who won the ute?
animal health
Waikato farmer comes up trumps in Mahindra’s Win The Ute competition. page 12
Oral and injection combo advised for control of deer parasites. page 35
EARLIER. EASIER. EFFECTIVE.
RuralNEWS to all farmers, for all farmers
Field-to-Family Protection
august 19, 2014: Issue 567
www.ruralnews.co.nz
Local miller feels grind a n d rew swallow
MULTINATIONAL INTERESTS are putting the squeeze on farmer-owned start-up flour producer Farmers Mill. “We’ve got a real battle on,” chief executive Grant Bunting told Rural News. In the past three months he says Champion Flour has slashed prices in the South Island to what he believes must be below the cost of production. “We are well aware of the costs: 85% of the cost of flour production is grain.” The prices are at an $80-90/t discount to those being quoted in the North Island
where, to date, Farmers Mill hasn’t been marketing its product. “The cosy duopoly still exists up there,” says Bunting. “It defies logic that the two islands should be so far apart in pricing parity.” Bunting believes Japanese-owned Champion and British-owned Weston Milling are struggling to compete with the provenance of Farmers Mill’s 100% New Zealand grown, owned and processed flour, and they’ve been losing market share in the south as a consequence. The success of that marketing pitch,
and smooth running of the new mill in Timaru’s Washdyke industrial area, has seen Farmers Mill process 30,000t of grain in its first year, well ahead of its budgeted 22,000t. Now Champion, bought by Nisshin Flour Milling from Goodman Fielder last year, is fighting back on price, but at prices which Bunting says must be unsustainable for the corporate. “They are probably more sustainable for us, because we are grower owned.” Bunting says Farmers Mill’s directors and shareholders, chaired by largescale farmer and recent rich list debutant
butter is back! Fonterra chief technology officer Jeremy Hill gleefully displays a recent Time cover that tells its readers to eat butter. He says that after losing ground to margarine for 50 or more years, butter is back in favour with consumers. Find out more about the work Hill and his team of technologists at Fonterra are doing to help dairy products find their way back into consumers’ and health advocates’ good books again. – page 5
Murray Turley, are prepared to raid the balance sheet to win the battle if need be. However he says he “wouldn’t rule out” a complaint to the Commerce Commission if such predatory pricing persists. In the meantime they’re taking the fight to the North Island, looking to expand Farmers Mills’ markets. The Commerce Commission confirmed to Rural News predatory pricing is illegal but prices must be shown to be below cost for a sustained period for it to investigate. Champion Flour did not respond to Rural News’ request for an interview.
More lambs this year BEEF + Lamb NZ expects 300,000 extra lambs this season, assuming kind weather and adequate feed supplies. Scanning results averaged nationwide are estimated higher than in 2013. But the lift is modest, reflecting last year’s drought and a high mutton kill. BLNZ’s economic service says its nationwide survey in the past season shows sheep numbers down by 3.2% to 29.8 million, and beef cattle up by 1.6%. Chief economist Andrew Burtt says the main reason for the drop in breeding ewe numbers (now 19.96 million) was an overall decline in sheep numbers in the South Island. This reflects changing land use – finishing farms converting to dairy or dairy support. Strong mutton prices driven by rising demand from Asia encouraged high cull ewe processing for a second year. For the first time since 2006-07 beef cattle numbers increased, to 3.76 million, reflecting good feed conditions and improved returns, which led farmers to hold on to older cattle. “Breeding cows were in good condition at mating,” Burtt told Rural News. “With favourable feed supplies over the winter, and assuming good feed supplies continue into spring, the calving percentage is expected to be similar to last year.” – Peter Burke
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