5.40-$5.80 – not much more than breakeven.

But big cost savings have already been made, e.g. better managing the mix of rail and road transport, saving the co-op several hundred thousand dollars.

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THE EFFECTS of an excessively wet spring and summer on the West Coast will see WMP’s production down on last year.

Toni Brendish says it is now running 6% below last season but she believes it may not be this bad by the end of the season “Traditionally we have a stronger autumn on the West Coast and Canterbury is flying. So when I look at the average, we are well down on the West Coast but Canterbury is

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ACCORDING TO Toni Brendish, WMP has made good decisions about where it wants to be, but hasn’t always put in the people capability to support that.

For example, the co-op put just one person into the huge China market, expecting them to build it up from scratch.

“It’s going to take time to do that. Many other organisations would say ‘ok if we going to make this investment we need to go big in the beginning to make sure we get it right’,” she says.

One flaw in the WMP China strategy was going into the market in all product categories.

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some may need help to get to that break-even number.

Brendish is an Australian who has worked in the fast moving consumer goods area for most of her career; most recently she worked for the French multinational Danone.

“When I started working for Danone, getting into infant formula, I understood nutrition and the impact you can have on people lives. That is the attraction.

“When I was first approached about this role the initial attraction was dairy, and the second attraction was the whole integration of the product from farm to plate -working with farmers and suppliers all the way through to delivering the product to consumers, and that was for me the attraction.”

During the interview process Brendish was made aware of the problems facing the co-op. The WMP board was upfront with her about the state of the company and wanted someone to ‘transform’ it, she says.

“I didn’t come in with rose tinted glasses.

The board told me they had made investments and these hadn’t been executed as well as they should have been. But there are always surprises

Westland Milk’s new chief executive Toni Brendish says shareholders are gutted at the co-op’s performance.

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DAIRY NEWS MARCH 14, 2017

6 // NEWS

Global trends favour co-op PAM TIPA pamelat@ruralnews.co.nz

FONTERRA IS maintaining its forecast guidance but with a note of caution on some emerging headwinds, director John Monaghan says.

“Lower volumes will impact price achievement in our ingredients business,” he told the Northland Dairy Development Trust annual meeting in Whangarei last week.

“We will be watching stream returns with whole milk powder and increases relative to cheese and other non-reference products.

“Consumer and food service will remain

focused on growth while maintaining gross margins.”

Fonterra will announce its half year results on March 22.

Overall the global dairy markets have come back into balance this year, he says.

European Union production slowed by 3% from September to November. Key milk producing countries contributed including the UK down 11%, France down 7% and Germany down 5%. Australia is down 7% for the 12 months to November.

“Farmers have adjusted production in New Zealand and weather conditions and grow-

ing conditions have been poor,” he says “On the demand side we have seen strong growth in two of our key markets – China and Latin America. In China whole milk powder imports in December 2016 were up 99% on the same month of the previous year.”

Reduced global supplies of milk have benefited Fonterra’s forecast farmgate milk price ($6/ kgMS).

“But we are not out of the woods yet. Based on milk collection data through to the end of January, we are forecasting milk volumes down 5% on the previous season.

That’s a slight improvement on our earlier fore-

cast of a 7% decline.

“The weather has improved in many regions following unfavourable conditions during the peak months,” he says.

The Northland drought impact has been factored into current forecasts.

Fonterra lifted its farmgate milk price to $6/ kgMS following improvement to global milk prices since December. “There have been a few minor bumps in the road since then but overall the sentiment remains positive,” he says.

“We will continue to monitor the global situation and as always if there is a good reason to change our forecast we will tell you.”

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Fonterra director John Monaghan addresses the Northland Dairy Development Trust meeting last week.

Every year Fonterra is increasing the milk volumes going into higher value products in its ingredients and consumer food services business, he says. All new milk produced by NZ farmers now goes straight into higher returning products.

“We talk now about volatility in global milk prices being the new normal. But this means opportunity for Fon-

terra,” he says.

“We have invested $1.5 billion in capacity since 2012, building new plant and creating more jobs in Waikato, Manawatu, Canterbury and Southland. This means we can be more flexible with the products; we make a switch to the products that are most profitable.

“Our new plants are highly efficient in quality and cost. We have

matched production in the highest value customer demand or taken advantage of reduced costs especially at the peak of the season.

“We were able to switch production away from the powders and related product streams of butter and anhydrous milk fat that make up the farmgate milk price while margins for these products were lower.”

DAIRY NEWS MARCH 14, 2017

NEWS // 7 Food service operations go from strength to strength, supported by the way Fonterra sells to this market segment, he says. “We target three areas: quick service chains like McDonalds, bakeries across Asia and China and companies specialising in Italian cuisine.”

While the higher forecast milk price has been good news for farmers, lower milk collection is still tough on farmers in some regions, notably Northland.

“We want to shift more volumes of milk into higher value products. We have a $35b revenue goal for 2025.” Food service alone will be a $5b business by 2023.

NZ cannot satisfy the total dairy market of 406b L and growing at 2.3% a year. Dairy demand is forecast to grow to 465b L by 2020. That is why their strategy includes partnerships in Australia, Europe, Chile and China.

“China is our largest market; it remains a land of opportunity. We are well positioned in this market with our Anchor, Anlene and Anmum

brands and our ingredient exports.”

Prospects are good, he says. “The countries that don’t have enough milk will always look to the countries that have more milk than they need to close the gap.”

We are the biggest in the globally traded market – a 66b L market growing at about 5% a year.

“That’s why we are optimistic about the future. Global trends are in our favour… more mouths to feed, urbanisation and growing incomes encourage greater dairy consumption. There are great opportunities from paediatrics through to active ageing trends to tap into with our dairy knowledge and market reach.”

He does not believe NZ has reached peak milk and there will be further advances in technology, breeding and onfarm practices. But the growth will not be the 4-5% of some previous years; long term they expect to see production growth of about 1%.

CHINA REMAINS A CHALLENGE BEINGMATE’S RECENT performance reflects China’s market conditions which remain challenging for all dairy players, says Fonterra director John Monaghan.

The long term outlook remains strong, with disposable incomes in China growing by 11.5% a year since 2006, the relaxation of the one child policy and brand regulations leading to the exit of many smaller competitors from the marketplace, he says.

“We are confident of our overall China strategy in which our Beingmate partnership continues to be an important part.

“Our partnership with Beingmate is long term investment to grow the domestic infant formula market. It also supports future ingredients sales of our NZMP brand from New Zealand and whey products from Australia and Europe.”

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formula brand in China grew from 60 cities in 2015 to at least 170 cities today. Total sales are also ahead of projection.

Beingmate’s annual result which was released this month will provide further information as required to assess the situation in detail, he says.

“We will include a thorough update for our farmers as part of our interim results when we do the shareholder meetings in late March.”

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More milk, less returns BANKS have revised their forecast payouts for the season following last week’s dismal Global Dairy Trade (GDT) auction results.

ASB rural economist Nathan Penny revised down its forecast to $6/ kgMS from $6.50/kgMS on the back of sliding Nathan Penny dairy prices. Westpac has revised its forecast, from $6.20/kgMS to $5.90/kgMS, slightly below Fonterra’s of $6.00/kgMS. A key catalyst for the decline in prices over the past fortnight has been better milk volumes out of New Zealand, says Westpac economist Sarah Drought.

Penny says given the improvement in local milk production, it was hinted that prices would correct before the end of the season.

Dairy prices fell 6.3% in this week’s auction, following a 3.2% decline a fortnight ago. Within this, powder prices have been under the most pressure, whole milk powder prices falling 16% over the past fortnight, including a sharp 12.4% fall last week.

At US$2782/t, whole milk powder prices are now back at the levels of October last year, although some are still 35% higher than mid 2017.

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DAIRY NEWS MARCH 14, 2017

8 // NEWS Susan Bell-Booth with the Mix Maker for teat sprays.

Innovation pitch for chance to help SUDESH KISSUN sudeshk@ruralnews.co.nz

FONTERRA IS working with innovation partners whose technology offerings can help farmers

manage their businesses better.

The co-op’s Activate 2.0 programme is designed to support this initiative. Run by Fonterra Farm Source, Activate 2.0 is a competition open to

A good start goes a long way.

third party innovators designed to help Fonterra’s farmers lower input costs, save time and/or increase productivity.

Earlier this month, seven innovators were invited to Fonterra’s head office in Auckland to pitch to judges.

Three finalists were chosen: Regen Ltd, Agrismart and Wikldeye; the winning entrant will be announced later this week.

Regen’s offering is an automated, science based, daily scheduling of recommendations for water and effluent, and a nitrogen use calculator, available direct to the farmer via a mobile app.

The aim is to make it easy for farmers to accurately manage water, effluent and nitrogen use so as to minimise water waste and nutrient leaching and save power and fertiliser costs.

Regen says its system also captures the on-field data and activity in report form for farm environment plans and audits, without the farmer having to manually do it all themselves.

Agrismart has developed people management software designed especially for the dairy industry to reduce breaches in paying the minimum hourly rate to salaried workers.

The timesheet software records the number of hours worked in a pay

period and then calculates and alerts the farmer if any top-up is required in that pay period, ensuring they pay the employees the correct amount.

Wildeye is offering a soil moisture monitoring device that optimises use of irrigation to support water-use obligations and ultimately reduce costs and raise efficiency.

The device measures soil moisture and displays it in the cloud with an intuitive interface. It allows farmers to make better use of their available water and know when the soils are too saturated for effluent management.

Wildeye says it is a simple, robust and affordable product for metering remote sensors that works ‘out of the box’.

Fonterra Farm Source chief operating officer Miles Hurrell says he is impressed with the new technology on offer.

“Farmers and those associated with farming businesses are demanding more,” he told Dairy News.

So Fonterra recently launched Agrigate to make the lives of farmers easier.

“We are keen to pool data from different sources and make our shareholders’ lives easy.”

He says Agrigate will work with the Activate 2.0 participants to help take the technology to the coop’s farmer shareholders.

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TAKING THE hassle out of mixing teat spray is the Mix Maker made by Saflex and now sold by Ecolab.

Saflex director Susan Bell-Booth, who took part in Activate 2.0, says it allows accurate dispensing of chemicals for teat spraying.

“It is accurate – not a drop more, not a drop less,” she told Dairy News.

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DAIRY NEWS MARCH 14, 2017

10 // NEWS

First woman head for Feds?

PETER BURKE peterb@ruralnews.co.nz

THERE IS widespread speculation about a con-

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challenged by Katie Milne, a West Coast dairy farmer and ‘member at large’ on the Feds seven member board.

Milne has just been elected deputy chairman of Westland Milk Products and is seen as being able to connect well with ordinary New Zealanders including farmers.

Feds’ dairy, meat and fibre and arable divisions all have members on the board, and in addition to the president and the vice president there are two members at large.

Crofoot confirms he will stand for president, and the dairy chair, Andrew Hoggard, confirms he will make a bid for the vice president slot to be vacated by Crofoot.

But Feds is rife with speculation that Milne will make a bid for the top job. She hasn’t confirmed this outright, but says she hasn’t ruled it out and that June is far away.

Should she stand and win, she would be the first woman president.

Crofoot is highly respected in farming and renowned for being an innovative farmer who has turned around his farm, Castlepoint Station.

He is known for business skills, supporting and applying science and as very likable.

But there is a move by some provincial presidents, who elect the new board, for wholesale changes at the top level in Feds, given the ups

and downs of the past three years. And there are also suggestions it may be time for a dairy farmer and a woman to take on the top role. The last three presidents – Nicholson, Wills and Rolleston -- have been sheep and beef men.

The other option would be for Milne to seek the vice presidency under Crofoot and for Andrew Hoggard to stand for member at large succeeding Milne.

But should Milne win the presidency, that would pave the way for Waikato dairy farmer and Feds Waikato dairy chairman Chris Lewis to join the board as the new dairy representative, while the present deputy of meat and fibre, Miles Anderson from Timaru, could make it to the board table, but again there could be other contenders in the wings.

What happens in the member at large vacancy is anyone’s guess.

Three years ago there was simple transition for all the top spots, but six years ago in Rotorua skin and hair flew behind the scenes, ending up with Bruce Wills taking the chair.

As Milne says, June is a long way away, but some people in Feds are known to be counting down the days and are seeking transforming change to boost the wider profile and credibility of the organisation. @dairy_news facebook.com/dairynews

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Katie Milne

test for the presidency of Federated Farmers at its annual meeting in June.

The three year term of the current president, William Rolleston, ends

FONTERRA’S TRADE stand at the world’s largest food show won a top innovation award.

On the stand were NZMP (dairy ingredients) and Anchor Food Professionals (foodservice brands).

The Gulfood Innovation Awards in Dubai are made for new and improved products and technologies among those shown by 5000 food, beverage and hospitality companies that exhibit.

Fonterra general manager Middle East for NZMP, Santiago Aon, says the co-op brought “the Fonterra experience alive” for visitors to the stand, for example, by the Fonterra “virtual reality experience”.

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DAIRY NEWS MARCH 14, 2017

12 // OPINION RUMINATING

EDITORIAL

Getting our priorities right

MILKING IT...

Strike two ANOTHER PALM kernel expeller (PKE) shipment, another shipping fiasco.

A ship loaded with PKE from Indonesia was last week ordered to leave New Zealand within 24 hours after MPI divers found dense fouling of barnacles and tube worms on its hull and other underwater surfaces.

Last year a shipment of PKE was rejected because it was sourced from an unapproved facility.

Hats off to the Ministry of Primary Industries and its biosecurity team.

Ban quads – doctors

Wild about oats?

Free-range craze

DOCTORS WANT the New Zealand and Australian governments to ban the use of quads by children.

This follows the death of a six-year-old girl in New South Wales who died after a crash on a quad driven by a 13 year old. This took quad crash toll in Australia to 115 since 2010.

The doctors say this latest tragedy sadly resembles the many crashes that occur in NZ every year.

They want a ban on children under 16 riding quads.

But quads have been part of farm life for decades. Will a ban work?

YOU’VE HEARD of soy milk, almond milk and even cashew beverages; now oats is fast becoming a non-dairy milk contender.

Drink your porridge, perhaps?

Canadian entrepreneur Jackie Nguyen, 39 is behind the venture.

Since Christmas 2016 oat ‘milk’ has been offered by small retailers in Toronto city; Nguyen produces about 100 bottles a week. His four flavours – oat, cinnamon, cinnamon cashew oat and chocolate cashew oat – are neutralhued beverages, poured into slender, glass bottles with labels designed by a local artist.

THERE’S A moove to more cow-friendly milk; you can buy it in northeast England.

A leading supermarket, Asda, says it will stock dairy farmer’s free-range milk. Its store at Gosforth, Newcastle, will sell the product, prompted by a celebrity chef saying there was not much choice.

Customers had responded to Jamie Oliver, on a TV food show, drawing attention to the milk choices available.

Free range dairy farmer’s milk comes from pasture farms where cows are guaranteed 180 days and nights outdoor grazing a year.

Something for NZ milk exporters to ponder?

THE GOVERNMENT’S recent announcement that it wants 90% of New Zealand’s lakes and rivers meeting swimmable water quality standards by 2040 has put the issue back into the limelight.

And when water quality becomes the focus, it’s the dairy sector that becomes the favourite punching bag of lobbyists.

Water quality has always been the big focus in NZ and most farmers are well aware of this.

And as Feds dairy president Andrew Hoggard puts it, “it is vitally important every farmer is doing the basics well here –waterways fenced and effluent well managed.” Going beyond that, it’s being aware and understanding what is the state of your local waterways, and what you could do about improving or safeguarding them.

One clear goal he says the industry and individual farmers should have is total prevention of harmful levels of faecal contaminants entering waterways. Most dairy farms are likely already very close to that, but it shouldn’t be a goal only for dairy farmers but for all.

Have we got our priorities right?

What we are concerned about in NZ environment-wise isn’t necessarily what the rest of the world is so concerned about.

Overseas more emphasis is placed on climate change and biodiversity. So dairy farmers here need to think what this might mean for the future.

Another issue hitting farmers is animal welfare.

Hoggard points out that despite the noise, we have a world leading regulatory framework. However, as competition gets tougher, when we trumpet our free range, pasture fed status, expect to get questions about shade and shelter, he says.

Then there is worldwide concern about antimicrobial resistance; greater emphasis will fall on the proper use of antibiotics in farming and, again, NZ is world leading in low use of antibiotics.

However, our customers won’t want to know just what the averages are, they will want to see best practice on all farms they buy from. Best practice means correctly identifying the illness, and treating with the appropriate drugs, and that critically important antibiotics are used only where first line treatments are not sufficient.

Hoggard questions whether every person onfarm in NZ, making treatment decisions on livestock, is well enough trained, formally or informally, about treatment choices; in the future that is likely going to need to change.

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DAIRY NEWS MARCH 14, 2017

OPINION // 13

Politics and science had better heed the truth Federated Farmers president Dr William Rolleston spoke on global trade and its impact on farmers at the Feds’ national council last month. Here are excerpts from his speech.

THE WALL Street Journal noted that 57% of Trump voters thought trade takes away jobs.

The Rust Belt of the USA, where auto and steel jobs have been lost, will find that those jobs have gone not so much because of trade or immigration but because of technology.

Ironically, robotics and automation are allowing developed countries to bring manufacturing back home but the jobs won’t be coming with them.

A Trans Pacific Partnership which includes the USA has gone for the meantime but I would not write off its long term prospects.

The TPP took more than ten years to negotiate. A presidential term is four.

Thankfully the flurry of executive orders has not yet included trade tariffs on Chinese and Mexican imports. Perhaps the president is starting to listen to the advice that such tariffs will only hurt his own consumers and a trade war would be crushing for US farmers.

New Zealand needs to hold the line in our trade with the US and make small gains where we can, but any trade deal, in my view, can wait. ‘America first’ is not a good pretext for a balanced outcome.

We will also have to be careful not to be caught in the crossfire of any trade war, and the Government and our officials need to play their cards skilfully and tactfully. There are opportunities in disruption.

If there is any area of government which needs investment priority right now it is our trade division. We cannot afford the things we want and need, like hospitals and social services, if we cannot earn our way in the world.

Four days before the North Canterbury earthquake I was at a Cairns Group meeting in Geneva.

I presented the NZ farmer view of the importance of free trade and the positive outcomes of deregulation.

I noted the dulling effect subsidies were

having on the dairy supply response. I described the volatility in international prices caused by a thin market exacerbated by restrictions on trade such as tariffs and non-tariff trade barriers.

We also heard from professor Kym Anderson, School of Economics, Adelaide University, on the barriers to, and trends in, free trade. Developing countries, he said, had until recently restricted exports through penalties such as export tax.

Argentina farmers, for example, were penalised with an effective tax rate of up to 90% on their exported goods. It seems bizarre to us but the intention was to flood the local market with cheap product. The reality was that Argentina had less ability to pay its way.

Its new government is reversing this policy and other developing countries are now starting to apply subsidies to stimulate production just as developed countries are reducing theirs.

Another emerging barrier to trade is the environmental penalties applied by governments in developed countries, such as ours, which, if based on production, have a negative impact on competitiveness and disrupt world trade.

Just like export taxes, these penalties reduce a country’s ability to pay its way and perversely to afford the environmental interventions it desires.

Some political parties here in NZ continue to be fixated on penalising NZ farmers in just this way through including biological emissions in a carbon tax or the ETS. What is worse, since we are carbon efficient protein producers, any penalty will simply be exporting production to other less efficient players, making the global environmental problem worse, not better.

Our decision makers need to resist post factual science and pandering to fear. Our local councils appear to be particularly

vulnerable in this respect.

The problem for us is that once rules are notified in regional and district plans, the burden of proof

to have them removed can become insurmountable.

Councils need to realise that they have to work with farmers if they are to

effect change; they must sort out fact from fiction early on and set out with rules which are practical, doable and evidence based.

Dr William Rolleston.

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DAIRY NEWS MARCH 14, 2017

14 // AGRIBUSINESS Fonterra’s Anchor Food Professionals programme targets chefs in Thailand.

Growing middle class opening new doors A GROWING urban middle class in Thailand – the second largest economy in Southeast Asia – is opening new doors for Fonterra.

The managing director of Fonterra Brands

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Thailand, Paul Richards, says the country’s maturing economy and growing urban middle class presents the co-op with a huge opportunity.

Thailand’s population is at least 67 million.

“Thailand’s transition from an agriculturebased economy into a knowledge-and-skillsbased economy has led to an increasingly urban and affluent population, which is… eating out of home and on-the-go more often”.

While Thailand’s overall dairy consumption is still relatively low (26.6L/person/year) compared to Singapore (61L) and New Zealand (272L), it is much higher than many other Southeast Asian markets and is growing rapidly.

Thailand has traditionally been a milk powder, condensed milk and evaporated milk market, Richards says.

The co-op has sold WMP, SMP, BMP and AMF to Thailand since the 1950s.

“Today we’re [meeting] increasing

business Anchor Food Professionals sells dairy products to 3500 food and beverage outlets across the country each year.”

Convenience stores sell about one third of all fast-moving consumer goods in Thailand; the number of stores is forecast to grow at 12% each year until 2020.

“This is a channel we’re focused on,” Richards says. “With strong brand presence in this channel we’ve been able to expand our geographic footprint into large towns and tourist areas quickly.

“We’re partnering with key convenience stores to develop new menus and products.”

For example, the co-op worked with 7-Eleven to create Carbonara Sandwich and Chocolate

“We’ve been capitalising on the trend of increased mobile dining.”

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customer demand for cheese, UHT and pasteurised ready-todrink milks, drinking yoghurt, yoghurt and flavoured milks.”

NZMP South and East Asia regional account manager Kimble Willis says the co-op is selling higher value ingredients such as protein, cheese and powders into the strongest growing dairy segments.

“Customers are increasingly demanding specific benefits in their ingredients…. For example, in sweet whey powder we have created additional testing and specification limits in our NZ facilities to meet Thailand’s regulations and match customers’ applications.”

Richards says there is huge potential in valueadded dairy products as more Thai consumers with higher incomes demand greater variety, convenience and westerninfluenced options.

“We’ve been capitalising on the trend of increased mobile dining. Our foodservice

Toasties, and launched two new flavours of Anlene Gold UHT and Anmum UHT milk for the first time in 7-Eleven.

The 7-Eleven listing resulted in a 56% growth in UHT sales in 2016 versus 2015.

The co-op says rising incomes and better education have led to an increased awareness about the nutritional benefits of dairy, hence the co-op growing its advanced nutrition category, which contains the Anlene and Anmum brands.

Anmum is said to hold the number one position in the market, maintained through new formulation and product developments. For example, Anmum’s latest formulation Anmum Materna Probiotics DR10, which supports the digestive system, was developed after speaking to pregnant women concerned about constipation.

Recent new Anlene flavours have included UHT English Malt and Spring White Tea.

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DAIRY NEWS MARCH 14, 2017

16 // MANAGEMENT

OAD attracts many explorers What’s happening with once a day (OAD) milking now, following the death last year of its great advocate professor Colin Holmes? Reporter Peter Burke went to a OAD field day in Manawatu recently to find out.

THE DAY was beautifully fine, a rarity in this region for many months whose never-ending spring has brought little sun, only rain or cloudy windy days.

Whether it was the fine weather or the general interest in OAD, 50 farmers from the lower North Island attended.

The field day was held

at a farm owned by the Finnigan partnership.

Christine Finnigan has run a OAD operation in Manawatu for eight years and the family bought the

farm at Linton where a field day was held a year ago. Christine’s son James and his wife Hannah are running the property as a OAD farm.

The milking platform is 115ha of which 90ha is owned by the Finnigans and a further 25ha is leased. As well they lease

extra land as a runoff block. At present 310 cows – a mix of Jersey and Kiwi Cross -- are run on the property and they are targeting 100,000kgMS this season.

But Christine Finnigan says it hasn’t been an easy year.

“We had a tough spring

A good start goes a long way.

like everyone else. The wet was horrific and it hasn’t stopped raining until about two weeks ago.

“We haven’t had more than three days sun for ages but it seems we may get a bit more in the coming days.”

With the wet, windy and cloudy weather has come slower than normal pasture growth rates. Christine Finnigan says OAD farmers face the same challenges as those on twice a day (TAD) -- poor utilisation of pasture. But things are picking up now.

The wet winter and spring and even summer have highlighted a problem on the farm which James Finnigan is in the process of solving – drainage.

James was brought up on a dairy farm and did work on one in the Tararua district before taking on this property. But he says this one with its

heavy clay soils is much wetter. Since coming on the farm he’s been working on improving the infrastructure.

“We’ve redone a lot of the races, redone the effluent system plus fencing and water and have put drainage in. We have about 10ha in crops and we had planned to do a bit more but with the season it didn’t work out.

Local farmer Hamish Raleigh does the mole ploughing.

THE MOLE PLOUGH

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CARRYING OUT the mole ploughing operation is local farmer Hamish Raleigh. He specialises in this type of work and says it is quite commonly used in Manawatu.

Before the mole plough is used, a series of bigger drains are dug across a paddock which will ultimately take the water to an even larger drain.

These drains are normally dug at 40m spacings but on the Finnigan property they are at 80m to save time and money and to do more paddocks.

The mole plough – a blade to open up the soil and a plug or mole to make a small drain – is dragged behind a bulldozer. The bulldozer is used, says Raleigh, because it is slow and powerful and creates a perfect small drain.

The small mole drains take the surface water into the larger drains or trenches filled with metal and Novaflex and these then feed into the larger farm drain.

“It’s pretty simple and we have been doing it for hundreds of years. It’s something a lot of people don’t know a lot about really and it seems to have dropped off the radar.”

Raleigh says in that situation there is risk of the mole drains being sealed off by the compaction of the cows.

DAIRY NEWS MARCH 14, 2017

MANAGEMENT // 17

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James Finnigan likes once-aday milking because it gives him flexibility.

We are doing another 4ha of grass now and we have turnips but they are pretty average, and one paddock of chicory plantain mix,” he says.

James says he likes OAD because of the flexibility it gives him as farmer.

“It helps free up time and you can go do a job and come back and milk

the cows in the afternoon.

It’s also better and less stressful for the cows and we don’t have any sick cows.”

The farm is now somewhere between system two and three; cow numbers have been cut from 340 to 310.

Finnigan says he is able to call on his mother Christine for advice and

they also employ a consultant, Scott Ridsdale, to give advice. But right now his focus is on improving the drainage on the farm which he says is the major issue. The soil has become compacted and sealed over and he’s now installing a new drainage system using a combination of Nexus Novaflo and mole drains.

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in the lower North Island, James Muwunganirwa, says there is evidence to suggest that OAD is gaining in popularity. He says the main reason is the desire to have a better work/life balance.

But some people are looking at it with a view to improving the reproductive performance of their cows and getting them in better condition and reducing empty rates.

“The number of people inquiring about OAD and the people coming to this group have been slowly building up. We have people here who are milking TAD but have come to learn a little bit more about making the move to OAD,” he says.

One of those people was Mark Hooper from Lepperton in Taranaki who is just in

his second season of full time OAD. He runs 320 Kiwi Cross cows on a low input operation and is targeting 100,000kgMS this season.

He says it hasn’t been an easy season with the weather and dairy downturn but he’s in OAD for the long haul and can see the benefits to his operation. Hooper says the OAD group is a great help.

“Despite the fact that we don’t have Holmes anymore there is a good vibe and good momentum and I think it will remain a strong interest group. The fact that we have Massey University involved with No 1 Dairy is also a good drawcard,” he says.

Christine Finnigan agrees and says she’s had inquiries from Bay of Plenty asking for advice on setting up a OAD group there.

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DAIRY NEWS MARCH 14, 2017

18 // MANAGEMENT

Make it a successful harvest ADAM CLAY

IF YOU’VE ever wondered why maize silage is such a good fit with New Zealand systems you’ll need to understand that the rumen is a microbial environment, full of bacteria, fungi and protozoa

Maize silage can offer high levels of home grown starch which when fed accurately can boost production and help profitability.

As we begin to enter the maize harvest season, attention to detail is required to ensure farmers not only harvest, but

which eventually help to produce milk or weight gain.

High protein levels in many forages fed in NZ must be balanced by energy and, more accurately, specific types of energy to increase utilisation of the protein and optimise performance.

hold onto the benefits a crop like maize silage can bring.

This season has been a perfect reminder of how changeable NZ weather can be, and that it can present a big challenge to achieving perfect harvesting conditions, particularly for maize silage

which has a short harvesting window. Having a plan pre-harvest can help to minimise disruption and achieve the best possible outcome.

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tractor, nutritionist or consultant. The result must be that the farmer has access to the highest quality feed that suits their system requirements. Ensuring every member of the team has a specific responsibility can help cut out any ‘what ifs’ post-harvest.

Farm requirement is the first question to be answered, knowing that can help to apply responsibilities during the harvest. For example, when will the maize be fed out? If it’s for early-lactation cows then it may be important to maximise starch content, requiring a more mature crop at harvest. Alternatively, the crop may be destined for a beef unit, or a higher feed-rate dairy unit where a longer chop may be a pre-requisite for improved rumen function.

■■ Individual circumstances will have an influence on the final decision, so it’s worth considering the following key points to establish a plan, and to understand who has responsibility ■■ Pre-harvest dry matter check: helps to determine harvest date ■■ Supervising chopping: who makes the changes based on the following measurements ■■ Measuring daily dry matter: can affect packing quality and starch digestibility ■■ Check chop length: longer chop may be more difficult to pack but may be needed by the cow ■■ Measure and record particle size distribution with Penn State separator.

■■ Monitor kernel processing: if changes are needed, report back to chopper driver ■■ Apply a proven high quality inoculant, to encourage faster fer-

mentation and/or to minimise heating losses during feeding out.

■■ Supervise packing of the stack ■■ Measure stack compaction ■■ Take sample for lab analyses ■■ Supervise fast and effective sealing of the stack post-harvest including using an oxygen barrier sheet.

Of course, the leading question each season is, what is the right harvest time?

High forage quality drives intake and, in turn, this drives production.

Not even the best nutritionists can make cows maximize their milk production if they are working with poor quality forages.

Maize silage should be harvested when the whole plant is at about 35 % DM. Depending on the conditions, corn plants will dry at a rate of about 0.5% day, or even faster in dry and hot weather. Based on your acreage and equipment there might be a need to start harvesting at a lower DM, and you may end at a higher DM, but the key is to avoid the extremes.

Harvesting maize silage that has a DM of less than 28-30% will result in excessive fermentation likely to produce high concentrations of total silage acids and result in excessive seepage losses. Specifically, these wet silages are often characterised by high concentrations of acetic and butyric acid produced from ‘wild’ fermentations.

Feeding large quantities of wet maize silages tends to lead to a reduction in DM intake because of the high acid content.

• Adam Clay is ruminant and forage product manager, Nutritech International Limited.

DAIRY NEWS MARCH 14, 2017

ANIMAL HEALTH // 19

Irrigation NZ project manager Steve Breneger (right) addresses the Lincoln Uni Demonstration Dairy Farm open day.

High empty rates blamed on virus NIGEL MALTHUS

DAIRY FARMERS are

being warned to keep a lookout for a common virus which may be becoming more virulent in New Zealand herds.

A continuing high herd empty rate is puzzling the Lincoln University Demonstration Dairy Farm, and some suspicion is turning onto IBR (Infectious Bovine Rhinotracheitis).

Manager Peter Hancox told a gathering of 300 at the farm’s February 23 focus day that the empty rate was 9% this spring, versus 14% last year.

“It’s an improvement but it’s still not where we want to be. We’re struggling to know why.”

Donald Arthur, of Selwyn Rakaia Vet Services, told the open day the disease struck the LUDF herd in the first week of November, when several two-year-old milking heifers

presented with very high temperatures, mild coughs and discharges, the worst affected being “right off their milk”.

“We believe it was going through the herd about the time we were trying to get the cows pregnant. Particularly it seemed to be affecting the two year olds.”

However, the possible link was not clear, some of the empty cows having tested positive for IBR and others negative.

IBR is a type of herpes virus, common in NZ although local strains usually appear mild compared with overseas, where abortions and encephalitis due to IBR have been recorded.

Arthur says it is generally quite innocuous.

“But we are starting to see episodes like those we’ve seen at Lincoln.

I don’t know whether more pathogenic strains are emerging or whether

they’ve always been out there and we’re recognising them.”

Arthur says that as a virus there is no treatment for the primary disease but plain white penicillin is useful against secondary bacterial infections.

Vaccination rates had been higher 20 years ago but had fallen, in part because animals testing positive for IBR could not be considered for the China export market.

“It’s something to be aware of, something that could affect herd performance, and it could even impact young stock growth as well if they get it bad enough.”

The LUDF herd is now vaccinated against IBR but Arthur is reluctant to suggest all farmers should vaccinate.

“Watch this space; if we are seeing the emergence of more pathogenic strains maybe we will have to consider it,” he says. @dairy_news facebook.com/dairynews

Donald Arthur, Selwyn Rakaia Vet Services, (left) talks about IBR virus outbreak with farm manager Peter Hancox.

DAIRY NEWS MARCH 14, 2017

20 // EFFLUENT & WATER MANAGEMENT

Remind inspectors about farm safety SUDESH KISSUN sudeshk@ruralnews.co.nz

DAIRY FARMERS bracing for unan-

nounced visits by Waikato Regional Council staff are reminded by a Feds spokesman to enforce health and safety rules onfarm.

Federated Farmers Waikato dairy chairman Chris Lewis says farms are nowadays considered dangerous workplaces under the Ministry of Business and Employment health and safety rules.

He says WRC staff or any other person cannot just “barge onto the farm”.

Visitors have to report to the farm office, where the farm hazards will be pointed out to them before they walk around.

“WRC staff can turn up unannounced but they have to report to the office where farmers should explain the hazards on farm before allowing them

to inspect effluent facilities,” Lewis told Dairy News.

Council staff are beginning a limited series of unannounced visits to Waikato dairy farms to check rates of compliance with effluent management rules.

The rules are designed to protect the health of waterways in particular from contaminants in effluent.

“100 unannounced visits will be carried out any time from now so we can compare compliance rates for announced and unannounced visits,” says farming services manager Nicole Botherway.

The background to these latest visiting tactics is the council’s former use of a helicopter plus unannounced visits.

Within the last few years the council switched to announced visits in a new approach intended to get council staff working one-on-one with farmers to make any necessary improvements to effluent management systems and ensure compliance.

Farmers responded positively to that but some were critical, saying announced visits gave farmers opportunity to cover up bad practices.

Following that criticism, staff gained council approval late last year to do 100 unannounced visits around the region over several months to compare compliance rates of farms receiving announced inspections and those getting unannounced visits.

“We’ll now be getting on with those unannounced checks and hope to be in a position to report back to the council by the end of the calendar year on what we find,” says Botherway.

Lewis says farmers in Waikato have done an outstanding job in getting top on top of effluent management.

“It’s a much different scene on dairy farms now than 10 years ago when it comes to effluent management.”

Farmers have invested heavily in new effluent systems; Lewis has spent $300,000 on his.

“It’s still a work in progress and we

Federated Farmers Waikato dairy chairman Chris Lewis.

are on the way to making it a perfect system.”

He says on any farm where the WRC finds defects it should speak one-onone with the farmer to sort it out.

“I believe if there are any defects found it will be mostly related to incomplete paperwork.”

Botherway says the council appreci-

70%

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60% 50% 40%

OR

30% 20% 10% 0% -10%

ates the work many farmers have done, in consultation with council staff, to lift their management of effluent and protect the environment.

“This sort of cooperation can make a significant difference to our waterways; farmers who’ve invested in boosting their environmental performance deserve much credit.”

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DAIRY NEWS MARCH 14, 2017

EFFLUENT & WATER MANAGEMENT // 21

Halo system can be a farm’s guardian angel THE MAKER of the Halo effluent mon-

itoring system says it frees up farmers’ time and ensures they stay compliant.

Tag IT Technologies Ltd was one of seven companies displaying their latest offering at Fonterra’s head office this month during Activate 2.0, a competition organised by Fonterra to promote onfarm innovation.

According to Tag IT, the Halo system is a service to help farmers primarily measure, monitor and manage their effluent systems. Halo monitors conditions such as storage pond level, application amounts, pump and stirrer status. It sends alerts to a cellphone, smart phone or computer if a preset condition exceeds a limit or a fault occurs; it reports status directly to a cellphone, smart phone or computer.

A website and key information shows graphs and statistics for analysis.

Farmers have command and control through their phone or a web dashboard, with local controls onfarm as a backup The company says Halo gives farmers peace of mind by alerting them when a

pond nears freeboard levels.

“The days of setting up an irrigator and then going back to the pump to turn it on are over. Halo allows you to control the pump from your phone; you can press go as soon as you have positioned the irrigator.”

The Halo system helps to achieve compliant nitrogen levels, flow rates and volume, and it provides proof of placement and GPS monitoring or irrigators.

Halo can connect to weather systems, water pumps, silos and other farm systems.

Tag IT offers onfarm telemetry that support resource consent requirements.

“The monitoring systems we provide give stable and trouble free operation; products we supply are still in operation after many hours of cumulative field operation.

“All our systems will record and log information in a secure environment, provide secure access control and notify you if an alert condition is present and, more importantly, put you in control of this core function onfarm.”

Tag IT says its Halo effluent monitoring system ensures farms stay compliant.

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Farmers back healthy rivers proposal OTOROHANGA DAIRY farmer Laurie Pottinger says good work in the fencing of waterways has noticeably improved water clarity in catchments.

Pottinger supports work led by the Waikato Regional Council to improve the water quality in the Waipa and Waikato rivers.

Submissions for the Healthy River Plan Change closed last week.

“As a farmer I feel comfortable with the Healthy River Plan Change. I am making a submission as I feel there are several small improvements that can be made,” says Pottinger.

She says the collaborative stakeholder group (CSG) process has proposed a responsible solution addressing the main four contaminants in the river.

“The issues on nitrogen, in my view, are more about protecting the long term health of our water.”

“The CSG has taken a responsible stance on the nitrogen issue with the upper quartile of nitrogen leaches having to achieve lower levels below the 75th percentile. True grandparenting would have rewarded the extreme end of nitrogen loss farmers.”

The CSG process is giving farmers a comprehensive understanding of what the contaminants are and where they are coming from.

“Knowing this allows everyone to contribute to the solutions. For example, for phosphate it has been identified that 45% comes from farms -- all farms,

not just dairy -- while 18% comes from point sources (industry and town sewage, with Hamilton’s sewage pipe contributing 6.7%).”

DairyNZ’s Adrian Brocksopp worked with Waikato farmers to inform them about the proposed regulations. 115 farmers at eight recent district meetings organised by DairyNZ learned how to make submissions, and contribute to a DairyNZ submission being made on behalf of all Waikato dairy farmers.

“These farmers know what the implications are for their farms and businesses, and they want to be heard on their concerns and opinions. We’ve worked with them on the content of their submissions, and guided them in their writing.

“They know they need to participate in discussions about what happens in their own back yards, and when it happens.

“It’s important that all farmers say how the proposed plan could impact their business and community, and put forward alternatives so they can meet the outcomes the plan is looking to achieve.”

The farmers met at Otorohanga, Te Awamutu, Tokoroa, Cambridge, Ngakuru, Gordonton, Tuakau and Ngatea.

Brocksopp says the district meetings follow events pre-Christmas when 850 farmers were introduced to the proposed regulations and the national policy on baseline contaminant levels for nitrogen, phosphate, sediment and E. coli.

A total of 46 meetings were held during the last two and a half years.

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DAIRY NEWS MARCH 14, 2017

22 // EFFLUENT & WATER MANAGEMENT

Cash grant a boon to water scheme SUDESH KISSUN

The Hunter Downs Irrigation Scheme has received $1.37 million.

sudeshk@ruralnews.co.nz

A FARMER and community led

irrigation scheme has secured $1.37 million funding from the Government.

Crown Irrigation Investments Ltd has granted development funding to Hunter Downs Water Ltd (HDW) to progress its project.

Primary Industries Minister Nathan Guy explains: “This development grant funding will be used by Hunter Downs Water to complete the next stage of its programme as it works toward becoming construction ready.”

The Hunter Downs scheme will have capacity to irrigate 21,000ha in an area located between Waimate and Timaru in South Canterbury.

Guy says the grant is an important step for the project which could have major benefits for South Canterbury.

“The environmental and recreational benefits from this project include increased flows in surface waterways and in the Wainono Lagoon, protection of mudfish habitats and improved game bird and trout habitats.

“Irrigation schemes in other regions

have brought real economic and environmental gains. A reliable source of water gives certainty to farmers and growers, and helps them plan ahead and deal with droughts and dry spells.”

The scheme has been granted consents with rigorous environmental protections and will support a variety of land uses including beef, arable, horticulture and dairy. Water will be available for town supplies in Timaru and Waimate.

All decisions by Crown Irrigation Investments are made by an experienced, independent board. Strict conditions have to be met including sound governance and matched

funding.

HDW aims to begin construction on the Morven Glenavy Ikawai Irrigation Company (MGI) canal this winter, for commissioning in spring 2019.

The scheme on the supply of alpine water from the Waitaki River via MGI’s canal and mainline infrastructure.

Murray Gribben, chief executive of Crown Irrigation, says the grant will pave the way for economic, agricultural and environmental benefits for the region.

“Work on this project has been going on for a long time; the scheme has benefited enormously from 10 years collaborative work by Meridian

Energy and the Hunter Downs Irrigation Scheme Trust. HDW was established in 2013 and is a farmer and community led project.

“Irrigation schemes have added significant economic and environmental benefits to local regions and the New Zealand economy in other parts of the country and the Hunter Downs Water Project should deliver significant resilience to the local economy.”

Crown Irrigation funds development and construction of irrigation schemes nationwide.

The money helps support (through matched funding) the development of irrigation infrastructure proposals to the stage where they are ready for construction, which means they must be commercially robust and be well supported by their communities.

RELIABLE SUPPLY THE HUNTER Downs Irrigation Scheme is the outcome of ten years work bby Meridian Energy Ltd and the Hunter Downs Irrigation Scheme Trust (formerly the South Canterbury Irrigation Trust).

It will provide a reliable water supply for farms and commu-

nities between Waimate and Timaru from 2020.

The water will allow intensification of existing dry land farms and conversion to new farm types, with subsequent economic benefit and improved resilience for the greater South Canterbury region.

DAIRY NEWS MARCH 14, 2017

EFFLUENT & WATER MANAGEMENT // 23

Staged approach delivers on all counts A STAGED approach to

a comprehensive effluent system delivers on all counts, says a Kereone farmer.

“Staging various aspects is easier on your budget, especially in tough times, and doing the right thing at the right

2000m3 lined pond for the effluent from the dairy, and allowing pond water to be used to dilute the effluent from the herd homes (built in 2016) before it was pumped onto pasture.

“The pond has a fivedrum pontoon with float-

“Staging various aspects is easier on your budget, especially in tough times, and doing the right thing at the right time ensures compliance.” time ensures compliance,” Geoff Irwin says.

Irwin called in Hi-Tech Enviro Solutions in 2012 to solve a storage issue on his 270 cow farm.

“I didn’t have enough storage and wanted to resolve this before it became a compliance issue. I also wanted to limit the amount of rainwater entering the system and wanted to add a stone-trap which, with the additional storage, would make the overall system more flexible.

“At the time I was just wanting to store effluent from the dairy shed but I was planning to grow the herd to about 320 cows and build a couple of herd homes, so I wanted a system which would future-proof the farm.

“The result was a

ing pipe system which connects the pontoon to the shore, limiting access onto the pontoon and allowing me to move it around the pond for optimum pumping and agitation.

“The new storage system worked well but getting effluent out onto pasture was still a manual job which involved dragging lines from paddock to paddock.

“I also had an issue getting effluent to the back of the farm so in 2016 Hi-Tech designed and installed a 1.6km hydrant line which enabled fertiliser to be easily and quickly spread across the entire farm.

Trenching in the permanent hydrant line was a huge saving in time and labour.”

Geoff Irwin beside the hydrant line with the pond in the background

Irwin’s effluent system includes the five-drum pontoon with floating delivery, a vertical stirrer, 11kW Doda pump and a Cobra travelling rain gun.

“The Cobra achieves low application depths and rates but also spreads over large distances. It doesn’t have long boom arms so it’s easy to move around and set up.

“The entire system is cost effective, easy to manage and works well for us. Having a lined storage pond gives storage for when conditions aren’t suitable for applying effluent to pasture, and allows us to have more control and apply the effluent at the optimum time to maximise pasture growth and nutrient utilisation.”

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DAIRY NEWS MARCH 14, 2017

24 // EFFLUENT & WATER MANAGEMENT

Lake clean-up will hit farmers’ pockets SUDESH KISSUN sudeshk@ruralnews.co.nz

DAIRYNZ SAYS a plan

to manage nitrogen leaching in Lake Rotorua will hit dairy farmers’ pockets.

It has told the Bay of Plenty Regional Council that while the cost of mitigating nitrogen leaching varies from farm to farm, the mitigation is likely to require major farm system changes and may mean some dairy farms are no longer viable in their current land use.

The council’s proposed Lake Rotorua Nutrient Management Plan Change 10 (PC10) is part of a long term solution for

Lake Rotorua water quality developed under the Rotorua Te Arawa Lakes Programme.

To meet water quality standards set by the com-

tary land use changes purchased by the Lake Rotorua Incentives Board, 30 tonnes will come from voluntary gorse conversion to trees, and 50

“Over-regulating nitrogen leeching will not achieve the desired water quality objectives in the most efficient way.” munity, nitrogen entering the lake must reduce by 320 tonnes by 2032. Less than half of that -- 140 tonnes -- will come from proposed rules whereby landowners will need to change their land use.

One hundred tonnes will come from volun-

Nitrogen leaching into Lake Rotorua is being reined in.

tonnes will come from engineering initiatives.

But DairyNZ economist Carla Muller says it is possible that PC10 does not present the most costeffective way to achieve the community’s desired water quality objectives.

“PC10 requires dairy

farmers to significantly reduce nitrogen leaching. However, there is no requirement to reduce phosphorus losses.”

Nitrogen and phosphorus losses originate in fundamentally different processes, and the council has prioritised nitrogen management much higher than phosphorus management.

Muller says the deci-

sion about which nutrient to prioritise markedly alters the choice of mitigation.

“It is most cost-effective to select mitigations based on which nutrient is prioritised. Over-regulating nitrogen leaching will not achieve the desired water quality objectives in the most efficient (cost-effective) way.”

The council received 92 submissions from various individuals and groups such as farmers, Māori land trusts and industry and 20 more submissions based on

matters raised by initial submissions.

Council staff have now considered and responded to each point raised by these submissions and these are included in the section 42A report available on the Bay of Plenty Regional Council website, along with supporting evidence from council’s expert witnesses.

Council acting chief executive Fiona McTavish says the report highlights areas of Proposed Plan Change 10 where people are in agreement and topics or components of the plan change they

do not agree on.

“The report is a requirement of the Resource Management Act 1991 which responds to each submission and includes recommended changes to the proposed rules,” McTavish says.

The independent hearing panel will consider the recommendations in the report in addition to any evidence presented by submitters when making their final decision.

Public hearings are being held at the Millennium Hotel in Rotorua from March 13 to April 4.

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DAIRY NEWS MARCH 14, 2017

EFFLUENT & WATER MANAGEMENT // 25

Dairy effluent solutions!

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This simple but effective automated distribution system has a minimal footprint and needs no large ponds, it says.

The system starts with a patented Weeping Wall encased in a concrete lined bunker; the Weeping Wall removes the solids and allows the liquid to flow into a pump chamber.

Green water is then stored for recycling. Outside yards can then be automatically cleaned using floodwash or backing gate nozzles, effectively cleaning the yards without the use of fresh water; this reduces the water take from the

typical 50-70L/cow to 20-25L/cow. increasing pasture growth by up to Reducing water consumption 35%.”

No large ponds are required has a two-fold effect, the company says. “Firstly, it reduces the cost due to the 0.25mm application of freshwater extraction and depth, so storage requirement is filtration; secondly, it reduces the minimal.

The company says its system amount of effluent to be dispersed requires as little as two 30,000L to land.” water tanks to The Clean Green provide storage system allows liquid to Effluent can for greenwash be dispersed over large and effluent areas at the low rate be dispersed dispersed. of 0.25mm application safely most “The depth. Effluent can be days of the advantage of dispersed safely most year. the water tanks days of the year. is they are “As we can disperse effluent year-round at low guaranteed not to leak and have no application depths, there is no rainwater catchment. Rainwater nitrogen leaching and the pasture catchment in large ponds equates retains all nutrients provided, thus to doubling the amount of effluent

being stored and having to be dispersed by pump to land.

The Weeping Walls are designed to retain 12 months of solids. Removal of solids is done with a digger and chuck wagon. The solids retained in the system retain 100% of the organic nitrogen and a large percentage of the liquid nitrogen. This dry matter then becomes a slow release fertiliser suitable for crop planting.

“This cost effective system can be adapted to existing sheds or installed on new conversions.

Remedial work on large leaking ponds and non complying systems can be cost-effectively remedied by replacing with a complete Clean Green effluent system.”

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DAIRY NEWS MARCH 14, 2017

26 // EFFLUENT & WATER MANAGEMENT

Illegal discharges incur fines A FARMER and a family company

have been convicted and fined $65,750 for unlawful discharges of dairy effluent on two Waikato farms.

Ian Douglas Troughton and GT & AB Ltd were convicted and sentenced by judge David Kirkpatrick in the Auckland District Court for offences under the Resource Management Act. The discharges occurred between December 2015 and March 2016 at farms located at Patetonga and Turua.

The prosecution, brought by Waikato Regional Council, followed a complaint about effluent management practices on one of the farms in December 2015. A council inspection found that effluent had overflowed from a small sump flowing 130m across a paddock and into a farm drain linked to the Piako River.

The farm had previously been inspected in 2012 by the council and Troughton had been advised that the effluent storage was inadequate and at high risk of overflowing.

Council staff inspected another property owned

by Troughton in March 2016. A pipe was found to be discharging dairy effluent from an underpass directly into a paddock where it had formed a large pond. The effluent had also made its way to a farm drain linked to the Waihou River. Council staff told the farmer to clean up the effluent but he did not.

The council’s investigations manager Patrick Lynch says the inadequacy of the effluent management system on the first farm was clearly pointed out to the farmer some years ago but he elected to do nothing about it.

Farmers have important role to play – council ABOUT 900 landown-

ers in the Selwyn Waihora catchment in Canterbury would require a land use consent to farm by July 2017.

Environment Canterbury last month sent a package of information to many Selwyn Waihora farmers reminding them of their responsibility to meet nutrient management limits and to help them find out whether they will need a land use consent to farm this year.

The Selwyn Te Waihora section (Plan Change 1) of the Canterbury Land & Water Regional Plan, which became operative in 2016, introduced these

limits and outlined the time within which they would need to be met.

Selwyn Waihora zone manager Michaela Rees says many farmers are already doing the right thing or are on track to do so.

“They will need to apply for a consent to farm if their property is over 10ha and their nitrogen losses exceed 15kg/ha/year, and/or any part of their property is within the cultural or phosphorus and sediment areas,” Rees says.

“These areas are unique to the sensitive Selwyn Waihora catchment that drains into Te Waihora / Lake Ellesmere.”

Rees says there are several steps farmers needing a consent must take, and Environment Canterbury and industry bodies are available to help.

“Create a farm envi-

Key changes ■■

Farmers are required to reduce their nutrient losses. The timetable for this allows them to make improvements to their nutrient management while maintaining farm financial viability.

Where nitrogen loss rates are more than 15kg/ ha/year, from 2022 farming activities must reduce their nitrogen losses, in the case of dairy by 30%.

■■

A nitrogen loss allocation is available for the dryland irrigated by the Central Plains Water irrigation scheme.

■■

The role of drains in contributing nutrients, sediment and microbial contaminants to waterways and Te Waihora / Lake Ellesmere is recognised, and a stock access prohibition is extended to drains.

ronment plan, prepare a nutrient budget, apply for consent, have your farm environment plan audited and plan for further nitrogen loss reductions. All these steps will help address the serious water quality issues in our zone.”

Flows in lowland streams and the Selwyn River have decreased, nitrate concentrations

in shallow groundwater and lowland streams have increased, and the health of Te Waihora and local rivers needs improving.

“The whole community needs to address these issues and farmers have an important role to play. We are here to help them with community meetings, drop-in days and one-on-one discussions,” Rees says.

DAIRY NEWS MARCH 14, 2017

MACHINERY & PRODUCTS // 27

Turning back the clock MARK DANIEL markd@ruralnews.co.nz

GIANT SELF-PROPELLED forage harvesters are a common sight in paddocks, but wind the clock 55 years to 1962, when the Gehl 188 Chop King hit the country, and there must have been eyes standing out on stalks.

Spotted at the recent Northland field days at Dargaville, this example started its working days in Hawkes Bay before moving to Duncan Bros at Hautapu, Cambridge.

In 1997 it moved to Kaitaia, where owner ‘Gonk’ Bryan nicknamed it the ‘Gonkarator’ before handing it over to Wayne Bratten in 2006.

In 2010 it was donated to the Kaipara Vintage Machinery Club in a sorry state after a fire, and became a five-year restoration project led by club member Clyde McKenzie.

Today the machine is fully restored to working condition after many hours of work, particularly on the electrical and hydraulic systems. It comes complete with a grass pick-up, two-row maize header and a direct-cut head.

Said to be capable of harvesting about 2ha of grass or 0.8ha of maize per hour, the machine is a far cry from today’s goliaths, but would have seemed a beast compared to the more common direct-cut trailed machines.

One of only 100 examples built between 1962 and 1966, and thought to be one of only four surviving in the world, the fully restored machine will be on display at the Kaipara Machinery Club ‘Crank Up’ at Dargaville on April 1. @dairy_news

facebook.com/dairynews

Tidy discharger

Gehl 188 Chop King at the Northland field days.

MIXER WAGONS have always struggled to deliver the completed ration into troughs, because their layout causes the mix to be dropped onto a front- or rear-mounted conveyor and normally onto the floor or a low feed trough.

The latest offering from Kuhn, aptly named Flexilift (above), exhibited at the recent SIMA show in Paris, has a telescoping discharge conveyor able to feed from a maximum height of 1.2m or right down to ground level.

The conveyor is designed to keep the overall width to a minimum; it can be retro-fitted by dealers on the left or right of the machine, allowing the opposite side to discharge the load in the normal manner.

Availability is from September for all models of 12-34m3 capacity.

-- Mark Daniel

DAIRY NEWS MARCH 14, 2017

28 // MACHINERY & PRODUCTS

Variant gets a large tick TRACTOR MAKERS routinely submit trac-

tors for testing and review, but its much less common for machinery.

So it’s interesting to see that harvest specialist Claas recently handed its new Variant 485 RC-PRO to the German Agricultural Society (DLG) for a series of practical tests.

These included application checks, practical harvesting of grass silage and straw and handson operation by farmers.

The testers were impressed by the overall performance of the baler -- travel speed of 3.6km/h, seven knives engaged and maximum bale density in grass silage of 449.4kg/m3 at 38.3% dry matter.

The DLG test team also noted uniform bale density, from a firm core to the outer layers.

The new Claas Variant 400 series embody several detailed design changes to improve crop flow, bale shape and bale wrapping

Stop wastage – reduce pasture damage

functions. Field testing showed the machine was baling about 40.4 tonnes of grass silage per hour at a travel speed of 5.1km/h and 14 knives engaged including idling and headland turns.

Spot flow rates of 165t per hour were noted.

Interestingly, the machine was also operated at 800 PTO speed instead of the normal 1000 rpm speed, markedly reducing power requirement and cutting fuel use, while maintaining the same output and bale density.

On the practical front, six farmers rated the baler for practical aspects such as hitching, un-hitching, setting and operation, bale quality and maintenance. Those tested particularly noted the ease of use of the settings menus and the trouble-free operation of the ISOBYS terminal.

The overall test rating was ‘good’. www.claasharvestcentres.co.nz

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C5 Bolted & C6 Pinned

S2 Pinned

• 1 x size 15 bale • 2m diameter • 15 feed positions • 25-30 animals

$850 NOW

750

$

EX GST

The new Claas Variant 400 series passed its test with flying colours.

• 2 x size 15 bales • 3 x size 12 bales • 35-40 animals

$100

DISCOUNT

$1200 $

NOW

1100 EX GST

NEW ZEALAND’S PROVEN STOCK FEEDER FOR 24 YEARS • 100% New Zealand Made • 100% New Zealand High Tensile Steel

GEA says its Monobox modular milking platform suits herd of every size.

Automated milking for every herd

FEED SYSTEMS SINCE 1962

GEA HAS rounded

Supreme quality stainless steel feed trays / Exceptional back-up support / Easy to use and maintain First class installations / Robust construction / Skiold Disc Mills Grain Holding Silos / Utility Augers / Mobile Auger

LK0080053©

DAIRY FEED SYSTEMS

out its automatic milking system range with its Monobox and DairyProQ technologies.

The two products offer efficient, automated milking technology easily integrated into any farm; the result is high milk quality, optimum volume, flexibility and transparency, the company says.

The new Monobox modular milking robot system has a linear design layout which enables smooth and easy animal traffic.

In contrast to all other existing solutions on the market, the Monobox is distinguished by its modular DairyProQ auto rotary milking technology

based on a concept called ‘Inliner Everything’. The entire milking routine is carried out automatically in a single process within the teat cups.

The system suits milking herds of 500 animals or more with a single system.

GEA says DairyProQ uniquely “revolutionises milking for largescale operations, enabling a milking process that is decentralised and individual to each milking stall, with a high level of system stability and top milking performance”.

The flexibility of the system allows “solutions for any herd size,” the maker says.

– Mark Daniel

DAIRY NEWS MARCH 14, 2017

MACHINERY & PRODUCTS // 29

Subtle upgrades to feeder range MARK DANIEL markd@ruralnews.co.nz

HUSTLER EQUIPMENT bought

Robertson Manufacturing last year to broaden its range of feeding equipment, changed the colour scheme from red to the familiar green and yellow and made upgrades for the 2017 season.

It took the proven design and made subtle changes and improvements to the manufacturing process to keep prices competitive.

The silage wagon range for 2017 still bears the line ‘The silage wagon that’s built like a tank’.

Three new features simplify maintenance to allow operators to get more done every day with less downtime, Hustler says.

The 130mm diameter conveyor drive, said to be twice the size of the

nearest alternative, keeps the belt tracking straight, requires less adjustment, reduces the slip associated with smaller drives and increases belt life by up to 30%.

A monocoque body design provides massive ground clearance, improves manoeuvrability and achieves higher strength-to-weight ratio, helping combat the issue of metal fatigue caused by flexing.

The chain and bar setup on the floor drive has the system move over the floor without the need for guide channels, which tend to clog with silage and cause corrosion; and it ensures all material is swept onto the cross conveyor.

All bars are fully supported right to their extremities, resulting in less bending of bars, broken conveyor chains and manual unloading of the wagon.

Sea covers last longer A TRADESMAN’S vehicle takes a pounding during its working life, but there’s no reason for the seats to be trashed when a set of good covers can protect them. The aptly named Tradies range is now available from selected automobile stores around the country.

The popularity of utes has sky-rocketed in New Zealand in recent years and while many are purchased as working vehicles, many serve as the family truck on weekends. The covers should keep mum sweet when she’s in her gladrags, and protect the seats when the little darlings or the dog have accidents in the back seats.

The Tradies seat covers are made from hard-wearing, heavy-duty waterproof polyester canvas which is rip and tear resistant; it provides a barrier to mud, grease and grime.

The covers carry a five-year guarantee against faulty materials or workmanship. www.griffithsequipment.co.nz.

Meanwhile the wellknown Comby feeder range suits farmers wanting a single feedout wagon that can reliably feed out any type of supplementary feed --

silage, bales, root crops or grains.

The Comby makes feeding in the field safer because its lower centre of gravity makes for a more stable machine.

$9,995

Hustler silage and combi wagon.

EX GST

SAVE $1,655

HARDEST WORKING, SMOOTHEST RIDING FEATURES:

680 KG

45 HP

ON DEMAND TRUE AWD

CERTIFIED ROPS CAB FRAME

680KG TOWING CAPACITY

ADJUSTABLE SEAT & STEERING WHEEL

ELECTRONIC POWER STEERING

ENGINE BRAKING SYSTEM & 4 WHEEL DESCENT CONTROL (4WDC)

HEAVY DUTY FEATURES

*Offer ends 31/3/17 or while stocks last. Offer only available at participating Polaris Dealers. Not valid with any other offer. Excludes fleet clients.

*Offer ends 31/3/15 or earlier if stocks run out. Only available at participating Polaris dealers. Not valid with any other offer. Excludes fleet clients.

0800 440 290 | www.polaris.co.nz |

/PolarisNZ

EX GST

It’s time to get your nitrogen working as hard as you do.

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WAVE23502 DNFP CA

Milker.

Rearer.

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Drencher.

Planner.

Partner.

Leader.

Farmer.

Make the upgrade to SustaiN. Call Ballance on 0800 222 090 or visit sustaingain.co.nz to learn more.

BAL23502_DNFP_CA_FA.indd 1

7/03/17 3:05 pm