Rural News Issue 498 by Rural News Group

Dairy converts

Oilseed option

Success starts with the calves for Hawkes Bay farmers Karen & Donald Fraser. page 33

Biodiesel area continues to grow but price questions remain. page 15

Rural NEWS to all farmers, for all farmers

august 23, 2011: Issue 498

A Te Puke maize grower is coming back for more.

page 52

www.ruralnews.co.nz

New fears over TAF

snow bother

Rural News columnist Anna Holland’s dog Chloe moves these sheep on. Elsewhere calves were the concern. Snow reports pages 6-7; Holland’s column, p40

SUD ESH K I SSUN

Devil in the detail A FORMER Fonterra Shareholders Council chairman says 100% farmer control and ownership is essential under TAF. Blue Read says the TAF concept is “rock solid” and is the way forward for the co-op. However, it should not compromise on ownership and control. “The devil will be in the detail,” he told Rural News. “Outside capital is needed by the co-op but it must not come at a cost to farmer ownership and control. The council has to do a due diligence and understand the downstream

implications of TAF.” Read is aware of grumblings among farmers on the impact of investors on governance. He has received a few phone calls. Read is also aware of Eddie Glass’ group in Canterbury raising concerns on TAF. “I think farmers will be eagerly waiting for the next round of meetings.” As Rural News went to press, board member John Wilson was off to Canterbury to meet with the Glass group. Read, who chaired the shareholders council during TAF’s launch, believes the concept can work.

TAF includes a Fonterra Shareholders Fund developed to create additional liquidity and options to help supplying farmers stay in the cooperative. The fund would help supplying shareholders retain shares in Fonterra they might otherwise want to sell, or help farmers buy shares if they need them. Investors would be able to buy units in the fund. Unit holders would not own shares in Fonterra and therefore would not have voting rights. All voting rights would remain with supplying shareholders who would own the shares. • Shareholder exlplains concerns p5.

FONTERRA IS facing dissent among shareholders over its trading among farmers (TAF) scheme. One year after endorsing TAF some shareholders question whether they would keep 100% ownership and control of the co-op. A South Island group led by Ashburton farmer Eddie Glass is leading the charge. He voted last year for TAF, but says there is a “hidden agenda” to allow investors greater say in Fonterra’s governance. They fear investors holding dividend-bearing non-vot- Simon Couper ing units would end up appointing non-farmer directors, favouring higher dividends at the expense of milk price paid to suppliers. Shareholders would have to rubber-stamp appointments at annual meetings. Investor-friendly directors would lead to tensions between the dividend and milk price, Glass told Rural News. “We’d have a ‘Clayton’s vote’ in that we would be ratifying outside directors already vetted by the investors so we’d end up with all outside directors in favour of dividend returns as opposed to milk price. This is typical of the tensions between milk price and dividend yield as each has a dramatic effect on

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the other and therein lies the problem. “How can a board serve two masters? In history there has never been a co-op that has taken investors’ capital and survived as a co-op.” Glass also takes a swipe at the Fonterra Shareholders Council, saying it isn’t “asking the hard questions” on their behalf. The final TAF vote has been left to the council but Glass is worried. “When we look into this it is nothing other than a Clayton’s vote set up as a box-ticking exercise.” However, council chairman Simon Couper says “a good process” is in place to review TAF before final approval is given. Couper has not been contacted by Glass or his group but says criticism of the council is “a cheap shot”. He refused to discuss appointment of investorbacked directors, saying he was bound by a confidentiality agreement. But he conceded investors would want more say in running the co-op. “Ownership and control of the co-op is essential to our core beliefs. If investors interfere with control and ownership, then it will not be a box-ticking exercise for us,” he says. Fonterra chairman Henry van der Heyden says it is discussing governance to page 3

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Rural News // august 23, 2011

news 3 issue 498

www.ruralnews.co.nz

RMSS progress producer and processor driven tony b enny

News �� 1-18 World �� 20-21 Agribusiness �� 23-25 Markets �� 26-27 Hound, Edna ��28 Contacts ��28 Opinion �� 28-31 Management �� 32-37 Animal Health �� 38-45 Machinery and Products �� 45-54 Rural Trader �� 54-55

Head Office Top Floor, 29 Northcroft Street, Takapuna, Auckland 0622 Phone: 09-307 0399 Fax: 09-307 0122 Postal Address PO Box 3855, Shortland Street, Auckland 1140 Published by: Rural News Group Printed by: PMP Print Contacts Editorial: editor@ruralnews.co.nz Advertising material: davef@ruralnews.co.nz Rural News online: www.ruralnews.co.nz Subscriptions: fionas@ruralnews.co.nz ABC audited circulation 80,327 as at 30.6.2011

GOOD PROGRESS is being made on adopting the recommendations of the Red Meat Sector Strategy report but it’s up to the participants, farmers and industry, to make it work says strategy co-ordination group co-chairman Mike Petersen. “The only people who are going to benefit [and] realise that $3.4 billion are the participants themselves – that’s farmers and companies in the industry so they’re the ones who have to take action,” Petersen says. The report identified $3.4 billion extra wealth that can be created in the industry by 2025. Petersen says since the report was released in May, the first recommendation – to appoint a co-ordinating group to keep the strategy alive and promote the themes in the report – has been adopted.

Former MP Katherine Rich and dairy and meat industry leader Graeme Milne joined the board this month. “At the same time we’re doing a stock-take of what is happening in the industry,” Petersen says. “Deloittes talked about things we needed to focus on; a number of those are underway.” He says Beef+Lamb New Zealand is working on the bestpractice component, helping farmers understand where they sit in profitability compared to others, like a benchmarking service. And work continues in the processing sector, e.g. the ovine automation project research to improve processing efficiency. Industry players will next month hold the Red Meat Sector Conference in Rotorua. Says Petersen, “This is the chance for the industry to come together, put down what’s already happening now

and then reinforce what needs to happen in the next few months.” Federated Farmers Meat and Fibre chairperson Jeanette Maxwell says adopting the RMSS report’s recommendations is important. “It has to be done for the survival of the industry. “I’d have thought they would get it up and rolling quicker to give farmers time to know what was going on. Beef + Lamb held their consultation meetings and met farmers last month, but though they explained the strategy there was nothing going forward. “I’d like to hope they have a good conference, discussion and debate so they have initiatives to take forward. While I know individual companies have their own initiatives, it would be nice to see industry unity.” But Realising Industry Potential (RIP) spokesperson

Mike Petersen: “The only people who are going to benefit [and] realise that $3.4 billion are the participants themselves.”

Sarah von Dadelzen says until farmers understand and act on the report’s recommendations, little progress will be made. “It’s not rocket science but if people ignore it…. If you look around a group and ask how many people in the room have read it – it’s probably few. That’s a bad starting point already.

No crash in lamb price predicted

“I don’t think there are fundamental flaws in it; my view is we need farmers to actually uptake and I don’t know farmers will, to be honest. “It’s a document giving you a broad outline of what we could achieve and how we can achieve it. Now it’s up to farmers and industry players to put that in place.”

New TAF fears from page 1

SU DES H KISSU N

LAMB PRICES are easing but there is no sign of a slump, says Silver Ferns Farm chief executive Keith Cooper. He blames the price plateau – ocurring at a time when schedules normally edge up – on the strong Kiwi dollar. But the traditional low winter supply will limit the downside until processors come out with their new season prices in October, he says. Beef + Lamb New Zealand’s

recent stock survey release predicts this spring’s total lamb crop will be up 1.4 million on last year’s poor result of 26.2m lambs. But it will still be the second smallest lamb crop in 50 years. BLNZ economic services director Rob Davison says the tough spring of 2010 – with snow, sleet and driving rain affecting many farms – helped cut sheep numbers 2.1% to 31m at June 30. This resulted in a low supply of lambs this year forcing a cutback to the supply of lambs that can be held over as future breeding flock

replacements. But tight global supplies of lamb and sheepmeat also lifted world prices, he says. “These high prices allowed a higher-than-usual cull of poorerproducing sheep with the objective to improve the flock quality for future breeding seasons. This also contributed to the sheep flock decrease.” World lamb prices were also up on last year but the lamb supply from New Zealand remained constrained because of the previous spring’s poor crop.

issues raised by potential investors with its advisors. But claims that investor-backed directors would push for higher dividends over milk price is “nonsense”. The payout is dictated by commodity prices, he says. “In fact, investors are worried farmer-backed directors will push for a higher milk price over dividends. So there is a counter argument. I think those concerns are misplaced.” Van der Heyden has also not heard directly from Glass or his group but acknowledges some directors may have met them recently to discuss the issue. “Directors are meeting farmers all the time,” he says. But van der Heyden says the feedback he is getting from farmers is “get on with it”.

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Rural News // august 23, 2011

4 news

Ag firms among R&D money ANDREW SWAL LOW

SEVERAL MAJOR agricultural supply firms are among the recipients of the latest round of R&D grants from the Government. Last week Science and Innovation Minister Wayne Mapp allocated another $10 million of Technology Development Grants announced in the 2010 budget. To call down the funds, grant recipients must provide 80% of the funding for the proposed projects. Of the 19 recipients, Ancare Scientific landed the second largest slice, at $1m, though Mapp announced the grant as $5m, failing to point out that 80% of that had to come from the applicant. Nonetheless, Ancare managing director Colin Harvey says the funding is most welcome, and helps prevent such firms taking their research overseas. “We could set up in Singapore tomorrow and run a lot more profitably,” he told Rural News. Keeping the business here benefits New Zealand farmers because

the animal health issues they face are front-of-mind for Ancare’s researchers, and work will be trialled in New Zealand conditions, which might not be the case if it was overseas. Lesser known animal health firm Argenta was also in the money,

tor and majority shareholder Doug Cleverly told Rural News. At present that’s split roughly 50/50 between product it developed, and product it contract manufactures, but long-term the goal is for all the product made to have been developed by the firm.

R&D grants will help speed genetic gains, says Focus Genetics. Animal health firms Ancare Scientific and Argenta were also in the money.

$4.7m of work qualifying for the 20% grant funding. “We make 4m litres of drench: that’s a huge percentage of the product sold in this country,” direc-

New drench Startect is in that category, Pfizer having approached Argenta with the active, asking it to formulate a product for use on farm. “It’s something no-one out

there really knows.” Red meat genetics firm Focus Genetics, the result of the Rissington-Landcorp breeding amalgamation, landed support for up to $660,000 of work. Focus chief executive Graham Leech says the funding will speed progeny testing, CT scanning, DNA & SnP parentage testing, CarLa parasite resistance work, genomic analysis, FEC analysis and early rumen development work. “It will enable us to increase expenditure on R&D in these areas which in turn will allow us to pass on this genetic improvement to our farmer customers.” Focus Genetics says it has the largest available single red meat commercial database worldwide. Announcing the grants, Mapp said it is vital that high-tech exporting companies maintain their competitive edge in global markets. “The only way we can create the jobs, higher incomes and better living standards New Zealanders deserve is through building faster and sustainable economic growth.”

Fonterra lukewarm on price probe SUDESH KISSUN

FONTERRA WILL reluctantly participate in the parliamentary inquiry into milk pricing, says chairman Henry van der Heyden (pictured). The co-op understands the reason for an inquiry but does not believe it is needed, he told Rural News. “We know the Cabinet

has made a decision to hold the inquiry and we will be part of it,” he says. The parliamentary commerce select committee is accepting public submissions until September 13. It will determine whether New Zealanders are paying too much for milk and market operations, says committee chairwoman Lianne Dalziel.

The committee will consider pricing points for milk from the farm gate to retail. The spotlight will be

on any practices inflating milk prices and discouraging competition. The roles Fonterra and supermarkets play in the milk supply chain are also included. The committee will determine the impact and influence of retailers’ and wholesalers’ practices. Dalziel says it will also consider the impact of international market prices

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and regulatory framework in the milk market. The inquiry will be careful to work in with the existing interdepartmental investigation into milk price matters, she says. “The inquiry will not duplicate the work of this investigation and the select committee recognises officials will continue to consult interested parties in this investigation.”

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Rural News // august 23, 2011

news 5

Shareholder fund fears realised Milk pricing has recently dominated headlines, but behind the scenes a potentially far more serious issue is progressing apace. South Canterbury dairy farmer Leonie Guiney contacted Rural News with her concerns. I WROTE recently in Dairy Exporter expressing dismay that we Fonterra shareholders had voted for constitutional change to enable TAF (Trading Among Farmers) but had seen no detail of the proposal. I have now dug out a presentation to the networkers conference to find buried deep in the detail an absolutely fundamental change to the prosposal relative to what we voted for. I cannot fathom why our shareholders council is so silent on such a major issue. The major change is

this: the shareholders fund that sits alongside TAF – as a means of getting TAF past the DIRA regulations – forfeits the muchpromised 100% farmer ownership and control of cooperative shares . We were initially promised a fund that would issue some sort of voucher to unit holders while farmers retained their share ownership but handed over beneficial rights – the dividend and capital gain (or loss) – to the unit holder. Now, Fonterra is proposing the fund has a custodian to which the legal title of shares is

transferred and the shares are held in trust for the public investor. Fonterra argues this retains control because the custodian is 100% owned by Fonterra. But the only way a subsidiary can be the titleholder of its own shares is if it is acting as a trustee or cus-

todian for someone else. A trustee must act in the interests of its beneficiaries– in this case the unit holder or public investor. This immediately makes those Fonterra shares subject to New Zealand company law. Those unit holders then have many rights under New Zealand law. They can form interest groups and force changes via the high court. They will demand more representation on our board. They will eventually insist that the milk price is affecting their returns.

Only one word in the milk price manual would need to be changed for farmers to lose control – a change from the principal that the milk price should be ‘maximised’ to it being ‘optimised’. Why, while we are picking up calves out of the snow, should I have to be reading the Companies Act to see what risks the Fonterra proposal presents to me as a shareholder? Surely

the shareholders council exists to do this job for me: to vigorously assess the proposal and keep me informed. Meanwhile the shareholders council is busy organising a 10-year party and our cooperative is on the verge of a quiet partial float. Shareholders must demand another vote on the basis that what we voted for has been fundamentally altered. I do not

accept director suggestions that when the dairy industry is under siege from green and/or political interests we should appease them by selling them a portion of our business. If the wolf is at your door do you think he will go away if you throw him one of your five children? This shareholders fund is absolutely changed from what we voted for. It is absolutely positively Wellington.

New round of meetings FONTERRA WILL hold a round of farmer meetings next month to update shareholders on trading among farmers (TAF). Chairman Henry van der Heyden says the first meetings will be September 25, three days after its 2010-11 annual results are announced. Fonterra directors and management will take part. Van der Heyden says more details on TAF will be provided to farmers but he points out legislation must be passed in Parliament before the scheme can be launched. “As far as we are concerned, 90% of farmers voted for TAF and that included 80% of total milksolids vote. Unfortunately, we could not launch TAF this year but are on track for a 2012 launch.” The TAF legislation could not make it onto the parliamentary agenda before the general election. The Government also sought more time to address concerns raised by some industry players.

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Rural News // august 23, 2011

6 news

Early snow warning keeps stock TO N Y B E N NY

IT WAS tough, but stock losses were few last week as gales, sleet and snow that swept up the country. Farmers spoken to by Rural News were thankful for early forecasting of the storm, and for generally good condition of stock. The most common complaint was lack of sleep, particularly on South Island dairy farms where the worst weather of the winter hit at the height of calving. “I haven’t really had any sleep for the last two days because last night I was still on the farm at 2am and I was back there at 4.30am,” Peter Schouten, north Canterbury, said midweek. “I’m going to have a couple of hours sleep now and I’ll be back out in the

paddock about 10.30pm tonight.” Calves were being picked up as soon as possible and the most chilled bathed in warm water back at the shed. “The heads came

people were prepared, with feed and shelter organised as a result. In Southland, Feds Sharemilkers chair Donal Kidd reflected that up to last week it had been one of the best winters

“Everybody’s doing it. We’re trying to save as many as we can. You’re always going to lose a few but in this sort of weather you lose a few more.”

up, they just bucked up straight away. We gave them some colostrum and away they went.” Federated Farmers North Canterbury dairy chair, Kieran Stone says the storm was “probably as bad” as forecast but

anyone could remember, after a good autumn. “Probably pasture covers are as good as they’ve been for years at the start of calving and most people have plenty of supplement on hand.” Even so, Kidd says, it

Coming in from the cold: Central Southland farm manager Shane Hodges collects a newborn calf during a break in last week’s snow.

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Rural News // august 23, 2011

news 7

losses down was tough going in the storm. “We’ve had about 5 cm of snow and it’s pretty much all gone now so it wasn’t too bad in terms of covering up the grass but it’s made it wet and the wind chill wasn’t pleasant; it was pretty cold.” Canterbury had more snow than most parts of Southland and farmers and staff were even shorter of sleep than normal at calving, many going round their calving mobs every few hours through the night. Mid Canterbury Federated Farmers dairy chairman Frank Peters says sleep is in short supply on most farms. “I know my son’s pretty bloody tired. I talked to him at seven o’clock at night and he was off to bed for three hours and then do a 10 o’clock check and he gets a couple of hours in between and there’s

another lot. “Everybody’s doing it. We’re trying to save as many as we can. You’re always going to lose a few but in this sort of weather you lose a few more. In those freezing conditions if the calf can’t get up in the first 20 minutes or so, they’re going to struggle to make it.” Peters agrees good pasture covers helped farmers cope but was concerned about the effect the snow could have on feed quality longer term. “That long grass, if it gets too much moisture on it, goes a bit slimy at the base. So a lot of people will want to get a lot of that off as quick as they can so we can get some new spring growth. “Probably the worst thing that could happen now is if it was to turn warm quickly because some of that grass in the base will start rotting.”

Schools out

Bella (8) and brother Alex (10) Dykes and Bonnie the farm dog enjoy some fun in the snow after their school, St Thomas Aquinas Primary in Winton, Southland, was closed for the day last week.

But for now, most dairy farmers, while sleep deprived, are coping well. “So far I can’t complain,” says Schouten. “We’ve got 48 hours of bad weather on our hands. We’ve had an entire winter of awesome weather. I’m not complaining, but it’s bloody hard work.”

Lost in his own back paddock AN UNUSUAL experience of dairy farmer Peter Schouten, North Canterbury, indicates the severity of last week’s storm there: he got lost in one of his own paddocks. “We had such a strong southerly gale at night, I couldn’t see where I was going. I had about 10 m vision. You lose your bearing on where you are in the paddock,

and the paddock was about 18 ha. “I kept the steering wheel in one direction, found a fence line and followed it. It was a bit of an eye opener to see how lost you can get in those sort of conditions.” His truck later got stuck in the snow. “The rest of the night I [patrolled the calving paddock] with the four wheeler so that was a bit cold.”

Not as bad as forecast FARMERS IN the North Island’s east say last week’s wintry blast wasn’t as bad as expected but are thankful for the warnings nonetheless. “We took our normal winter precautions: fed out extra hay and made sure we picked up cows and calves twice, rather than once a day and moved them to sheltered paddocks,” Federated Farmer’s dairy chairperson for Tararua, Gray Beagley, told Rural News. “It wasn’t as bad as they had forecast.... We’ve been let off lightly here in Woodville but south of Eketahuna there was a severe snow storm and further north, early in the week, the road was closed between Dannevirke and Waipukurau.” From his farm at Trelinnoe near Napier, Federated

Farmers president, Bruce Wills said conditions weren’t critical. “On the whole, Hawkes Bay has got through pretty well. I flew last week from Napier to Wellington and there was a lot of snow on the coastal belt but it hasn’t stuck around too long. “It’s been challenging for some farmers on that warmer country south of Hastings. It was a rare and severe snowfall for those lower lying areas, but I’ve heard no accounts of any significant loss of life.” Wills was in Wellington at the height of the storm. “There was more snow there and in the Wairarapa than in a lot of Hawkes Bay.” With sheep in good condition and plenty of grass, it was “a good year for a weather event like this to turn.”

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Ewes a worry – Petersen WAIPUKURAU, HAWKES Bay farmer and Beef + Lamb New Zealand chairman Mike Petersen fears last week’s snow may have caused “some disasters over this way.” “I’ve just been down in Wairarapa and it’s white pretty much to the coast – not good at all.” Some early lambers would have been caught by the snow, but Petersen says he was more worried about ewes.

“The lambs actually aren’t too bad; there’s probably more concern about the in-lamb ewes that haven’t yet been set stocked. They’ve not been able to get to feed for three or four days now. “It’s probably inevitable there’s some fallout from this but hopefully it’ll clear quickly.” Hot wires knocked down or losing charge in the wind and wet snow caused management problems for some.

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Rural News // august 23, 2011

8 news

Psa spread worse than expected SUDESH KISSUN

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THE KIWIFRUIT disease Psa has spread more aggressively during the winter than expected and growers face an uncertain future, says industry marketer Zespri. In its 2010-11 annual review the company says Psa incursion is “potentially damaging at both an individual grower and an industry level....” “As a result, the industry is now confronted with a period of horticultural and financial uncertainty as we develop the expertise and technical tools to manage Psa in New Zealand.” Zespri’s warning comes as New Zealand’s largest kiwfruit grower Seeka Industries reports Psa spreading in Te Puke, Bay of Plenty. The disease has reached Matapihi, north of the Papamoa hills, a marked deterioration in the situation since the disease has spread outside the previously affected geographic areas. Generally across the industry

detections have increased to as much as 19 Psa confirmations in one week. Now 170 orchards have been affected across a wide area. Seeka says the gold variety is particularly susceptible to the disease; secondary infections affect the green variety in only a few cases. Laboratory confirmed incidences, or secondary symptoms, have been observed on Seeka-supplying orchards covering 200ha of green and 138ha of gold. Within these the gold orchards are severely affected, the green only lightly. Seeka and kiwifruit packer Eastpack have formed ‘Taskforce Green’ to search for a scientific solution. It is made up of scientists, academics and consultants. Progress continues on developing solutions to contain the outbreak, Seeka says. Zespri is also confident the industry will cope with Psa. “As an industry, we have faced significant challenges in the past and have overcome them. The response

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NINETY PER cent of respondents to Rural News’ latest online poll say New Zealand should adopt mandatory country-of-origin labelling – one of the most sweeping results since Rural News in May relaunched its website and introduced weekly opinion polls. This week you can have your say on whether Fonterra should reveal its milk pricing formula. As Rural News went to press, just under 50% of respondents had said yes. Go to www.ruralnews.co.nz

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Rural News // august 23, 2011

news 9

Pipfruit tough but no panic barbara g illham

DESPITE REPORTS pipfruit growers are in a dire state with many facing financial ruin Horticulture NZ’s newest director Julian Raine says there is no need to panic. Raine concedes many growers face a financial challenge, chiefly because of the exchange rate.But he’s optimistic about the industry. MAF’s recent annual sector report showed many growers lost money last year and struggled as a result of, e.g. the high New Zealand dollar eroding export returns, tough weather and too-low returns for late-season varieties sold in Europe. And despite most markets performing well this year the high dollar may again grind growers financially in 2011. Says MAF senior policy

analyst Annette Carey, “As a result pipfruit growers are deferring expenditure where they can.” Raine says this is logical. People can only spend what they have and will need to “sharpen their pencils and work out where they stand.” Nelson and Hawkes Bay orchards suffered markedly different levels of loss: Nelson growers had their second big loss in a row (deficit $126,200), but equivalent Hawke’s Bay businesses much less (deficit $5000). With the high New Zealand dollar affecting exports, Nelson growers could face trading losses of $54,100, while Hawke’s Bay growers could profit as much as $15,700. Raine, based in Nelson, says this is partly due to the varieties grown in the two regions. “In Nelson we grow

Report outlook MAF PIPFRUIT, kiwifruit and wine monitoring reports are produced annually, the latest coming out earlier this month. They present the financial performances of typical orchards and vineyards, based on information from a sample of growers and industry stakeholders. This year’s report says the high New Zealand dollar is harming export focused industries such as pipfruit. Many growers lost money during the 2010 calendar year and despite markets performing well this year the exchange rate is eroding returns, resulting in 2011 being another poor year for many. Pipfruit growers are having to defer spending and assess alternative business models. Growers in Nelson are hardest hit: $126,200 deficit for the typical orchard, contrasting with only a $5000 loss in Hawkes Bay. It’s the second big loss in a row for Nelson growers.

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mixes of Braeburn and Jazz apples whereas in the Hawke’s Bay they grow more Asian varieties. “This means Nelson growers have been affected more by high exchange rates because more of their fruit went to the more traditional markets where there is increasing competition and weaker consumer

demand. “Hawke’s Bay growers on the other hand have benefitted by growing varieties for the stronger Asian markets. “We have a large asset in orchards, not to be thrown away in a hurry. Growers are now at the mercy of banks and can’t walk away. “Varieties take time to

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change. You can’t change what apples you grow, as you can for example change a vegetable crop by planting something different. “We are getting quite good prices in the local market but the main problem is definitely the exchange rate. At present only about 9% comes back to the farm gate.”

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Rural News // august 23, 2011

10 news

Supermarket code call no witch-hunt SUD ES H K I SSU N

GROWERS ARE backing a proposed supermarket code of conduct to rein in fresh fruit and vegetable prices. But HortNZ insists it’s not a witchhunt against supermarket operators; they enjoy cordial business relationships with growers. HortNZ chief executive Peter Silcock says a code of conduct will remove “a lack of transparency” about supply chain costs. “At times growers struggle to understand the large difference between wholesale and retail prices,” Silcock told

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spokesperson Sue Kedgley says supermarkets need to come clean and tell New Zealanders their margins fresh produce. “Progressive and Foodstuffs are quick to deny marking up fresh fruit and vegetables but are unwilling to provide any proof to back their claims. “Many growers in the 2011 Green Party survey are struggling to make ends meet and are not getting a fair deal. Consumers are also feeling the pinch of high prices for fresh fruit and vegetables in supermarkets.” She says a supermarket code of conduct will

bring some transparency to how retail prices are set, good for growers and consumers. Silcock agrees an independent look at pricing will be good for everyone. “It’s not a witch hunt against supermarkets but will provide confidence to everyone.” Australia and the UK have codes of conduct for supermarkets, the UK has a dedicated ombudsman. This is an option for New Zealand, Silcock says. Growers also face criticism for high prices. Silcock concedes consumers also feel growers are making money when

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Rural News. But large differences in wholesale and retail prices are not necessarily profit for supermarkets. “Supermarkets have capital costs, staff-related expenses and also pay for transporting goods from warehouses to stores.” Major supermarket operators Foodstuffs and Progressive are under fire for charging high prices on fruits and vegetables. A Green Party survey of 100 fruit and vegetable growers found many believe supermarket margins are 100-200% on fresh produce. Green Party food

TIME IIS RUNNING OUT FOR EMISSIONS TRADING SCHEME EXEMPTIONS EMISS If you own less than 50ha of pre-1990 forest land, and wish to be exempt from the Emissions Trading Scheme, the deadline is fast approaching. It does take time to prepare your application, so get in before 30 September. It’s worth your while.

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prices skyrocket. Not so, he says. “We all know prices are generally high during winter because of climatic conditions. This is because there is a short supply and not much to sell.

“High prices are good for growers but we’re only selling small amounts or don’t have anything to sell.” He agrees tomatoes priced at $10/kg are out of reach for many consumers. But carrots, potatoes

and kumara are reasonably priced, he says. Silcock believes growers need to communicate better with consumers to remove the perception they also are making huge profits.

UK dairy price collusion ends in $100m fines PRICE COLLUSION by UK supermarkets and processors has earned nine of them a total of $NZ100m (£49.5m) in fines. The offending was in 2002 and 2003 but only last month were the penalties imposed by the UK Office of Fair Trading. Anchor brand distributor Arla was among the processors involved but had its fines waived because it blew the whistle. OFT chief executive John Fingleton said the fines send a strong signal to supermarkets, suppliers and other businesses that OFT will act where it finds anti-competitive

behaviour aimed at increasing prices. Competition in the supermarket sector is intense and has delivered to UK shoppers a raft of innovation, choice and improved value for money, Fingleton says. “Our investigation and this decision will help ensure competition is maintained.” All except one firm admitted infringements and had their fines reduced, most by 35%, reflecting the easier OFT investigation. Supermarket Tesco denies infringement and says it will fight its $21m fine.

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Rural News // august 23, 2011

12 news

More dialogue plea from policy maker p eter burke

MORE DIALOGUE is needed between farmers and people who develop policy – but the talking must come before the policy is determined. So says a leader in policy making, Dr Suzie Kerr, closely involved in developing the Emission Trading Scheme. Policy makers must talk to people ‘on the ground’ before they settle on policy options, Kerr argues. She was a keynote speaker at the recent Australasian Climate Change and Business conference in Wellington. She concedes many farmers see the ETS as something from hell, but knows of many farmers concerned about cli-

“Depending on the way the policy is designed, there will be a buck in it for them on the margins. So if they change their behaviour they make more.” Suzie Kerr

mate change and wanting to make a difference. They want their actions to be effective and don’t necessarily agree with some farming leaders on the issue. “There’s a big division in the farming

sector between what Federated Farmers is saying and what others are saying. It seems possible a group of farmers could come up with useful solutions to the problems that exist.”

Kerr says people are past believing they’ll go bankrupt over the ETS and that the country is going to be covered in trees. Some farmers see some policies as more stick than carrot – but that depends who’s saying it, she says. “The farmers feel they’re under threat… possibly unnecessary fear, but some uncertainty about how the policy will play out.” Better dialogue with farmers will encourage them to buy into the policy process, Kerr says. Farmers’ input will result in policies with elements that will trigger changes in behaviour. And farmers will be more inclined to change if they see financial

incentive. “Depending on the way the policy is designed, there will be a buck in it for them on the margins. So if they change their behaviour they make more. “But it’s up to government to decide how cost they’re going to impose on the farmer and who will pick up the balance.” Kerr has started a dialogue group with farmers and others. She aims to get them up to speed on understanding the issues. “Once they understand they’ll be in a better position to give us an informed opinion on what should be happening and what would get them and people like them to change.”

Focus inside gate says consultant FOCUS ON things you can control in your farm business, comfortable with that because they realise their farm value now is more related to what they such as repaying debt, monitoring physican earn from that property. It means cal and financial performance, and decithey have better return on the asset sion-making based on data and not guess which looks better from a banker’s perwork. spective.” That’s the message from Rabobank’s Heenan says new technologies are Feilding manager Chris Heenan, who’s being adopted in an effort to create effiworked in the rural banking sector for ciencies. more than 20 years. “They have probably tried to enhance Most farmers are focusing on things the all grass farming regime and, for inside the farm gate and confidence is example, are refining the amount of ferreturning, despite an asset value drop, tilizer they are applying. They are also thanks to better product prices for lamb, monitoring their drench programmes wool and beef, he says. and generally spending their dollars a “Farmers are probably seeing a drop in Chris Heenan bit more bit effectively.” their asset value since the peak of 2007… Uptake isn’t confined to younger farmers: many in between 20 and 25%. However I think that farmers are their late 50’s are keen to adopt some of the new technologies, he adds.

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Rural News // august 23, 2011

news 13

Biological farmers develop strategy sue edmo nds

‘BIOLOGICAL’ FARMERS are a happy bunch, and they want you to share their happiness. Strategising recently in Auckland, the Association of Biological Farmers attracted farmers, supplier companies and people keen to promote the

concept. Snow and ice didn’t deter them, even those from the Deep South. What is biological farming? Participants agreed soil biology and soil husbandry is at the core. Getting the ‘soil food web’ working as it should leads to more nutritious plant material

for farmed animals and people, the devotees say. Better nutrition gives better food, health and profit for farmers, and many find this is happening now. Spokeswoman Nicole Masters showed diagrams of short- and long-term good and bad effects of using nitrogen as a quick-

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fix boost to pasture. Arguing for a causal loop theory, Masters demonstrated unforseen and unfortunate outcomes, including the need for ever greater doses to achieve sufficient growth, the results and costs of leachate to our waterways. Biological farmers

claim that a different approach, albeit with some time delays, enable soil to do its job without added nitrogen – or unfortunate side effects. Discussion was lively, the sense of commitment obvious. The meeting defined targets for new projects including a ‘toolbox’ concept to help

farmers make decisions. The association recently got $25,000 from the Sustainable Farming Fund, and $12,000 from industry. This will be spent during the next year on communications and information sharing, field days and a membership drive.

Bio enthusiasts heading for Rotorua FARMERS INTRIGUED by the term ‘biological farming’ may learn more at the first New Zealand conference on the subject in Rotorua October 27-28. Rotorua Lakes & Land Trust, with the local Federation of Maori Authorities, is planning a programme on sustainable farming through biological systems, aimed to be ‘by farmers, for farmers’. The Maori involvement there’s a lot of farmland that’s less than fully productive held by Maori incorporations. Though intensifying these areas with ‘conventional’ farming might work economically, it may worsen water degradation of the multiple lakes in the region. To ensure discussion of ‘scientific’ viewpoints there will be sessions on water quality and soil carbon/ecosystems with recognised science and research speakers, say organisers. These will be followed by six people actually doing it and seeing the results. The first day concludes with a scientist/farmer panel discussion, and the second day will seek ways forward, followed by a field trip to a research site at Edgecumbe. Registration is $250 including dinner and field trip. admin@rotorualakesandlandtrust.co.nz

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Rural News // august 23, 2011

14 news

Dairy development mixed blessing for arable sector VIVIE N NE H A LDA N E

MAF’S ANNUAL arable monitoring report says dairy will underpin cropping incomes, but cows’ colonisation of the Canterbury Plains is equally a threat, say arable leaders.

“Arable farmers aren’t getting rewarded for the risk and the capital invested in their farms, compared to dairy farmers,” Federated Farmers Grain and Seed chairman, Ian Mackenzie told Rural News.

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“The terms of trade as a dairy farmer are so good it makes arable farmers wonder why they are still in business.” New or revamped irrigation systems are a driver in the drift to dairy. “Over the last few years the Rangitata diversion race (RDR) schemes in mid Canterbury have enabled traditional border dyke-irrigated farms with livestock/cropping to change to centre pivot irrigators. Once they do there’s a tendency to... dairy conversion.” The new Barrhill Chertsey (BCI) scheme, bringing irrigation to some previously dryland mid Canterbury farms, is also a factor. “It’s quite expensive and many will need to go into dairy to generate the income to justify the capital expenditure. Dairying is reliable and predictable and having irrigation makes it easier to predict how much grass you’re going to grow and how much milk you’re going to produce.” MAF’s report, released August 5, acknowledges the trend.

“While many arable farmers had a profitable season last year there is a swell of interest in converting some of their land to dairy which is still performing more strongly,” it states. Cropping farmers can expect strong global commodity prices and the growing demand for dairy support to underpin a significant increase in returns over the coming year, it says. Mackenzie says wheat and barley prices last year weren’t high enough to make cropping a viable

business, but this spring’s crops should do better. “You can sell grain forward for next year’s harvest at reasonable prices. They were available at $100/t more than they were last year. So if you’re growing reasonable crops you should be able to make money out of growing grain.” Federated Farmer’s Grain and Seed chairperson for Hawkes Bay, Rob Foley, thinks MAF’s report was mostly on target. However, he estimates last season’s grain yields in Hawkes Bay were 30%

Ian Mackenzie

down on average, rather than 15%. “Cropping is only a small part of people’s business here, compared to Canterbury.” He sees the increase in dairying in his area as positive. “The local dairy industry is starting to use a lot of grain and while it’s eroding some cropping land, it should add profitability if we work on having a relationship with dairy farming. “We are in a good position here for cropping

Driving forces: irrigation and dairy conversion are eroding arable area.

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with two dams on the way. McCains is investing in Hastings and Watties wants to come back to grow beetroot. Dairy farmers want our barley, so we won’t have to export it out of Hawkes Bay. Overall, things are good.” While he didn’t have any information on contracts for barley for the coming season, he said contract prices for malting barley delivered to Manawatu will be $480/ tonne. “We are relatively happy with that.”

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Rural News // august 23, 2011

news 15

Biodiesel: a little more every year VIVIE N NE H A LDA N E

GROWERS OF crops for biodiesel no longer feel ‘fringe’, says Biodiesel NZ general manager Andrew Simcock. Rural News found him upbeat about economics and the climate, despite his battles with the snow last week. “We have at least 50 growers from Manawatu to Southland for the autumn sowing of oilseed rape (canola), and we’re organising spring contracts in the same areas. “We expect sowing to take place in September and we have strong support from farmers wanting a portion of their crop anchored to a non-traditional market – transport.” The company’s biodiesel production business last year doubled in size. It counts on farmer support to keep growing. “Despite the volatility of the market, it’s a growing industry and every year we are able to give a bit more return as we grow our business.” “The price we’re going out with is $825/tonne depending on the location. We look at it area by area to estimate the current demand.” This price is much higher than it was

“Biodiesel’s plans and prices are a bit better this year. They are still paying up to $770 /tonne [for autumn sowings] which is good and growers are getting about 4 t/ hectare. By my calculations we need to gross $3000/ha to make any money, so they are getting close, but they’re not there yet. “They are growing oilseed rape in

non-traditional areas such as the Mackenzie Country, Haka Valley and North Canterbury. Biofuel went into these more remote areas because they weren’t offering enough to get traditional cropping farmers to grow the stuff. “It fits well into a rotational cropping system, but by my calculation, farmers need to be paid a bit more.”

in brief Oilseed rape’s a useful option, but prices are still a bit light, says Feds’ Grain and Seed chair, Ian Mackenzie.

last year, due partly to “growing the business to get certainties on some economy of scale, and partly because this time last year commodity prices, including fuel, were higher, so there’s more return we’re able to pass on.” Simcock says farmers are more confident about growing oilseed rape as part of their crop. It’s here to stay and is a good additional crop.

The by-product of cropping oilseed rape is the ‘meal’ or ‘cake’ market for animal food. “There’s increased demand from pig, poultry and beef markets.” Biodiesel NZ is the largest biodiesel business in the country, a part of Solid Energy NZ Ltd. A few other smaller companies make biofuel in the North Island. Federated Farmers Grain and Seed chairperson Ian Mackenzie says,

FAR voting closes Sep 2 CROP GROWERS have less than two weeks to have their say on the future of their levy body, the Foundation of Arable Research. All registered growers will have received voting papers; if not, register by telephoning 03 325 6353 or email far@far.org.nz The referendum is different from FAR’s three previous polls: besides maize and combinable crop growers voting, cereal silage growers have an opportunity to vote on a separate levy order for such crops.

If this new levy is passed it will be set at $10.00/ha, ex GST. Currently only grain and seed growers get information from FAR. Chairman Stuart Wright says he hopes all growers consider FAR levies “an investment in our businesses, not a cost.” “FAR is continually appraising the needs of farmers and aims to maintain the delivery of just-intime information to allow farmers to progress. We need farmers to be supportive of FAR in this vote.”

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Rural News // august 23, 2011

16 news goat vectors? GOATS EAT everything, and a lot of seeds that go in come out still viable, delegates at the pastures sessions of the conference heard. Work at Massey found that of eight weed species ingested in a molasses mix, dock, gorse and Californian thistle grew straight from the dung. The other thistle seeds were mostly destroyed. Reporting the work, Kerry Harrington pointed out feral goats can travel up to 9km a day, and therefore can spread viable seed over considerable area.

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No quick fix for pasture persistence SUE ED M O N DS

WHEN IT comes to bugs and weeds in pasture, Mother Nature appears to be getting one over on farmers, judging by a pasture persistence session at the recent Plant Protection Conference, Rotorua. It painted a gloomy outlook for current control methods. Argentine stem weevil in its various incarnations continues to ravage ryegrass, causing losses estimated at $78-151 million/year. Alison Popay, AgResearch, says though a useful parasitoid was introduced in 1991, there’s little knowledge about its population now. Where it is found it appears to be doing its job, but farms are still at risk of infestation by the weevil if the wrong endophyte, an Italian, or some of the tetraploid grasses are used. Ensuring the parasitioid is present and using the right endophyte (AR37) is key to pasture surviving the weevil onslaught, she says. In the north, black beetle is a scourge because of temperatures generally over 12.8ºC. Recent La Nina systems have increased outbreaks and many chemicals used to battle the beetle since the 1950s are now banned. Tina Eden of AgResearch says recent trials applying currently approved products, spring or autumn, had little effect with timing of application and product making little difference. Pasture mixes including herbs such as plantain and chicory have had some success in getting pasture to persist through weather variations such as unexpected droughts in trials in Northland, Taranaki and Canterbury, says AgResearch’s Catherine Tozer. However, in Bay of Plenty the herbs outgrew and reduced the ryegrass. More research is needed to work out why, she says. Tozer says analysis of seedbanks under pasture show weed species dominate, probably because of the trend to silage rather than hay. What effect this is having on persistence needs investigating, she suggests. Work on using fungi as weedkillers was described by Graeme Bourdot of AgResearch at the conference. Sclerotinia sclerotiorum is currently available as a granule for control of pasture weeds, but it’s expensive. Trials with a gel form in glasshouse experiments on five common weeds (winged, nodding and California thistle, ragwort and giant buttercup) worked well but more work is needed to optimise droplet size and density, as well as suitable application methods, he says. Carrie Lusk, also from AgResearch, says giant buttercup, already a serious weed in Taranaki and Golden Bay and spreading, is causing up to 36% production losses in infested pasture. Various herbicides have been tested, with flumetsulam giving the best result, but none really did the job and her research group says a biocontrol is needed to prevent the weed causing losses nationwide. • More on pasture persistence, page 32

Playcentres escape Government cuts vivienne haldane

RURAL MUMS say they are relieved playcentre funding will be spared Government’s axe. An Early Childhood Education (ECE) taskforce recommended slashing funding up to 63%, a death blow to all but a few of the 489 centres, the Federation of Playcentre Associations feared. Rural communities would have been particularly hard hit as in many areas there is no alternative for pre-schoolto page 17

Rural News // august 23, 2011

news 17

DairyNZ ups training effort SUE E DM O NDS

DAIRY NZ is lifting its involvement in farm training, and says it’s starting to pay dividends. Calving, a difficult time on any farm, is widely reported as going better than ever before. Why? DairyNZ farming trainer Chris Leach puts it down to recent Stock Sense Calving Workshops run around the country by the animal husbandry and welfare team. “We expected to get about 500 attending but we got 1300 and had to increase the number of workshops by seven to twenty-one.” DairyNZ’s first sortie into training, as against extension, was last year’s Milk Smart programme.

Small groups got practical demonstrations on how to reduce milking times. It also introduced workers and owners to the principles of ergonomics. Injury and health problems from milking work are widespread, and participants were shown ways to reduce stresses which wear body parts. Calving workshops have taken the concept further: different events for farm workers and farm employers, including managers. Workers got opportunities to learn about stages of labour, calving positions and husbandry techniques for calving cows. These included simulated hands-on experience of calf birthing positions and how to correct them, using

painted plastic barrels and calf cadavers, plus lots of shoulder length gloves. For the employers the training was about how to supervise workers, make up reasonable rosters, ensure staff are fed and looked after and how to manage the whole operation over the period. Another series of MilkSmart workshops will be run late October to early December, this time aimed mostly at manager/ owner/sharemilker level, focused on cow behaviour and cow flow. Training in calf rearing, heat detection, mating and basic cow health, including condition scoring, are also planned, all to be pitched at two levels – staff and managerial. While some might

Hands on: practising calf manipulation at a recent workshop. Photo: Chris Leach, Dairy NZ.

think Dairy NZ is duplicating training already available through AgITO, Don Sneath, a director of the training organisation, says they’re pleased to see Dairy NZ offering training. “We are partly funded by DairyNZ and work closely with them on planning of training,” he told

Rural News. “Their training sessions are funded by the levy, which reduces the stress on our limited resources. The need for training in this industry is great, so useful training by DairyNZ cannot but help us all.” • Tips on making staff training stick, page 35.

Training credentials DAIRY NZ’s Chris Leach began his career as a farming trainer at an agricultural college in Maidenhead, UK. He further honed his skills as a VSA farming trainer in Tonga, and has helped train vet technicians at Wintec, Hamilton. He joined DairyNZ in January.

Rural playcentres escape cuts from page 16

ers and closures would have removed a key social structure. Education Minister Anne Tolley earlier this month ruled out cuts, even before the end of consultation. “This will not result in any funding cuts to playcentres or parent-led ECE services,” said Tolley. Maureen Woodhams, co-president of the Federation of Playcentre Associations, told Rural News Tolley’s assurance was a relief. “Children receive a high grade of education at playcentres and parents receive high quality support for their parenting.” Woodhams says it would have been impractical to cut funding of the most cost effective early childhood service. “Now we can get on with looking at the recommendations of the task force and work with the ministry to help early childhood education be as good as it possibly can for children and families.”

Matamata Playcentre mother Cathy O’ Callaghan told Rural News her concerns about the proposed cuts just before Tolley ruled them out. She highlights the role the centres provide in rural communities. “They’re fantastic for children and for rural women. There are seven playcentres within 20km of here and they and primary schools are often the community hub.” O’Callaghan says the centres “run close to the bone” financially already, and had the cuts gone through, “it would have really stretched us.” “I think government listened to us and responded quickly to our concerns.” Tolley says Government values a diverse ECE sector, including services such as those at playcentres where parents choose not to have fully-qualified teachers. “This is why we extended 20 hours’ ECE [funding] to playcentres and kohanga reo last year, something the previous Government refused to do.”

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Rural News // august 23, 2011

18 news

Rural voice on roading taskforce MA RY W I TS EY

A NEW taskforce to look at better ways to pay for road maintenance will have a strong rural voice if one of its members has his way. Southland District

Council chief executive Dave Adamson has been selected as one of six members on the Government’s new Maintenance Task Force. He wants to ensure the rural roading network, not just in Southland but nationwide, is

on Land Transport Funding to encourage initiatives in road maintenance and renewals that save money without sacrificing quality. “It’s important to be involved and to ensure a rural voice is heard in Wellington,” Adamson says.

protected. “It’s essential a rural voice is heard because our rural roads are the backbone of our export economy.” The taskforce has been set up with the new Government Policy Statement

“We collectively are looking forward to having input and trying to ensure a positive outcome at the end of the process.” Adamson understands roads; he needs to, with the Southland District Council responsible

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for the country’s largest roading network. He also knows without good roads the rural sector and the rest of the economy will suffer. “Road maintenance is critical to ensure those goods produced are able to make it to processing manufacturing and export destinations. “Maintenance is a big expenditure item for Southland and other rural authorities, so it is pleasing to see this task force has recognised the importance of having a rural presence involved.” The task force has a

design-and-build opportunities, joint funding with the private sector, experimentation with various gravels, joint service delivery with neighbouring local authorities and the New Zealand transport agency. “Roading is the Southland District Council’s largest rates expenditure item. Currently council is challenged to meet the local share. So any opportunities for cost savings should be good for the district, our ratepayers and the country. “I hope the outcomes are practical, applicable

Road Maintenance Task Force • Jim Harland (convenor), NZ Transport Agency regional director southern region, • David Adamson Southland District Council chief executive. • David Fraser Hastings District Council group manager: Asset Management. • Murray Noone Auckland Transport manager road corridor maintenance and renewals. • Geoff Swainson Local Government NZ manager development and infrastructure. • Cos Bruyn Roading NZ chair • Jeremy Sole NZ Contractors’ Federation chief excutive. • Tony Porter Association of Consulting Engineers NZ Transportation Group member. • Mark Kinvi NZ Transport Agency, Napier state highway manager.

wide range of representation, including local government, consultants, contractors and central government spokespeople. Adamson hopes for cost-saving initiatives. “This cross-section of people will form an excellent think-tank to look at opportunities, including shared services, shared governance, collaboration over contracts, new maintenance delivery models and bulk purchasing.” He suggests this is already happening in the South. “Southland has an excellent history of innovation in roading. Examples include exploring

and do not sacrifice the long-term integrity of our all-important roading network.” Transport minister Steven Joyce says the task force will identify opportunities for efficiencies in road maintenance and renewals. “It’s important to know the large amounts spent on roading each year will be invested sensibly, and we are seeking to increase the return on every dollar spent.” The task force will be fully established this month and will complete its investigations and publish its findings by April 2012.

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Rural News // august 23, 2011

20 world

$100m nicked off UK farms ALAN HARMAN

THIEVES ROAMING the UK countryside are stealing masses of goods – even barbed wire on fences, livestock, fuel and tractors. A report from the National Farmers Union Mutual Insurance Society Ltd (NFU Mutual), the main rural insurer, says

NFU Mutual’s response is sponsorship of a police unit to co-ordinate national and international operations to catch thieves. And it offers to discount premiums up to 27.5% if farmers fit approved security such as used by the construction industry, plus immobilisers and trackers. Livestock rustling is

theft rose 17% last year to $99.4 million (£49.7 million). Tractor theft claims have increased 64% in two years. Stolen machines are exported from channel ports around the globe. Tractor claims on NFU Mutual rose 8% in 2010. The cost of claims rose 21%; they’re targeting more expensive tractors.

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higher because as the report covers only twothirds of British farmers. Minced lamb prices have jumped 30% since 2008 and sheep now sell for an average $148.50 (£75), doubling in the last three years. Farm diesel and domestic heating oil claims have shot up since the cost of oil surged late 2010.

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is less chance of thieves being seen. Some 23% thought relaxed attitudes towards security could be contributing. NFU Mutual chief executive Lindsay Sinclair says new rural security efforts across the country are involving rural dwellers and insurers. “We’ve seen that by working with police and manufacturers, tractor theft and organised rural crime can be tackled headon. A united front against crime in the countryside will help to protect communities from being targeted.”

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Claims for stolen heating oil rose 166% in January alone. Also rising are thefts of high-price items easy to carry and sell. Chainsaws, electric drills and lawnmowers top the most-stolen list. The thieves also steal barbed wire from fences to sell as scrap. Most felons work the nightshift – midnight to 6am. Why do thieves target the countryside? NFU Mutual was asked. The answer, 41% of NFU Mutual branches, is sparse regions are difficult to police; and 32% say there

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THE NUMBER of British dairy farmers planning to quit the industry in the next two years has risen to 13% from 9% a year ago. This equates to 1,628 dairy farmers, or 2.2/ day compared to 1.6/day in the levy body DairyCo’s 2010 survey. Confidence is also down, with only 6% planning to invest more than £250,000 ($500,000) in the next five years, from 9% last year. “With 13% of farmers intending to leave the industry, there is a concern that Britain will stand to lose milk production capacity if there is not sufficient investment,” says DairyCo senior analyst Matt Johnson. The survey estimates British milk production could fall by up to 4% within two years. However, results from previous surveys show actual effects on production are often less than predicted. Of 1200 farmers surveyed, 600 were in England and 200 each in Scotland, Wales and Northern Ireland. Owneroccupiers made up 69%, tenants 16%, and 13% were part owned, part tenanted. Only 32% of farms had more than 200 cows, 38% had 100-199, and 24% less than 60. The 2010/11 milk year in the UK was good, with favourable weather and prices pumping output up 3.2% on the previous year and 2.4% above the three-year mean. When the survey was carried out, UK dairy prices were at record levels and 36 of the 38 milk contracts monitored had seen price increases in the previous months. On the flip side, farmers were also contending with increased fuel, fertiliser and feed prices.

Rural News // august 23, 2011

world 21

USDA says sheep farmers have cause for optimism ALAN HARMAN

DESPITE LARGE falls in sheep numbers over the past 25 years, the US Department of Agriculture is optimistic about the American sheep industry. Sheep numbers have declined for 20 years, but recent declines have been less drastic, and some growth has occurred. Sheep and lamb prices are record. In a review of the American sheep industry over the last 25 years, the USDA’s National Agricultural Statistics Service says sheep are ideal for small acreages. And most sheep farms raise fewer

than 100 stock. “Growth of the industry will rely on smaller operations growing and introducing people to the industry, while tapping into local niche markets for lamb and mutton, wool, and dairy products,” the report says. “With declining wool demand and production, because of synthetic fibres, some producers have moved to raising hair sheep, which require little or no shearing, while still producing high-quality carcasses.” NASS says one important aspect of the sheep industry often overlooked is their value in grazing

vegetation. Sheep help prevent wildfires by eating grass and brush. They also help control invasive and noxious weeds on public and private land. There were 81,000 sheep operations in the US last December. The sheep and lamb inventory was estimated at 5.5 million. Wool production in the US has fallen 64% since 1987. Sheep numbers have steadily decline since peaking at 56.2 million in 1942. Many cycles have occurred during the past century. About 1900, sheep numbered 48 million. By 1940, there were

52 million. Numbers fell following World War II, to 30 million in 1950. During the 1950s, sheep numbers first plateaued then grew a little until 1960. In the 1960s, numbers fell each year to 21 million. The decline went on in the 1970s: by 1979 there were 12 million. The 1980s began with growth in the first three years, then four years of decline. By the end of the 1980s, sheep numbered about 11 million. Decline continued in the 1990s, to 10 million in 1994. From start to finish, the 20th century saw sheep numbers decline to 86%.

Sheep help control invasive and noxious weeds on public and private land, says the USDA.

Then in 2005, sheep numbers rose for the first time since 1990, and inventory increased in consecutive years (2005 and 2006) for the first time since 1987 and 1988. Slaughter of sheep and lambs has fallen 52% since 1987. The late 1980s and early 1990s saw more sheep slaughtered. But

since 1992 slaughter numbers have declined. During 2010, 2.6 million sheep and lambs were slaughtered in the US. Sheep and lamb gross income and cash receipts were fairly constant over the past 25 years, ranging from $US400 million to $US650 million. Although sheep numbers have declined, prices and

slaughter weights have trended upward, holding gross income around $500 million. The US has been a net exporter of live sheep for 20 years, mostly to Canada and Mexico. The 2007 agricultural census showed sheep and goat sales value rose to 30% above the 2002 census ($704.9 million).

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Rural News // august 23, 2011

agribusiness 23

Early start key to succession plan MA RY W I TS EY

MANY FARMERS leave succession planning too late to tackle it successfully. That was a key message earlier this month at a packed Beef + Lamb New Zealand farm succession seminar in Southland. “You should start planning for succession the day you buy the farm, or at least the day you have your first child,” property consultant and succession planning specialist Phil Guscott, of Wairarapa, told the 130 farmers attending. Besides starting planning early, ensure the business is worth handing on and make sure everyone knows where they stand. It’s simple advice, but not often heeded. Handing the business on to the next generation is a sensitive process, he stresses. “Never underestimate the emotional impact; it’s like cutting off your leg.” A poorly negotiated farm succession process had a substantial impact on his family. For succession to work, emotion must be set aside and good business practice enforced, he says. “Any decision must be economic for the retiring and the farming generations. There must be a plan for the non-farming members and everyone must agree. “You’ve got to be realistic: is there a business

there? You shouldn’t set up the next generation to fail.” This means the farm and its assets need to be realistically valued, while debt servicing capabilities must also be calculated. “It’s got to be bankable.” Provision also needs to be made for the retiring couple, including a house and income. He estimates capital of $2.6-$3 million is needed, with a house costing $500,000-$1 million and income of $100,000 per annum coming from $2 million invested at 5%. A family meeting is the best vehicle for discussion, he says. “It’s about setting the goalposts.” From there accountants and lawyers need to be consulted. Executing the planned process mustn’t be left too late. “Succession should be done in your 50s and 60s, not your 70s and 80s. You get into a mess if you leave it too late.” Most famers have only 25-30 years before the next generation wants to take up the reins, and farming is a young man’s game, he adds. “Don’t go into partnership with the retiring generation; it’s doomed to fail.” He also points out farm succession can mean different things to the next generation, depending on the choices they make. “The farming child gets to live cash poor. He’s

Succession plan pointers

• Must be economic for all parties, including retirees. • Include non-farming family members. • Shared vision needed across family. • Value assets realistically. • Don’t underestimate the emotional impact.

just a tenant on the farm for his lifetime, before he passes it on to the next generation.” The remaining children have different options. “The non-farming child has the freedom to build

up a career knowing there’s a lump of capital coming eventually.” He recommends raising children with realistic expectations about succession to avoid disappointment and family

disputes. “In this world, the most important people are your family. Manage their expectations, because this is often where the currents start.”

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Rural News // august 23, 2011

24 agribusiness

Downgrades, PIIGS and OCRs THE GLOBAL economic landscape over the past few weeks has been tumultuous, leading some commentators to forecast recession in the US and Europe. The precursor to these events had been building for some time. US debt ceiling negotiations went down to the wire, diverting attention from Europe, where the European Central Bank (ECB) was threatening to hike interest rates, rather than address the solvency issues of the PIIGS (Portugal, Italy, Ireland, Greece, Spain). All this caused turmoil in the Spanish and Italian bond markets. Back in the US, just as the mood settled, ratings agency Standards & Poors downgraded the US credit rating. The brunt of the market’s ire was initially directed at the US and UK, and both governments have responded with plans to address fiscal largesse – even if the US plan didn’t avert a downgrade. Recently, the EU has said Spain and Italy don’t need aid, and that declara-

tions by the ECB, G7 and G20 will bring back confidence. This is despite government debt in PIIGS standing at about €3.4 trillion (NZD5.9 trillion). As a result, the market has little confidence Europe has a plan to stabilise the region’s economy or, if

financial focus Con williams

a plan is implemented, that it will enable robust growth. It is almost inconceivable Europe and the US will stand by while markets burn. Their response will need to be comprehensive and timely to stop the rot. Even then it will not change our core economic anchor: slow growth will be here for some time. What does it mean for New Zealand? Whatever happens, we expect more caution on the part of the RBNZ, which means the official

Rural News 16x3 Dairy News

cash rate (OCR) on hold until later in the year, with a hike still on the cards for December. Remember, the RBNZ has made it clear market stability was a pre-condition for raising rates, noting during the July OCR review that it would only raise rates “provided current global financial risks recede”. Eventually rates will move up but it will be an elongated and stop-start tightening cycle. Markets remain confident about New Zealand Inc and the national balance sheet has improved massively since 2008. We repaid debt (net external debt has fallen from 90% to 75% of GDP) while other nations simply shuffled it from the private to the public sector. Banks here remain strong and well-capitalised. Government debt is also low by international standards and, although volatility is severely testing the idea, New Zealand is regarded by many as a sort of safe haven. We suspect it will remain that way, but all eyes will be on Asia, for it is critical Asia remains strong.

Notice of Elections Fonterra Co-operative Group Limited Board of Directors, Shareholders’ Council, Directors’ Remuneration Committee Notice is hereby given that the following three elections will be held concurrently in 2011 for Fonterra Co-operative Group Limited. Board of Directors: Election of Three (3) Directors Shareholders’ Council (13 Wards): Election of One (1) Councillor in each ward Directors’ Remuneration Committee: Election of Two (2) Members

Invitation for Candidate Nominations Nominations are called for candidates to stand for these three elections. Fonterra shareholders are eligible to stand for all three elections. Nomination forms and candidate handbooks can be obtained from the Returning Officer. Nominations must be received by the Returning Officer by 12 noon on Friday, 9 September 2011.

Markets are not confident Europe has a plan to stabilise the region’s economy.

Where to from here? Until the volatility subsides, we favour taking advantage of low floating rates, which look like they will persist. We have been consistent in our view that we aren’t out of the woods yet, and that the recovery would be buffeted by bouts of storms. Hence

we stopped short of favouring all-out fixing as have some other commentators. Right now we are in a storm, and we’d prefer to sit it out, and concentrate on business fundamentals, not trying to get clever about interest rate hedging. Extending the duration of some borrowings may

Elections Voter packs will be posted to shareholders on Thursday, 20 October 2011. The elections will be conducted by internet, fax and postal voting, using the Single Transferable Vote (STV) method. Voting papers must be in the hands of the Returning Officer by 10.30am on Tuesday, 15 November 2011. Warwick Lampp, electionz.com has been appointed as the Returning Officer for the 2011 Fonterra Elections. For further details, call the Election Hotline on freephone 0508 666 446 or contact the Returning Officer at elections@electionz.com. Warwick Lampp Returning Officer – 2011 Fonterra Elections Email: elections@electionz.com Election Hotline: Freephone 0508 666 446

does not take into account your financial situation or goals, and is not a personalised adviser service under the Financial Advisers Act 2008. It is recommended you seek advice from a financial adviser which takes into account your individual circumstances before you acquire a financial product.

Farm prices lowest since 2003 AFTER A few months of slightly higher turnover, farm sales volume – and values – slumped in July, but turnover is still higher than a year ago. Real Estate Institute of New Zealand reports 301 sales in the three months to the end of July, compared with 393 in the three months to June and 262 a year ago. Median price in the three months was $14,649/ha, the lowest since September 2003. In the three months to June it was $15,568/ha and $17,901/ha a year previously. “The decline in the median price per hectare reflects the lower number of dairy farms sold during the winter

period,” says REINZ rural market spokesman Brian Peacocke. “Famers are keenly watching events in financial markets and the trend in the New Zealand dollar. The high dollar over the past few weeks is causing some concern, however, the outlook for the currency is difficult to predict and the situation – particularly in respect of the United States – remains volatile. Nevertheless, forward enquiry for quality properties remains positive.” As in recent months, most activity was in grazing, finishing and dairy support properties. Canterbury, Otago and Southland led the trade.

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Elections for Shareholders’ Councillors Elections will be held in the following 13 wards for the Shareholders’ Council: Ward 1 Northern Northland Ward 4 Southern Northland Ward 7 Coromandel Ward 10 Te Aroha Ward 13 Matamata Ward 16 Rotorua Ward 19 Taupo Ward 22 Central Taranaki Ward 25 Northern Manawatu Ward 26 Hawke's Bay Ward 28 Wairarapa Ward 31 Central Canterbury Ward 34 Eastern Southland

look attractive now, but we urge farmers to seriously consider whether they have the fortitude to introduce fixed costs to their business at times of uncertainty such as these. • Con Williams is rural economist at ANZ. con.williams@anz.com This article is intended to be of general nature,

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Rural News // august 23, 2011

agribusiness 25

Hort co-op not on the agenda SUD ES H K I SSU N

GROWERS MUST work together against rising global competition, says Horticulture New Zealand chief executive Peter Silcock. But a grower cooperative is not on its agenda. As an umbrella industry body, Hort NZ encourages growers to work together, he says. “Forming a grower co-op is a commercial decision members need to take,” he told Rural News. “It is not something Hort NZ should be doing. But if growers want a co-op we’ll happy to facilitate it.” He was commenting on a Rabobank report highlighting growing competition in the horticulture industry. Its co-author, senior analyst Marc Soccio, says growers face evolution of consumers, grocery retail market dynamics and global trade. Not only do growers need to Peter Silcock make fruit and vegetables more convenient to eat, they must make maximum use of their resources and relationships, he says. “It seems old-fashioned to talk about cooperatives, but when they’re managed well, they can add value for primary producers.” Silcock agrees growers face stiff competition from Chile, South Africa, Argentina, Peru, China and Vietnam. Growers there pay less for land and labour. New Zealand growers must add value to products to ensure they fetch premium prices, he says. “At the same time we must work together and creating scale.” Soccio says the Rabobank report shows growers are

Record $72m result for Ravensdown HOT ON the heels of Ballance Agri-Nutrients’ record $86m operating profit (Rural News, Aug 2) Ravensdown has weighed in with a $71.6m figure, 260% up on last year despite difficult markets across the ditch. “In Western Australia the droughts continued, breaking only after the end of our financial year,” says chairman Bill McLeod. “In Queensland we had the opposite situation where we had the worst rainy period growers could remember, resulting in a lot of sugar cane not being harvested and little fertiliser being applied.” Nonetheless an $11.2m loss before tax in 2009/10 was reduced to $1.6m and general manager marketing Mike Witty says the foundations have been laid for a positive future there. Ravensdown’s revenue for 2010/11 increased 12% to $933m with 1.492mt of fertiliser sold, a 14% increase reflecting resurgent returns in New Zealand meat, wool, dairy and arable. Witty says just under 20% of sales were in Australia, and about 20% of that business was in New Zealand-made product. Agchem and animal health operations are still a relatively small part of Ravensdown’s business, adding “probably just under 10% of that (profit) result.” The cooperative continues to look for acquisitions such as the C-Dax deal it announced August 1, but they “have to fit and add value to the business,” stresses Witty. An expansion of its phosphate operations at Clarendon, Otago, is planned but development of lignite reserves in Southland with Solid Energy is more “in the medium-term.” “There’s still a reasonable way to go on that.”

seeking strategies to add value to their produce in the face of rising input costs and downstream buyer power. “In many cases it’s as much about communicating value as about delivering value to consumers. “Almonds and mushrooms have benefitted from wellresourced and executed marketing, whereas organic producers seem to find difficult to reinforce their message with mainstream consumers.”

Rural News // august 23, 2011

Market Snapshot North Island

South Island

Change c/kg

Last Week

Change c/kg

Last Week

Lamb - PM 16.0kg

n/c

7.58

-5

7.43

Steer - P2 300kg

4.20

n/c

4.00

c/kgCWT

Lamb Market Trends

Meat

Bull - M2 300kg

4.00

n/c

3.85

Venison - AP 60kg

8.30

8.70

Lamb Prices

Mutton SI Lamb

$3.5 May $8.5

Jun

Jul

Aug

Sep

Oct

5.18

P2 Steer - 300kg

4.20

4.15

4.10

7.58

5.40

M2 Bull - 300kg

4.00

3.98

3.97

PX - 19.0kg

n/c

7.60

5.41

P2 Cow - 230kg

n/c

3.30

3.22

n/c

7.61

5.41

M Cow - 200kg

n/c

3.10

3.12

MX1 - 21kg

n/c

4.55

3.25

Local Trade - 230kg

+10

4.25

4.15

4.30

-5

7.43

7.48

4.89

P2 Steer - 300kg

n/c

4.00

3.75

PM - 16.0kg

-5

7.43

7.48

5.46

M2 Bull - 300kg

n/c

3.85

3.53

PX - 19.0kg

-5

7.43

7.48

5.47

P2 Cow - 230kg

n/c

3.00

2.60

PH - 22.0kg

-5

7.43

7.48

5.47

M Cow - 200kg

n/c

2.90

2.52

n/c

4.28

3.10

Local Trade - 230kg

n/c

4.20

4.00

Change

2Wks Ago

3 Wks Ago

Last Year

5yr Ave

Aug

Sep

Oct

100

Cattle NI

-12%

15.3

17.3

12.5

Cattle SI

+14%

4.2

3.7

3.3

2.9

Lamb NZ

+7%

216

203

137

153

Cattle NZ

-7%

19.5

21.0

15.8

16.3

Mutton NZ

-23%

Bull NI

-35%

1.5

2.3

1.0

1.5

Bull SI

0.3

0.2

0.3

Str & Hfr NI

-13%

8.9

10.2

6.9

7.5

Str & Hfr SI

+16%

2.9

2.5

2.1

Cows NI

+2%

4.9

4.8

4.6

4.5

Cows SI

+11%

1.0

0.9

0.6

Last Year This Year

NZ Weekly Beef Kill

0 May

Jun

Jul

Aug

Sep

Oct

Export Market Demand

$4.0

Last Week

2 Wks Ago

Last Year

5yr Ave

n/c

2.45

1.81

1.41

+13

10.61

10.48

8.74

8.05

$5.0

20 0 May

Jun

Jul

Aug

Sep

Oct

Last Week

2 Wks Ago

Last Year

5yr Ave

n/c

1.98

1.71

1.58

5.28

5.21

5.28

5.01

Change 95CL US$/lb NZ$/kg

£2.00

Oct

£1.50 May

South Island 300kg Steer Price

$2.20

Jun

Jul

Aug

Sep

Oct

Demand Indicator - US 95CL Beef

$2.00 $1.80

Procurement Indicator

$4.0

Change

$3.5

5yr Ave Last Year This Year

$3.0

Jun

Jul

Aug

Sep

Oct

$1.60

2Wks Ago

3 Wks Ago

Last Year

5yr Ave

% Returned NI

-1%

72.6%

73.5%

62.9%

47.2%

% Returned SI

-1%

70.7%

72.0%

63.5%

59.0%

80%

North Island 60kg Stag Price

This Year

$1.20 May

Jun

Jul

Change

60%

Aug

Sep

Oct

2Wks Ago

3 Wks Ago

Last Year

5yr Ave

% Returned NI

-1%

75.4%

76.2%

74.78%

75.2%

% Returned SI

-2%

72.9%

74.9%

66.8%

67.8%

Last Year This Year

50% May

$7.5

Last Year

$1.40

Procurement Indicator

Procurement Indicator - North I.

70% $8.5

This Year

Export Market Demand

This Year

£2.50

$4.5

$2.5 May

Last Year

$3.5

Sep

Demand Indicator - UK Leg Price

£3.00

Aug

13.4

NZ$/kg

Jul

5yr Ave

UK Leg £/lb

Jun

Last Year

144

$4.5

$2.5 May

3 Wks Ago

Change

$3.0

2Wks Ago

145

North Island 300kg Bull Price

5yr Ave Last Year This Year

Change

+1%

150

Jul

1000s

Estimated Weekly Kill

+21%

$5.5

Jun

NZ Slaughter

Estimated Weekly Kill

450

5yr Ave Last Year This Year

Lamb SI

300

$5.0

7.56

7.58

Lamb NI

$6.5

$3.5 May

7.56

NZ Weekly Lamb Kill

$4.5

Last Year

n/c

MX1 - 21kg

South Island 16.0kg M Lamb Price

$7.5

2 Wks Ago

n/c

1000s

$4.5

Last Week

Change

c/kgCWT

PM - 16.0kg

NZ Slaughter 5yr Ave Last Year This Year

Last Year

YM - 13.5kg

Mutton

$5.5

2 Wks Ago

PH - 22.0kg

$8.5

$6.5

Change

Last Week

YM - 13.5kg

North Island 16.0kg M Lamb Price $7.5

Beef Prices

c/kgCWT NI Lamb

Beef Market Trends

Jul

90%

Procurement Indicator - North I.

85%

Sep

80% 75%

$6.5

$5.5 May $9.5

5yr Ave Last Year This Year Jun

Jul

Aug

Sep

Oct

South Island 60kg Stag Price

85%

Procurement Indicator - South I.

70%

Last Year

75%

This Year

65%

$8.5

95%

Jul

Sep

5yr Ave Last Year This Year Jun

Jul

Aug

Sep

Oct

Change

This Year Jul

Sep

Procurement Indicator - South I. Last Year This Year

85% 75%

Venison Prices $7.5

$6.5 May

60% May

55% 45% May

Last Year

65%

Last Week

2 Wks Ago

Last Year

5yr Ave

NI Stag - 60kg

8.30

8.25

7.05

6.74

SI Stag - 60kg

8.70

8.65

7.30

7.06

65% 55% May

Jul

Sep

Beef & venison prices are reported as gross (before normal levies & charges are deducted). Lamb & mutton prices are reported nett (after levies & charges are deducted). Note: Freight is paid in the North Island but not by all companies in the South Island.

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Rural News // august 23, 2011

Beef Wool Price Watch Cattle prices looking firmer Export cattle slaughter prices firmed slightly in the North Island last week. Stronger Local Trade pricing levels are keeping the pressure on export prime steer prices which resulted in a 5c/kg lift on average for this class of cattle. There was also a slight upward movement in bull prices. Overall 300kg cwt steer prices are now averaging $4.20/kg while 300kg cwt bull prices have firmed to $4.00/kg. The flow of cattle coming into processing plants in the North Island continues to drop to winter low levels. Export cattle prices are held steady in the South Island last week. 300kg cwt steer prices averaged $4.00/kg however there is a wide variance of prices being offered with upwards of $4.10/kg achievable. 300kg cwt bull prices are steady on $3.85/kg. Reports indicate there are very limited cattle coming through for kill on the spot market with mostly contract cattle taking up most of the space. Volatile dollar makes trading a hard job New Zealand’s competitiveness on the global beef market has improved with the recent easing in the dollar. However some overseas buyers are playing on this fact and have pulled back offers as a result. Bids for US95CL bull meat have been softer in the last two weeks though most New Zealand exporters refused these offers on the back of seasonally low supplies. Actual sales were more in the vicinity of US$1.98/lb for US imported 95CL bull and US$1.86/lb for US imported 90CL cow. The volatility in the currency markets is making beef buyers a bit gun-shy. Most don’t want to be caught with expensive product so they could choose to sit on the sidelines until the dust has settled which may limit trading in the weeks ahead.

Lamb

Dairy Price Watch Last 2 Wks

Prev. 2 Last Year Wks

Change

11-Aug

Coarse Xbred Indic.

6.02

5.93

3.44

Butter

-2

5432

5434

5432

Fine Xbred Indicator

+14

6.36

6.22

4.04

Skim Milk Powder

-14

4410

4424

4074

Lamb Indicator

5.73

Whole Milk Powder

-58

4344

4402

4332

Mid Micron Indic.

9.55

6.99

Cheddar

5204

5199

5363

Indicators in NZ$

04-Aug Last Year

Indicators in NZ$/T

Wool Indicator Trends

750

Dairy Prices Trends

7,000

650

Change

6,000

550

5,000

450

4,000

350

CXI

250 Aug

Oct

Dec

FXI

Feb

Apr

3,000 Aug

Jun

Coarse Xbred Indicator

750

SMP But.

LI Oct

Dec

Feb

WMP Ched.

Apr

Jun

Whole Milk Powder Price (NZ$)

6,500

Last Year This

Last Year

650

This Year

550

5,500

450

4,500

350 250 May

Jun

Jul

Aug

Sep

3,500 May

Oct

Overseas Price Indicators

-125

4550

4675

3950

2.89

Skim Milk Powder

-112

3694

3806

2963

Whole Milk Powder

-149

3639

3787

3150

Cheddar

-114

4359

4473

3900

4.88

Fine Xbred Indicator

-22

5.15

5.37

Lamb Indicator

4.95

Mid Micron Indicator

8.25

5.01

04-Aug Last Year 5.12

Indicators in US$/T

2.46

Wool Indicator in US$

South Island lamb prices remain soft 585 Export lamb prices in the North Island held steady last 485 week with a 16kg cwt lamb earning $7.56/kg (nett). The 385 number of lambs coming forward for kill remains well 285 CXI FXI LI above last years levels with cropping farmers adding to 185 the mix as they quit stock to make way for new plantings. Aug Oct Dec Feb Apr Jun Export lamb prices in the South Island eased again last week with a 16kg cwt lamb now averaging $7.43/kg nett. Coarse Xbred Indictor in US$ 750 Supplies are well above average levels for this time of the Last Year year and this combined with the erratic dollar continues This Year 550 to pressure the market. Heavy weight lamb prices take a pounding 350 The message from meat companies appears to be getting 150 through with lamb slaughter rates lifting again. In the past May Jun Jul Aug Sep Oct few weeks, export prices for lambs over 22kg cwt have come under significant downward pressure. Its expected most of the increase in the weekly kill rates can be put down to traders offloading their heavy end lambs to beat further price drops. The South Currency Watch Last 2 Wks 4 Wks Island lamb kill is estimated to have lifted to over 70,000 head, well up on vs. NZ Dollar Week Ago Ago last years levels while the North Island lamb kill is holding at around US dollar 0.826 0.838 0.842 145,000 head, 55,000 head above on this time last year. Average Euro 0.582 0.594 0.595 slaughter weights in the South Island have lifted to over 20kg cwt up from UK pound 0.509 0.515 0.521 18kg this time last year while average North Island slaughter weights are Aus dollar 0.800 0.800 0.785 up by 1.6kg on last year, further supporting the suggestion the kill is being Japan yen 63.50 65.84 66.64 fuelled by the heavy weight lambs. Manufactured dairy prices remain under pressure New Zealand’s new season of milk production is underway. Producers are still projecting a 3-5% increase in milk volumes in the 2011/12 season with optimism rife following a positive end to last season. Much of the first half of the new season’s milk production for Oceania has been committed to regular and ongoing customers needs. This is following expected patterns. Unfortunately prices for manufactured dairy products are starting off on the back foot with prices still under pressure.

5,000 4,000 3,000

SMP But.

2,000 Aug

Oct

Dec

Feb

WMP Ched.

Apr

Jun

Whole Milk Powder Price in US$/T

4,200 4,000

Last Year

3,800

This Year

3,600 3,400 3,200 3,000 May

Last Year

0.95

0.714

0.85

0.555 0.457 0.792 61.46

Last Year This Year

Jun

Jul

Aug

Sep

US Dollar Last Year This Year

0.75 0.65 May

0.55

0.60

Prev. 2 Last Year Wks

Dairy Prices in US$/Tonne

6,000

Euro

Jun

Jul

Aug

Sep

Jun

Jul

Aug

Sep

Oct

UK Pound

0.50 0.45

0.55 0.50 May

Oct

Butter

-24

0.65

Sep

Last 2 Wks

Coarse Xbred Indicator

Dairy

Aug

Change

11-Aug

685

Jul

Overseas Price Indicators

Change

Indicators in US$/kg

Jun

0.40 May

Last Year This Year Jun

Jul

Aug

Sep

Oct

Rural News // august 23, 2011

28 opinion editorial

edna

Milk price politicking SO PARLIAMENT’s commerce select committee is going to investigate retail milk pricing. The power of the ballot box to turn politicians’ spines to rubber never ceases to amaze. There can be little doubt National’s acceptance of Labour and Green Party calls for such an investigation is because an election is looming. It doesn’t want to appear to be standing up for perceived high prices of a basic staple, and – as the opposition and others would have you believe – profiteering by the country’s biggest company and its dairy farmer shareholders. The fact Fonterra has to supply other processors with up to 600 million litres of milk at just 10 cents over the milk price it pays its shareholders seems to have been lost in most of the media hype. It’s also disappointing that the public, or at least mainstream media, seem to have taken it as read that milk is expensive. Comments such as Green MP Sue Kedgely’s claim that milk is “unaffordable to many people living in New Zealand” would be better turned around: many people in New Zealand can’t afford not to be drinking milk. Farmer and Fonterra representatives have pointed out analogies with fizzy drinks are inappropriate, but the more they protest this point, the more the mainstream media seem to like to make the comparison, which, if you think about it, is actually good for milk. Every time that analogy is made is a golden opportunity to advertise the excellent value for money that milk is. Maybe these comparisons show there’s a need for more generic milk marketing in New Zealand like the UK’s White Stuff campaign, which featured David Beckham, among others, with milk ‘moustaches’. Richie McCaw could make milk similarly cool here. An interesting, if somewhat unoriginal, suggestion to surface from the furore is a mass boycott of milk for a week. “This will bring home to those who [are] reaping large profits at the expense of the consumer just who is actually in charge,” wrote one correspondent to a Fairfax paper. It would, but the result wouldn’t be what the writer intended. Retailers and wholesalers would build a risk premium into the price of milk to allow for the increased unpredictability of demand such stunts create. Prices would go up. That the Commerce Commission felt it couldn’t mount a retail milk pricing inquiry suggests its powers need reviewing. The contrast with the UK’s Office of Fair Trading, which has just dished out nearly $100m in fines to nine supermarkets and dairy processors for collusion over pricing, is striking.

Rural NEWS Head office Postal address: PO Box 3855, Shortland Street, Auckland 1140 Publisher: Brian Hight...................................................... Ph 09 307 0399 General Manager: Adam Fricker.................................................... Ph 09 913 9632 Editor: Andrew Swallow............................................. Ph 03 688 2080 editor@ruralnews.co.nz................................... Ph 021 745 183

“Blokes won’t be made to wear them in the same place as boy lambs will they?”

the hound Lap-dog tag hard to shake FONTERRA HATES the suggestion its shareholder councillors are mere lap-dogs to the main board, but from what your old mate has heard behind the cowsheds, that’s exactly what some of the bigwigs are trying to make the grass roots’ representatives. The fact that the council recently sought a communications officer, but only offered the most junior of packages, shows the short leash the council is being given these days. The cooperative’s metamorphosis to “corporative” seems to be gathering pace.

Want to share your opinion or gossip with the Hound? Send your emails to: hound@ruralnews.co.nz

Dumbing down of directors IS IT me, or is every other middle manager a ‘director’ these days. Once upon a time the title was reserved for those on boards, but in the world of pumped-up job titles it seems every Tom, Dick, or Harriet has become a director of something or other. Yours, the Director of Cynical Canine Communications, Rural!

Picking season pun

Misleading Mapp-ing

APPARENTLY AFTER the kiwifruit picking season was over, orchards were hiring staff for picking lemons. “Have you had any experience picking lemons?” asked one prospective employer of an applicant. “I’ve been married and divorced three times, bought a new car that was recalled and voted for Phil Goff. Is that enough?”

YOUR OLD mate’s prize for most misleading media release of the month has to go to Science and Innovation Minister Wayne Mapp. Last week he dished out what appeared to be $50 million in Technology Development Grants. Turns out they’re like the supermarket offer where you have to buy one to get another half price – only worse. Companies must spend $5 on approved R&D to get $1 back in grant funding. So it’s actually only $10m, isn’t it Dr Mapp?

Black marks for black shirt England WHAT DOES England think it’s playing at, choosing black as the change strip for the Rugby World Cup? Traditionally the poms use red or blue as their alternative hue. But black – where did that come from? If they’re mimicking the All Black strip, I suppose we should be flattered, but you’re old mate feels it’s more of an insult. Here’s hoping the stunt backfires in their RWC opener with the Pumas. If it does, Scotland could KO the ‘auld foe’ in Auckland and those pseudo-All Black Poms will be among the first packing. Go the Pumas!

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ABC audited circulation 80,327 as at 30.6.2011

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Rural News // august 23, 2011

opinion 29 English’s words a friendly warning to Fonterra? MALCOLM LUMSDEN (Rural News July 19) seems to consider Bill English’s comment that ‘Fonterra shareholders will have to learn to share raw milk with processors” as unfair advice. I don’t interpret English in that way. Rather I see it more as a friendly warning. I think he was really trying to say “Take care, Fonterra shareholders; remember

the special legislation of 2001? What the Government giveth, the Government can surely take away”. Lumsden… shows clearly he believes Fonterra is a monopoly, which of course it is. If any Fonterra shareholder believes Fonterra is not a monopoly, then I ask, what other chief executive of a company can declare a national price

freeze on milk? Then similarly declare cheese and butter, “will be reduced in price”? And evidently all this without consulting the retailers. That would be collusion. One of the main functions of a government must be to ensure citizens never have to suffer a commercial monopoly. Only a democratically elected government

ag twits

should have that monopoly power. When monopoly power is granted to a corporation only bad can come of it because that monopoly corporation will inevitably add unearned increment to the goods and services it produces. This attracts more consumer buying/employment power to itself. It is an absurd and evil tax on consumers and it steals

Rural News’ irreverent and hypothetical look at what’s happening in the farming world

spending power away from other sectors of the economy. Fonterra shareholders should take great care and make hay while they can. I predict they have less than six months more of adding unearned increment to dairy products. A decade of this absurdity is long enough. John Morrison Nelson

Top Bleats view all henryfonterra: Critics claiming Fonterra’s newly appointed chief executive-designate Theo Spierings is not a co-op man are talking double Dutch to me! dcarterminofag: World’s most astute agriculture minister sniffs the political wind three months out from the election and decides a select committee inquiry into milk prices is a good idea! #milkinquiry. jmasonfonterra: According to research commissioned by Fonterra, competition in NZ dairy processing has increased since Fonterra was created and the way it sets the farmgate milk price is sound. #milkinquiry. wyattcreechocc: According to research commissioned by OCC, competition in NZ dairy processing has decreased since Fonterra was created and the way it sets farmgate milk price is unsound. #milkinquiry.

ATV licence not what’s needed Regarding farm ATV licensing, I have been reading all the ways of helping stop ATV accidents and this one takes the cake. I ask FarmSafe national manager Grant Hadfield, is that the best you can come up with? Step back and think about it. The problem starts with people who know nothing about ATVs putting their heads together and coming up with bone-head ideas. Most of them wouldn’t know how to start a quad, yet they’re trying to make rules.

What’s the detail behind the accident statistics? How many [accident victims] are visitors to farms? How many accidents are due to faulty equipment? There will be a pattern.

Kevin Bryant to bring their ATV licence and spend a day with me on the farm so I can see what a difference it makes. After years of racing cars and moto-

How many years experience on ATVs do Hadfield and fellow licence instigator AgITO chief executive Kevin Bryant have? I’ve used ATVs pretty much since they first came out and have never had a major accident. Why? Because I respect them. The rider controls the ATV, not the other way around. Licences will not prevent accidents. Have car licences stopped them crashing? If we still used horses, people would still be getting hurt using them. I invite Grant Hadfield and

cross, and using ATVs on farm, if you think I’m going to accept the need for an ATV licence, think again. Paul Anthony Milton, Otago.

rnormangreenmp: I want to reassure all farmers my complete disdain and contempt for the agriculture sector will continue unabated in my new role as finance minister in the Green/ Labour coalition after the election.

Write and Win!

wpetersformermp: As New Zealand’s former foreign minister I want to make it clear that – in a desperate attempt to get re-elected – I will strenuously campaign against any Poms, Yanks, Chows, Wogs or Nips buying Kiwi farms. #keepingitkiwi

Got a gripe? Want to air an issue? Rural News welcomes your letters on all matters affecting farming and/ or the rural community. To boot, Skellerup has thrown in a pair of classic Redbands for one lucky letter writer every issue. So pull out the pen or keyboard and write, e-mail or fax The Editor.

sirmikefaymegarich@wpetersformermp: Winston, time to build a bridge and get over the Winebox thing. No doubt you will be backing my latest proposal to buy the Crafar farms! #keepitkiwi

The winner of this issue’s Redbands is Paul Anthony, Milton. Send to: Letter to the Editor PO Box 3855, Auckland 1140. Email: editor@ruralnews.co.nz. fax: 09-307 0122

snashlabourmp: Ironically I chair Labour’s provincial and rural caucus but I keep putting the boot into farmers for being bludgers and tax dodgers.

Correspondence should be brief and to the point. Rural News reserves the right to edit letters as necessary. Please supply name and locality for publication, plus contact details in case of need for clarification.

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Rural News // august 23, 2011

30 opinion

Astounding assertions on organics Your columnist David Anderson has fallen hook, line and sinker for the marketing propaganda of the pharmaceutical industry. In a breathtaking display of naivety, Anderson relies on promotional material from Elanco, the animal health division of global drug researcher and manufacturer Eli Lilly and Company, to attack organic agriculture as “not all that environmentally friendly and/or economically sensible....” To support his own view on organics he relies on none other than Du Pont, one of the largest agrichemical suppliers in the world, to reach the conclusion that organic agriculture cannot feed the world. Did he really think international pharmaceutical companies would commit commercial suicide by supporting a system of agriculture that

does not require their products? Sandwiched between these two examples of gullibility Anderson quotes completely unsubstantiated comment from a global trending company founded by an econ-

ing world. Nowhere does Anderson actually provide any research evidence to back up his claims. It is a myth widely propagated by those opposed to organic agriculture that organics is

organic sector would love to have even a tiny percentage of the scientific research funding that is devoted to conventional agriculture. The science that is available contradicts Anderson’s claims about

If all Canada’s corn, wheat, soy and canola production was converted to organic methods, a 4.8 million tonne reduction of greenhouse gas emissions would be achieved. omist and an accountant, to make a number of quite astounding assertions: • Organics is antitechnology. • Organics increases the use of water and feed resources and can lead to higher greenhouse gas emissions. • Organic production imposes higher food costs felt mainly in the develop-

unscientific and /or anti technology. Soil biology, pasture management, genetics/ breeding, biological controls, soil testing and fertility, animal health, seed development and selection, weather patterns are of intense interest and importance to organic farmers. Chemists are not so widely in demand. The

water usage and greenhouse gas emissions. The Argos project (Agriculture Research Group on Sustainability) established in 2003 as a joint venture between the Agribusiness Group and Otago and Lincoln Universities is an ongoing comparative study of conventional and organic farming systems in New Zealand.

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Progress results published last year show the soil on organic farms has higher water-holding capacity than conventional farms and therefore less demand for additional water. The soil on organic farms also has increased biological activity and reduced need for fertilisers, greater sequestration of carbon and less nitrate leaching to waterways. International research is in line with the New Zealand findings. In particular on greenhouse gasses, research at Dalhousie University’s School for Resource and Environmental Studies, to take just one of many examples, (reported in a release from the school on 21 October 2008) found if all Canada’s corn, wheat, soy and canola production was converted to organic methods, a 4.8 million tonne reduction of greenhouse gas emissions would be achieved. One thing Anderson did get right is that the UN has projected a world population of 9 billion by

Dereck Broadmore

2050. What he did not say, however, is that research by the UN Environment Programme publicly presented on 22 October 2008, found that organic farming offers Africa, and other similar developing nations, the best chance of breaking the cycle of poverty and malnutrition. That report echoed similar findings in an earlier UN report from the International Conference on Organic Agriculture and Food Security (Rome 3-5 May 2007). The reason organic agriculture has the best chance of feeding the developing world (where the population growth will largely occur) is because it is a closed system readily available to those already engaged in food production. It does not require the use of

expensive externally procured inputs to achieve sharp and dramatic increases in yields. In short it is the UN’s view that organic agriculture will provide more food at lower cost in developing countries. It seems implicit in what Anderson has written that he accepts the need for greater sustainability in food production while at the same time increasing global yields. That will not happen if commentators have closed minds to alternative systems of food production. If we are going to achieve these objectives it will be by working collaboratively towards a convergence of the best of both systems. • Dereck Broadmore is chairman of Organics Aotearoa.

Townie gone rural enjoys the read AS AN ex ‘townie’ I enjoy my new lifestyle here on the south Wairarapa coast (Tora) and despite the snow today being at sea level I would not go back to the city for anything. I get the Rural News, enjoy the reading, and have learned a lot. I commend you for an enlightening publication. But the August 2 issue contained an article (p 31) with a strange opening. Confusion: was it about spraying

replaced by granular spreading, or vice versa? The photos suggest it was about spraying and not granular spreading. Ed Holter Wairarapa Editor replies: Ed is correct. Gremlins crept into the editing process of the first paragraph of that article which, as subsequent paragraphs made clear, was about switching from solid to liquid fertiliser.

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opinion 31

Good times not one-off, says Alliance THE RECENT Alliance farmer meeting at Milton was almost a rerun of the 2010 event, with one big difference: the message of hope relayed last year now has runs on the board. That prophecy of greatly improved returns has been exceeded, to the point where some doubting souls are certain it has to be a one-off. But this year’s Milton meeting, and other Alliance roadshows, assured suppliers the good times are here. Even with the high exchange rate they are likely to be around for some time. In his easily understood style, Alliance chief executive Grant Cuff said 2010/2011 has been an excellent season with the average price for lamb about $110 a head compared with $70-$80 the previous year. This coming season there may be a slight easing in prices as customers adjust to increasing values. The great unknown is what would happen if USA, China or Europe fell over. And to top off the good news, byproducts are also selling for exceptional prices. Although the storm during last season’s lambing wiped out about 1.6 million lambs, there have still been enough numbers to maintain reasonable throughput. There are predictions of a modest increase in lamb numbers this coming season, which means the present processing capacity will be necessary to handle the peak kill. Cuff said the exceptional prices came with

increasingly strict requirements for animal welfare and food safety. When paying top prices customers expect something special from the meat they are eating. This went beyond traceability. New-age customers want some sort of assurance the meat is not from an animal that has been pumped full of chemicals. They want an assurance the animal has been cared for throughout its life, and that its death was painless. There is nothing radically new about these expectations, but with huge increases in prices come more strident assurance demands. There is concern ships are taking their time making export deliveries. The shipping companies say lower vessel speeds save fuel – an environmentally friendly action. But research is being done to ensure shelf life is not compromised. Cuff said the recently released Red Meat Strategy (160 pages) has plenty of room for differing interpretations. Many of the recommendations Alliance already has in place or is preparing to do so. There are suggestions from within the marketing sector that Beef and Lamb NZ should concentrate their efforts behind the farm gate and leave exporting to the companies. Cuff said in an industry that appears to reject embracing the amalgamation ideal there is a small company that shows such a concept can work. The Lamb Company has been operating in the USA for

eye on the issues john stirling

many years and its success depends on the cooperation of all those involved. The players include three

of the largest New Zealand meat companies. The meeting was one of the more contented I’ve attended. Except for those farmers caught in the September storm it has been a great year. Even farmers with horrendous losses sold lambs at heavier weights and the extra prices will have helped bal-

ance budgets. The meeting was lead by the familiar double act of chairman Owen Poole and Grant Cuff. They’ve worked together for some time and have a good synergy. Poole, who was, of course, Alliance chief executive for many years, knows how to handle

grumpy farmers, adding to the fun of the occasion. Moving from chief executive to chairman has given him elder-statesman status and a vital role in any meat industry changes. Young Grant took over the chief executive position six years ago, somewhat in the shadow of the

chairman, but at this year’s meeting Poole stayed in the background as his protégé took centre stage. Of course it was a great time to run a farmers’ gathering; the meeting went like clockwork and the questions were soft. Hope I get an invite to the Silver Fern farmer meetings.

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Rural News // august 23, 2011

32 management

Managing pasture for persistance peter burke

Pasture management needs to be tuned to what you sow, and vice versa, says Wairarapa seedsman, Paul Oliver.

YOU REAP what you sow, says the proverb. And it’s usually true. In pasture many farmers do not get as much ‘reap’ as they expect from reseeding.

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Specialist seed merchant Paul Oliver, of H&T Agrinomics, says a key determinant of a pasture’s persistence is its management. He told a recent Beef + Lamb New Zealand field

day near Marton that if farmers are managing pasture in a way that doesn’t suit the plant, then the new sowing will end up effectively lost and ‘managed out’ of the paddock. Other species that suit that environment will increase over time. Farmers must explain to seed merchants their expectations of the new pasture and the way that they plan to manage it,

this coincides with greater intensification of agriculture. “Stocking rates are much higher, so are people’s expectations of animal performance. At the same time, expectations of new grasses have gone up considerably. Farmers are looking at having higher levels of production, yield and quality, and also expect similar levels of persis-

“Lack of fertility, poor drainage, sometimes shallow soils on hills, pugging and other things including pests such as grass grub all affect pastures.” Oliver says. And seed merchants must make it clear to farmers what conditions a particular cultivar will need to perform to its maximum. Good independent advice is essential. “A huge amount of marketing material is given these days with pastures and that material isn’t always particularly clear. It’s by and large designed to sell and push the product. So it can be difficult for farmers to differentiate between what is going to give an appropriate level of persistence and what’s going to give them the level of animal performance they’re looking for in their systems.” Deciding which cultivar to buy has become more difficult. “Twenty years ago there were about three types of perennial ryegrass and three types of Italian ryegrass. “Now you have a spectrum, from a palatable annual ryegrass that lasts six months to high producing hybrids. We’ve gone from a choice of six varieties to at least 80, all bred with different uses in mind.” A huge range of cultivars has hit the market, all needing different management and required to do different things. And

tence. They don’t always go hand in hand.” Various environmental factors detract from good pasture covers. “Lack of fertility, poor drainage, sometimes shallow soils on hills, pugging and other things including pests such as grass grub all affect pastures.” Field day participants queried Oliver on the best system of resowing a paddock. “The benefit of direct drilling is faster turnaround between crops,” he replied. “It’s got a number of environmental benefits. Cultivation degrades soil structure over time and direct drilling can also be a bit cheaper. The advantage of cultivation is that it’s less precise, meaning if you make a mess of one operation you can make it up easily.” The key message to farmers on achieving greater pasture persistence is: have a good establishment plan, select the right cultivar and manage that grass to its specification. On the issue of set stocking versus rotational grazing, Oliver says some pastures perform well under set stocking, others will collapse completely.

LATEST STORIES EVERY DAY Get upto date news at www.ruralnews.co.nz

Rural News // august 23, 2011

management 33

Dairy converts nail it with nil empties vivienne haldane

CONVERTING FROM beef and sheep to dairy four years ago was a smart move for Hawkes Bay farmers, Karen and Donald Fraser. They are enjoying the double bonus of high milksolids payouts coupled with an increase in milk production last year by 100,000 kg. That was helped by a nil empty rate in their incoming heifers, 218 of them, reared in 2008 with the help of probiotic Queen of Calves. “It doesn’t get any better than that. The national average is 40%,” says Donald. They attribute their success to a variety of management factors with attention to detail throughout being crucial, they say. Karen keeps a close eye on the calves from the start. “The first 10 weeks of life is critical and will determine how good they are when they join the herd.” Calves are fed X-factor for 12 days then go on to Queen of Calves, a probiotic calf feeding supplement to enhance the nutritional value of milk. The Frasers say the calves start eating substantially early on, their coats shine and they look healthy on both products. Fibre Fresh is used instead of meal. “Fibre Fresh is partly fermented so half the work is done for the calf. An added bonus is the birds don’t like it. I also use straw to give them the scratch factor.” A crop of home grown barley is used to finish calves. Frasers used Queen of Calves in their first year dairy farming, trialling it on 300 calves which went through to produce 340kgs/head on average in their first lactation.

“That’s an average 50-60kg above average and, at $8/kg, that return is worth having.” Meanwhile forecast lower • Eight employees, including two payouts in their second year assistant managers. saw them drop Queen of • 750ha, 1500 cows, year round Calves. They later saw this milking. as false economy and rein• 6m kgMS in 2010. stated it. • Maize, barley and other feed “We pride ourselves in crops grown. hardly ever having a sick • Grain fed in shed all year. calf and I’d put that down • Running Friesian, Kiwi Cross and to making sure they get the Jersey: mid range cows more colostrum and use of probieconomical, easier on pasture. otics.” • Dairy effluent seen as soil Massey University nutrient. recently reported research • Calving shed floor of deep pea(Rural News, Aug 2) which size metal: waste drains away; no found Queen of Calves smell. increased daily growth rates by 10%, reduced weaning time by about 8 days and produced much calf. Donald says for the farm to run well, all “the little things” need to be bigger calves at 12 weeks of age. Dairy farm survey statistics show done well too. It’s a philosophy that’s Queen of Calves can produce an extra been reflected in milk quality. “We were grade free last year. Out 49kg milksolids per heifer in the first lactation and $367 extra revenue per to page 35

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Rural News // august 23, 2011

management 35

Aiming to make staff training stick sue edm o nds

CLASSROOM LESSONS for farm employees must be quickly followed by supervised practice, or 80% of what was learnt will be lost within ten days, says AgITO. In light of the Government’s new approach to industry training, which bases funding on completion rate rather than bums on seats, AgITO is taking a leaf out of the evaluation methods of

Robert Brinkerhoff, a US professor of teaching methods. Brinkerhoff ’s system emphasises supervised preparation for new learning, and supervisory support and practice soon after any course experience. Much of the training for farm workers is at NCEA Levels 2 and 3, and is about practical tasks. Learning this in a classroom can be largely wasted if they don’t get early opportunity to do the required tasks

under supervision on-farm, says AgITO director Don Seath. Consequently AgITO is starting to put some of its efforts into training the employers, as well as employees. “If the farmers aren’t trained to be trainers, they won’t take the right steps to make sure their trainee workers can do the tasks correctly,” explains Seath. However, Government funding for industry training is tagged and currently requires the trainee to be employed by

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someone. That means farmers, who are effectively self-employed, do not qualify, so alternative ways of offering training, including through ITO offshoot business ASL, must be found. It means farmers have to pay for such courses, which may not be popular, but Seath says ITO’s research shows a return of at least $4 for every dollar spent, and some think it could be as high as $13. AgITO’s efforts to find better ways

follow $3 million of funding cuts from Government. The cuts were despite audits showing it to be “squeaky clean, unlike some ITOs recently found to be claiming funding for dead and absent trainees,” notes Seath. In an industry which needs about 4000 new workers every year, useful training and proper evaluation of results is the only way to keep productivity up to scratch, he adds.

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Converts nail it from page 33

of 300 dairy farms from Wairoa to Woodville, there were only 20 grade free.” Having decided to convert to dairy, a lot of time and money were invested in the new venture. Sheds were built over the course of a year and they chose staff carefully. “The staff we attract are going places and take pride in their work,” says Karen. “They are nagging us to do more courses to better themselves. We instil in them the importance of detail. We want them to notice things: animal health comes first. “But no farm is perfect,” Donald says. “And when you get problems it’s best to deal with something straight away, rather than let it get worse.” The Frasers say the low empty rates in their cows are mostly down to growing big, strong calves. “Everything has to work well,” says Donald, “You have to get all the little bits right. You get out what you put in. It’s not just about buying some cows and all of a sudden you make a fortune. There’s a lot more to it than that. “Because we winter milk, it doesn’t matter to us if cows get pregnant a bit later.”

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36 management

Plenty of upside in

Merinos on a 50,000ha estancia, Argentina.

SOUTH AMERICAN farming is on the move, especially in Chile and Brazil, says Farm to Farm Tours managing director Ross Macmillan. He and 25 farmers in May spent three weeks in Chile, Argentina and Brazil. “Although we only saw a small portion of this vast continent, changes were

noticeable since my last visit [six years ago],” says Macmillan. “The cities seemed cleaner and safer, and there seems a lot of upside potential in farming.” Vast areas of land capable of increased production remain reasonably priced with labour comparatively cheap and

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strong global demand for product. Chile, with its mix of latitudes, elevations, soil types and micro climates can produce just about every imaginable temperate and sub tropical crop. “We started in Santiago. In some respects the region resembles a California of the south. Vineyards, citrus, avocados and vegetables abound in this warm, dry climate.... “A few days later, we flew south to Puerto Montt and the Osorno region where we visited a couple of excellent dairy farms. The climate and soils are similar to New Zealand.” There are many New Zealanders involved in dairy developments in Osorno where suitable land’s now sells for about $US10,000/ha. “Our group visited Chilterra, a dairy development company owned by a Chilean family, with technical and financial support from Kiwis, including Waikato farm consultant Mike McBeath. “They carry about 3000 cows on 4500ha they have secured so far, most of it still being developed. “The infrastructure, pastures, stock and production levels were much admired by our group of Kiwis and the quality of the farm employee housing and dairy shed facilities were as good as anywhere in New Zealand. “Mike emphasized it is a Chilean enterprise, assisted by Kiwis, rather than the other way around. In his view, speaking Spanish, understand-

ing and being empathetic to the Chilean culture is a prerequisite for successful joint venture dairy developments. “He also says there are millions of hectares of land available in the region which could be developed into NZ-style, high producing, pasture based dairy farms if such developments are handled correctly.” The Farm to Farm Tours group also visited a local Chilean dairy farming family with a traditional 125ha farm running about 220 Overo Colorado cows (red Holstein type) on pasture with minimal supplementation. “These farms were settled by German families and all have lake access of about 300m width, but stretch back several km inland. The farm reminded me of land on the South Island West Coast. The farmer even had swampy land being cleared of native trees, drained, fertilised and developed into dairy pasture. “They were doing a good job and interested to observe the efforts of the Kiwi dairy developers in the region.” Then, 200km through the Andes in Argentina – and after a little ‘r&r’ at Puyehue, prior to the nearby volcano blowing its top – to a 50,000ha, 30,000 Merino estancia. There wool yields were 5kg/head/year or more, and lambing close to 100%. “We have since learnt the Puyehue volcano has left a few centimetres of

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management 37

South American agriculture “Nevertheless, one farmer we visited with strong New Zealand connections is doing his best to adopt our pasture grazing methods, NZ genetics and irrigation to produce milk from his 600 dairy cows. “I’ve visited this estancia several times and noticed that since my last visit, progress is being made and with the improved milk prices he was pretty chipper.”

“About 8000 head of cattle were sold [the day the tour visited] and the same happens day after day to meet insatiable demand for quality beef by the locals. The market sells about 17% of Argentina’s 60 million cattle.” right in the city centre. “About 8000 head of cattle were sold [the day the tour visited] and the same happens day after day to meet insatiable demand for quality beef by the locals. The market sells about 17% of Argentina’s 60 million cattle.” Buyers ride around the pens and alleyways on well-groomed horses. “Horses and horsemanship are part of the Argentinean psyche.” From Buenos Aires it was out to the Argentinean pampas, with its deep, black soils formed over centuries under grass on the vast flood plains of the Parana river system. Massive areas of maize, sorghum, soy, lucerne and wheat are grown, with GM cultivars and no-till establishment common place. Some low lying land with drainage problems is confined mainly to beef cattle grazing. “We visited crop, beef, dairy and horse breeding enterprises.... One of the most memorable experiences was to see a herd of 150 Arab mares and their foals rounded up by young gauchos and galloping past in a blur of colour, flowing manes and tails and drumming hoof beats.” Grazing dairy cows on the hotter, drier environs of the pampas is not as straightforward as dairy farming in southern Chile.

Into Brazil and the tour took in a Dorper sheep and Angus stud, plus a 3200cow dairy farm where the milk is processed into branded products including ice cream, yoghurts and flavoured milk on farm. “Up to 110 employees work on this farm, including the added value dairy business.... The cows were confined in barns and fed a diet of maize silage, maize grain and pulp from the citrus grown on the farm, cotton seed husks and other brought in feeds. They were milked three times a day and produced an average 32 L/cow/ day.” The farm also grows 600ha of oranges, 540ha of maize, has 500ha of cattle grazing and a 400 ha conservation block. Impressive as that operation was, Macmillan says a property owned by a man who sold a sugar mill for millions of dollars, and recycled the proceeds into breeding sought after Manga Larga horses and Nelore cattle, took the biscuit. “These cattle are of the Bos Indicus tropical type sought after in Brazil and attracting big money. They had a cow and calf on display expected to be sold for about a million Brazilian Real ($NZ770,000).” Their horses sell for up to 200,000 Real ($NZ$155,000).

Macmillan on Brazil WITH GLOBAL food demand soaring, much of it will be met by the powerhouse farming economy of Brazil, Macmillan says. “The favourable climate, rich soils and vast land resource currently supports nearly 190 million beef cattle, and a similar number of people, and vast areas of sugar cane, cotton, soya beans, coffee, citrus and large dairy enterprises.” The sugar mills can quickly switch from producing sugar to producing ethanol depending upon the relative price of each. “Apparently sugar cane is one of the few biological and economically efficient ways of harnessing solar energy for bio-fuel production.” Many Brazilian cars run on ethanol, or a mix of ethanol and petrol, with “flexi” technology allowing more modern models to adjust the ratio of fuels according to relative pricing. “Some farmers have thousands of hectares of sugar cane and it is currently returning about $US8000/ha to supply the mill – big money in anyone’s currency.” Macmillan notes the air in Brazil’s big cities of Sao Paulo and Rio de Janerio seems

cleaner than when he last visited, something he puts down to ethanol use as a fuel. “Brazil is much greener than many people think: 20% of farmed land has to stay in its natural vegetation for conservation; most sugar cane residue is returned to the

paddock rather than burnt; and there are limits on the development of rain forest for farming, although apparently this is hard to police because of its vastness and continuing exploitation by Asian based forestry companies.”

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ash over the estancia and they are concerned about the damage to the wool and eyes of the sheep.” A two-hour flight north of Bariloche is Buenos Aires. “We were lucky we were there before the ash closed the airport,” notes Macmillan. “It’s so huge, bustling, stylish and European in a funny South American way.” It’s also home to the vast Lineas cattle market,

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Rural News // august 23, 2011

38 animal health

Post mortems provide profit pointers p eter burke

CONSIDER DOING some basic post mortems on lambs that don’t make it this spring because the secrets they hold could help you minimise future losses, says Ginny Dodunski, of Totally Vets. At a recent BLNZ field day in central Hawkes Bay she demonstrated how to wield the knife. There’s real value in this for farmers, enabling them often to quickly diagnose problems that occur

frequently during lambing. For example, underfeeding ewes – especially those with twins – in the six weeks before lambing increases the number of lambs that die soon after birth because they are slower to get up. “If they are up in 10 minutes and following mum they are much more likely to make it than if they take half an hour,” Dodunski told Rural News. Lambs born alive but never suckling will have no milk in their guts, and

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the fat reserves around the kidneys will be gone. “If they’ve been well nourished but died of something else the kidneys will have white or brown fat around them.” Lambs that never drew breath will have solid lungs the colour of liver. “If you find that, that’s where you stop [the post-mortem].” Swelling of the head and neck indicates a difficult birth, perhaps because the lamb had a leg back, was too big, or had too big a head – “some physical impediment to being born.” To do a quick post mortem, spread the lambs legs wide and open up the belly, cutting on up straight through the ribs so that it’s laid out. “We

Ginny Dodunski, Totally Vets, performs a post-mortem at a recent BLNZ field day.

call it the 30-second post mortem.” Though it’s a DIY operation, Dodunski recommends “running the results past your vet anyway. “It’s good to have that dialogue.” Where further investigation is required, take at least six representative carcases to the vet for a

more technical examination, she suggests. “The more the merrier but a minimum of six: the more you do the better the picture you get. Ideally we’d like to see 10-12.” For those looking for a step-by-step guide to postmortems, there’s a good one in the appendices of the booklet 200 by 2000: a guide to improved lambing percentage, published 1997 by Meat New Zealand and the Wool Board.

More detailed guide A MORE detailed post-mortem protocol, developed by AgResearch’s Juliet Everett-Hincks and S.J. Duncan with Sustainable Farming Fund support, is published in volume 2 of The Open Science Journal. A PDF of the paper, including colour photos of lungs, birth bruises (oedema),

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Rural News // august 23, 2011

animal health 39

RFID to help animal health? alan harman

ELECTRONIC EAR tags are being tested on a UK university farm as a way to monitor whether a cow might be unwell. The system at Newcastle University tracks the feeding behaviour of each animal. PhD student and project leader Ollie Szyszka says the aim is to help farmers spot any illness in the herd much earlier and treat animals more effectively. “Just as we know when we are sickening for something because we perhaps lose our appetite or feel more lethargic, animals also demonstrate subtle changes in behaviour when unwell,” Szyszka says. “The earlier you can spot and start treating an infection or disease the better chance there is of full recovery. You also reduce the risk of the infection spreading if you can identify and isolate a sick animal, but for a farmer with a herd of maybe 500 cattle it is easy to miss any early signs of disease.” The project is part of the university’s plan to improve animal welfare on farms and research ways in which agriculture can become more sustainable. The tracking system short-range antennae is mounted to feeding troughs to read the tags. Animals have also been fitted with pedometers to measure activity and time spent lying down. Results have shown cattle suffering from underlying health challenges or infection do show significant changes in their behaviour. Agriculture professor Ilias Kyriazakis says modern farming systems have minimised the contact between the animal and its keeper ways need to be found to re-address the balance. “What we are trying to do here at Newcastle is find ways to detect early infection or deterioration of an individual – regardless of the size of the herd – so the farmer can intervene at an early stage. “In the light of recent outbreaks of diseases such as foot and mouth and TB, finding ways of detecting changes in behaviour before there are any obvious signs of disease is becoming increasingly more important.”

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Rural News // august 23, 2011

40 animal health

Dog repays owners’ investment THREE AND a half years ago I sold a that special touch required for stunning heading pup to some friends, three sheep. He turned two years telling them he was going to be a old during his first season trialling, and although cracker; he had to be, he only ran in a few he was out of my lovely events John was Chloe. John and Sharon impressed with him. called him Jack. Later that year, Tautane Station, in in November 2010, Hawkes Bay, will test any Jack came to grief dog, and Jack’s future trying to stop a waywas to be a hard workhead ‘n hunt ward calf. The local ing station dog; it would anna holland vets took one look be a bonus if he had the potential to trial as John is a keen trial- at the x-ray of the hind and recommended an immediate trip to list and judge. As it turned out, Jack was born to Massey. After another examination do both. Not only was he proving to be an exceptional station dog but he had and more x-rays the Linton’s were given an option: $2800 for Jack’s surgery with a 50/50 chance of success, or euthanasia. The heading dog had proven his worth and the operation went ahead. Matawai 18 September Even though a lot of operContact Adriana 06-862 1553 ations go well, the after-care Wairoa 20 September and the dog’s attitude often Contact Kirby 06-837 5627 determine success or failure; John and Sharon were prepared Takapau 22 September to do all that was necessary to Contact Vaughan 06-374 7611 aid Jack’s healing. This included

teaching people dog training days

Anna Holland, Jack (the dog), and John and Sharon Linton at this year’s nationals.

arduous weekly trips to have dressings changed and keeping him confined to bed rest. They are adamant Jack’s calm nature had a huge part in the road to recovery. The original $2800 slowly escalated. Eventually there was no change from $6000. Sharon wrote to me “the other positive is that none of our chil-

dren ever needed braces so we had a bit of spare cash”. On February 19 Jack had his final visit to Massey. A screw was removed and he was given the all clear. March 29 I learnt Jack had qualified for the New Zealand Dog Trial Championships with 10 qualifying points – a miracle coming only four months

after the crippling accident. Tears streamed down my cheeks as I read Sharon’s email relaying the news. This year’s venue for the ‘nationals’ was Masterton. I had to be there to support Jack, after all, I am his biggest fan. Not only had I bred this talented dog, but his accident, and the faith of his owners in him to recover, is a heart-warming and tear-jerking story. I must admit to a lump in my throat when I patted him again, and the ‘good luck’ at the ‘nationals’ was a tad croaked along with misty eyes. As always the competition was tough. Jack did his best.Though he wasn’t in the prize money he had already beaten all odds. Jack’s story is of a dog’s courage, and faith in his people; it is a story of the Linton’s respect and admiration for a hard working station dog; it is a story of hope; but most of all it is a story of prayers being answered and a dream coming true. • Anna Holland is teaching people dog training. For more information www. annaholland.co.nz or Ph 027 28 44 639 or annaholland@xtra.co.nz

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Rural News // august 23, 2011

animal welfare 41

Australians all for new welfare strategy

vet leader on tb gets qso ANIMAL HEALTH Board veterinarian Paul Livingstone was formally awarded the Queen’s Service Order (QSO) by Governor-General Sir Anand Satyanand during a ceremony at Government House in Wellington earlier this month. “I was overwhelmed and flattered by the number of colleagues – both from New Zealand and abroad – who nominated me for this honour,” said Dr Livingstone. The QSO is for his contribution to veterinary science, notably nearly four decades working to rid New Zealand of Tb. His research-led livestock and wildlife Tb control policies, plans and operations have been pivotal in reducing infected herds from more than 1700 in the mid-1990s to fewer than 100 today. Livingstone had advised government officials and farmers in the US, Wales, England, Ireland and Chile on bovine TB management. He’s currently AHB’s TB eradication and research manager.

AT LEAST 140 people from 76 organisations have agreed to a blueprint for sustainable improvements in animal welfare in Australia over the next three years. This came early this month at a three-day workshop in Sydney. Attending were primary producers, animal welfare groups, industry leaders, representatives of Commonwealth, state and territory governments, and delegates from Indonesia, Malaysia and The Philippines. The workshop saw the launch of Phase II of the Australian Animal Welfare Strategy (AAWS) and the associated National Implementation Plan. These will guide improvements in welfare of animals and help Australian and overseas communities appreciate animal welfare arrangements in Australia. It shows ways to invest in welfare and to report on progress. Phase I of AAWS began in 2005 with standards for transporting livestock on land, handling non-production animals, and assessing humaneness of pest controls. AAWS advisory committee acting chair Keith Adams says Phase II of the strategy has four goals: Understanding and meeting welfare needs of animals; Providing national systems for consistent animal welfare; Helping people make ethical decisions on animal welfare; Partnering overseas to improve animal welfare. “Six working groups – companion, production, display, aquatic, research and wild animals – each plan to address these objectives by new animal welfare projects.” Stakeholders agreed to raising awareness and delivering the AAWS, within their sector and through the broader community, and committing resources to meeting the objectives.

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Rural News // august 23, 2011

42 animal health

Vaccine technology breakthrough ALAN HARMAN

SCIENTISTS AT London’s School of Hygiene and Tropical Medicine have made a breakthrough which could help combat sheep, cattle and goat disease bluetongue. “We’ve developed the tools and provided the instruction manual for developing new, more effective bluetongue vaccines,” researcher Polly Roy says. “This will not only be useful for combating bluetongue, but will provide insights into fundamental virus assembly useful

for producing vaccines for other viruses.” Bluetongue outbreaks have hit North Africa, Australia, the US, Middle East, and Asia. In recent years it has spread north across Europe and in 2007 reached the UK. It is transmitted by midges and can cause 70% mortality in sheep. “Bluetongue is an important virus to study because it poses such a threat to livestock farming, but it presents some considerable scientific challenges,” Roy says. “By virus standards bluetongue is quite archi-

tecturally complex and it has a relatively difficult genome to work with, so assembling it in a test tube was a significant challenge.” Current bluetongue vaccines are produced by chemical treatment of virus to inactivate it. While they’re effective at preventing the disease, it is difficult to tell the difference between vaccinated animals and those that have recovered from an infection, making controlling outbreaks much more difficult. Roy’s approach could allow vaccines tagged with

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Rural News // august 23, 2011

44 animal health

Rumen function focus of German symposium LEARNING MORE about rumen function and how to improve it is the key to boosting production in dairy herds and generating wealth for New Zealand farmers, says Altum. Its animal nutrition manager, Jackie Aveling, recently returned from a conference in Germany hosted by Caltech Crystalyx and German agricultural co-operative Agravis. “The theme of the conference was ‘Feeding the rumen in a changing world’ and the focus was about getting the right balance in animal nutrition to boost production and reduce

farm input costs,” says Aveling. “Much of the ground covered was linked to the need to understand more about the rumen and how that knowledge can be turned into practical onfarm advice.” According to keynote speaker professor Maciej Kowalski, University of Krakow, Poland, forage is still the major component of dairy diets globally. That’s despite the demand for ‘fast’ nutrients to meet yield demands. The importance of forage quality in reducing diet costs and maximis-

ing productivity cannot be over-emphasised, he says. “Ultimately the effectiveness of forages depends on how well they are fermented in the rumen. Only a healthy rumen can exploit the potential in forages.” Researchers highlighted practical steps which farmers could take now to improve rumen performance, including adequate protein in the diet, especially where lower quality forages were fed. Kansas State University professor Jim Drouillard commented on Crystalyx and hay diets, where

Small amounts of the right supplement can make forage much more productive, says Altum’s Jackie Aveling (centre), seen here with AgResearch project manager Andrea Rogers (right) and Altum colleague Stuart Lumley.

the extra nitrogen in the blocks led to a significant increase in the rate of fibre digestion and up to a 25% increase in feed intakes. “This is of particular interest as poorer quality forages are often fed to growing heifers and dry cows,” he says. Aveling says when we think of livestock farming

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performance and the more we learn about it the better we can improve production. “As Professor Drouillard said during the conference, though the rumen contains billions of microorganisms we currently only know about 5% of them, which means there’s a lot more we can learn.” While many field trials with Crystalyx blocks have been run in Europe and

at the benefits of Crystalyx Forage Plus dehydrated molasses blocks. The AgResearch study showed replacement heifer conception rates improved to 100% while the control herd achieved 95%. Other trials are underway here and elsewhere investigating how improved rumen function could reduce methane emissions from stock, adds Aveling.

can extract more from the diet and reduce non-productive animals it’s a winwin situation.” Aveling was one of 220 delegates from 23 countries who attended the conference. Altum, formerly known as Summit-Quinpho, markets Crystalyx exclusively in New Zealand as part of its soil-to-plant-to-animal nutrient management strategy.

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Rural News // august 23, 2011

animal health 45

Give all calves colostrum GIVE COLOSTRUM to calves picked up in the paddock as a matter of routine, says a leading calf rearing researcher. Paul Muir, of On-Farm Research, told a recent Beef + Lamb monitor farm day that at least 25% of calves picked up on dairy farms haven’t had colostrum. So farmers should routinely give all calves a mix of dayone colostrum from a number of cows. “Feed that as soon as they arrive in the shed.” Time is of the essence as even newborn calves can only absorb 35% of the antibodies in that first milk and within 24 hours the absorption rate is virtually zero. “That first 24 hours really is important.” After that, colostrum is a wonderful food but for transferring immunity it’s useless. Similarly a cow’s colostrum two days after calving has far Paul Muir fewer antibodies, hence the importance of making sure a mix of day-one colostrum is administered. Muir advises using colour-coded neck bands to identify calves to watch, such as those receiving antibiotics or slow feeding. “It was a quantum leap in how we did our calf rearing.” Rose tie-up tape is suitable and can be bought for a few cents/metre from the likes of Bunnings or Mitre 10, he points out. Slow feeders should be grouped together to prevent them holding up feeding in other pens. Clean, fresh water is a must for all calf sheds, as is good ventilation. Sunlight helps with hygiene, its ultra-violet killing bugs. Weight of calf coming into the rearing shed is a good indicator of how it will perform. “Basically the gap [between small and large] gets bigger as they go through. It’s a much better indicator than coat colour for how calves will go.” As a rearer, Muir’s policy is not to accept any calf under 40kg. On A restricted milk, ad-lib meal-and-hay rearing system, such calves can be weaned when they’ve put on 20kg, he says. However, the quality of the meal is crucial. If it is dark and there’s any reluctance to start nibbling, there’s something wrong. “It should be a light colour because the major component should be grain or soy; it should not be chocolate colour.” Dark colour suggests high inclusion of palm kernel which calves don’t like, as many rearers found out to their cost in 2007 and 2008, he points out. “There was an awful lot of palm kernel turning up in calf meal.” As an ingredient PKE is fine at up to about 20%, Muir says, and he has “no problem with it as a feed for older cattle.” However, much over that 20% inclusion rate and calf intake of meal will plummet, slowing growth, rumen development and transition to grass. “If you’ve got it right, when you put the meal out the calves [on grass] will come running for it. If they are wandering around and couldn’t care less, something isn’t right.” Meal is “the bridge” that takes calves from milk to grass, promoting rumen development which in turn allows earlier weaning and cheaper rearing. “We know in our [restricted milk] system if a calf has put on 18kg it can be weaned.... A good rule of thumb is 20kg liveweight gain.”

EVER WONDERED what a life of luxury would do to a HerefordJersey cross cow? Well now you know. These two pampered girls get everything they wish for - except maybe a bull - on Rural News’ reporter Sue Edmonds’ lifestyle block near Hamilton, including apples for breakfast. “I have a friend with an orchard who gives me buckets of ‘thirds’ and rejects,” explains Sue. Sally (left) is 12 and Rosie, her maiden and only daughter, is 10. Sally has been in milk ever since Rosie arrived.

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Rural News // august 23, 2011

46 machinery & products

More than just a draft tractor sim o n p haraz y n

THE NEW Holland T8 tractor is on the ground in New Zealand, importer New Holland NZ confirms. The T8 is instantly recognisable by New Holland’s new badging, uniform right through the range: the first two digits refers to the tractor size category and the following three relate to the maximum rated engine power – for example T8.390 being an 8 series 390 hp. New Holland New Zealand operations manager Kyle Baxter is passionate about the power and productivity of the T8 series as he outlines the versatility of the long wheel base (3450mm), lightest and most manoeuvrable tractor in its class. The ‘sculptured’ frame and bonnet, and the redesigned Terraglide front

axle suspension, guarantees a 55o turning angle and a smooth ride. The machine’s standard hydraulic flow of 161 L/min can be up-rated with the maker’s MegaFlow pump to 274 L/min, making the T8 more than just a draft tractor. The cab – a drivers ‘space’ – is even wider and more spacious than in the T7, with refinements we have grown to expect from New Holland: a versatile monitor rail, spacious instruction seat and Auto Comfort seat (available in leather), sound rated at 68 dB(A). The real productivity tool in the cab is the SidewinderII armrest with all the operation controls of the tractor, plus the maker’s InteleviewIII touch screen giving the operator finger touch control of all functions, diagnostics and performance data of

the tractor and any implement plugged into the Euro standard electrical coupling. The Command Grip joystick controls forward and reverse motion, hydraulic function and speed ratios without the operator moving his/her hand. Power-wise, the Tier 4A compliant Cursor engine from Fiat Powertrain Technologies is running SCR technology that increases power and cares for the environment. This may sound contradictory but it is not. The engine embodies a 17% reduction in overall operating costs thanks to improved fuel efficiency. Also, 100% longer service intervals and cleaner burning reduce service costs and contribute to longer engine life. How is this achieved? In lay terms, there are two ways of removing the

exhaust products. One way is to recirculate the exhaust gas and re-burn it, effective but producing increased heat as a byproduct. That is fine until you demand high power from a big engine, at which point the cooling system becomes too large to be practically contained to page 48

Improved fuel efficiency gives a 17% reduction in overall operating costs on the New Holland T8.

Rural News // august 23, 2011

machinery & Products 47 Feeder on skids easy to shift

Trailed chopper leaves nothing in its wake LELY HAS added a trailed forage harvester to its range. The Lely Storm 130 P – originally a product of Mengele Agrartechnic AG – has proven reliability and long life. High trade-in values prove its quality, Lely says. A notable feature is the machine’s large flywheel, a fuel saver the maker says. The Lely Storm works efficiently, saves energy and gives a maximum output. Capacity is high but maintenance is low, making the machine ideal for contractors and large

farmers. The 1800mm pick-up leaves no grass behind thanks to five tine bars with tine spacing of 54mm. “Even wide, bulky or uneven swaths with short crop are easily managed by these properties,” Lely says. “The pick-up accurately follows the ground contours giving a smooth lifting action without breaking the flow of the swath.” Four intake rollers create maximum compression and a reliable and even in-feed of the

crop. The Profi model is equipped with an electronic metal detector on one of the intake rollers to shut down the infeed immediately a metal object is detected. The 1300 mm flywheel with 10 knives and 5 blowing paddles maximises chopping quality. Low power requirement for chopping and transporting saves fuel – thanks to the huge flywheel. Onboard hydraulics make its oil flow independent. A built-in oil pump with its own oil reser-

voir supplies the hydraulic power for raising the pick-up and reversing the drive and spout rotation. All parts of the system are fully integrated with electro-hydraulic in-cab controls. Tel. 0800 535 969 www.lely.com

NEW FROM Agbits comes the Mobile FlexiFeeder skid trough, as seen at National Fieldays. Available as a kitset package, the trough is 1m wide x 10m long (in two sections), and conveniently skids from paddock to paddock or around a paddock. The developer, Roger Dalrymple, himself a farmer, says the trough is easy to set up and portable – simply hook it onto a tractor or ATV. The two sections allow use as a dry two-feed handler, or as a water/feed trough. Feed waste reduction on his cattle finishing block was Dalrymple’s prompt to develop the FlexiFeeder, he says. Up to 30% of feed was found going nowhere. At 33% of the cost of concrete troughs it is economic. And it’s easy to move, assemble and keep clean. Low cost/metre means long troughs can

be set up for large numbers and to cater for shy feeders and less dominant stock. The FlexiFeeder comes in 20m lengths

Agbits Quick Kit. It suits cattle, sheep, deer, pigs and goats. The flexibility in length has helped farmers feed sheep from 20–100m length troughs.

which fit together. And at 1100mm wide x 400mm deep for cattle or 300mm for sheep they hold a large amount of feed. Also available is the

It is as simple as driving a four wheeler over the trough and feeding out to the stock, the maker says. Tel. 0800 4 AGBITS www.agbits.co.nz

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OT60 NEW FOR 2011!

48 Machinery & products

ATV rollbar man faces down critics to ny benny

This is truly a 60 teat feeder with our teats spaced so 60 calves can fit in with ease, wider than the OT50 it comes with an 800 litre tank and tandem axle as standard. Simple self cleaning system the OT60 LT will save you time and money feeding calves.

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NEGATIVE FEEDBACK from farmers at National Fieldays has prompted a marketing rethink by the man marketing the Quadbar ATV rollover protection device in New Zealand. Stuart Davidson says sales were brisk after the Northland Field Days in March, then he hit a brick wall at Mystery Creek. “There was so much negative stuff, I couldn’t get over it. Not just negative but in your face, you know,” Davidson says. “People were saying you shouldn’t

be doing this and that we didn’t have a clue what we were doing. “In the end we had to stand up to them and say ‘Look, sorry mate, but you’re talking a load of crap’.” In New Zealand, no ATV rollbar is supported by the Department of Labour, motorcycle distributors or Federated Farmers. The official line is riders should be properly trained and wear helmets. But Davidson says the Australiandesigned Quadbar can save lives and has support from the NSW Government, NSW Farmers Industrial and the Australian Workers

Union. And he says he now uses his own experience to market the product in New Zealand. “It’s my story. It explains how I got involved after a near accident on my farm without a rollbar.” And though sales at National Fieldays were disappointing, Davidson says he’s had encouraging feedback since, including an email sent to the Australian manufacturer of Quadbar, who joined Davidson on his Fieldays site. The email said, “Prior to seeing your bar I have been 100% against to page 50

More than draft from page 46

MS1219

on the vehicle, so this process has limitations. The alternative is to add a precise mixture of water and high grade urea into the exhaust system which acts as a catalyst to treat the NOx component of the exhaust gas, transforming it into harmless water and nitrogen before it is released into the atmosphere. This mixture is called diesel exhaust fluid or GoClear; the process is referred to as selective catalytic reduction (SCR) and is suited to larger diesel engines (over 100hp). How easy is the DEF/GoClear to source and apply? Very easy. GoClear can be sourced from a New Holland dealer, Cummins agent or truck service centre. There is a separate tank on the tractor, positioned next to the diesel tank, and the engine’s computer does the rest. The 7% increase in power is simply the byproduct of cooler cleaner air. “The 17% cost saving, after the purchase of DEF/ AdBlue, is what stays in your wallet,” says Kyle Baxter. www.newholland.co.nz

You get your post driver set up the way you want! Every fencer has their own technique, so FENCE-PRO make sure their post drivers suit your style. Some of the many options include;  Locate the Rockspike on either side of the mast, and have it hydraulically swing in and out of the working position  Quickly remove the sidemount unit and fit the post driver to the tractor  Using a foot roller instead of the feet - even with the mast shift option.

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Rural News // august 23, 2011

machinery & products 49

Built to last KUHN REPORTS its new Discover range with central-beam disc harrows has notable technical improvements. They include: Increased robustness and three coupling positions optimise the pull point height; a large dimension central beam (300 x 300mm square) ensures sturdiness, accessibility and visibility at work; a central carriage with large width (400 or 500 mm) and large diameter (870 mm) tyres provide optimum carrying capacity. Kuhn says robustness is assured by

the integral casing improving rigidity and robustness over the whole gang holder; working depth is therefore even. New front and rear housing guard attachments (easily removed) protect all round. Quality of the operator’s work improves thanks to greater side-deflector adjustment ranges, allowing adaptation at any speed and in any working conditions to avoid ridging. Tel. 0800 585 007 www.kuhn.co.nz

EUROPE’S FINEST

David Carty, Abbey sales manager, Ireland, seen at Fieldays.

Mixer handles all feed types ton y h o p kinso n

TOTAL MIXED ration feeding is gaining on the dairy industry, says Irish feed wagon maker Abbey Machinery. Its vertical mixer-feeder wagons were on the Farmgard site at National Fieldays in the care of Abbey sales manager David Carty. The company makes feed mixers from 8-33 m3 with one, two and three vertical augers. Says Carty, “The augers carry out the dual function of chopping and mixing, while lifting up the material to the top for cycling again.” Power requirement is minimised by gentle flighting of the auger and there is less floor stress when adding whole bales, placing less strain on all working parts. “They can handle all types of feed ration including hay, silage, straw and some root crops if needed along with liquids such as molasses,” says Farmgard salesman Scott Capper. He comments on the mixer’s strength: a 20mm base plate carries the load being mixed, and replaceable serrated knives on the auger quickly and thoroughly blend materials. Retractable counter blades hold bales in position to reduce chopping time. Four weighing points are connected to the mixer’s Digi-Star weighing system. At each fill the indicator clock is zeroed with a push-button and loading can begin immediately. A help facility will lead an inexperienced operator to the next step during diet programing. There are several options for discharging the ration to troughs and/or floor or pasture. The side door option enables feed to be discharged left, right or both sides simultaneously. Side discharge elevators can be fitted to feed into troughs or bunkers. The front door option has a variable speed conveyor to feed to left or right. It is standard with a chain-and-slat conveyor with PVC available as an optional extra. Tel. 03 437 9000 sales@farmgard.co.nz

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For more information contact your local dealer WHANGAREI Ag & Earth 09 438 9163 WELLSFORD Power Farming Wellsford 09 423 8558 PUKEKOHE The Tractor Centre 09 238 7179 MORRINSVILLE Maber Motors 07 889 5059 TE AWAMUTU Power Farming Te Awamutu 07 870 2411 PUTARURU Maber Motors 07 882 1310 TAURANGA Capital Tractors 07 543 0021 WHAKATANE Jacks Machinery 07 308 7299 ROTORUA Truck & Tractor Services 07 349 6528 GISBORNE Power Farming Gisborne 06 868 8908 HASTINGS Power Farming Hawke’s Bay 06 879 9998 HAWERA Power Farming Taranaki 06 278 0240

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FEILDING Power Farming Manawatu 06 323 8182 MASTERTON James Trucks & Machinery 06 370 8240 NELSON Brian Miller Truck & Tractor 03 544 5723 BLENHEIM Marlborough Tractor Services 03 572 8787 WEST COAST Power Farming Timaru 029 200 1202 CHRISTCHURCH Power Farming Canterbury 03 349 5975 ASHBURTON Power Farming Ashburton 03 307 7153 TIMARU Power Farming Timaru 03 687 4127 ALEXANDRA Peter Watt Machinery 03 448 8490 MOSGIEL Power Farming Otago 03 489 3489 GORE Power Farming Ganders 03 208 9395 INVERCARGILL Power Farming Ganders 03 215 9039

Rural News // august 23, 2011

50 machinery & products ATV rollbar man faces down critics from page 48

bars on the back of quad bikes. I’ve seen the practical application of existing systems and the problems they can create. “However, I found your low-slung-around-theedge system enlightening. Almost the blinding flash of the obvious. Your research and reasoned arguments supporting your design were compelling enough for me to write this email.” Davidson also cites a telephone call from a Balclutha man who bought his product: “I’ve just rolled my bike and I’ve rung to tell you it saved my bloody life.” Tel. 021 182 8115 www.quadbar.co.nz

PRODUCTION ORIENTATED FARMERS... Are you suffering from:

• Surface ponding of pastures? • Hay & silage being tramped into pasture and wasted?

Pugged paddocks can reduce pasture growth up to 60% DON’T PUT GOOD FERTILISER ON COMPACTED SOIL WHICH CAN’T ABSORB IT If your soil can’t support 15cm root growth and good worm population check for compaction. You could need aeration. In dollar terms, what would 20% production increase mean to your yearly turnover?

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Range builds on success of predecessors MANY FARMERS are said to be admiring Agco’s ‘workhorse’ concept embodied in its Massey Ferguson 5400 series tractors launched in March and unveiled at National Fieldays. The company says the range has strengthened Massey Ferguson’s position in the livestock and mixed farming tractor sectors. All four machines are “entirely new”, ranging in power from 82 to 107hp. “Once we released the new range, the inquiry was great,”says Massey Ferguson New Zealand manager Peter Scott. “We’ve consistently taken orders for the new models as customers become aware of how well suited they suited their requirements.” National Fieldays was the ideal launch backdrop; the 82hp MF5420 was the model chosen for display. “Having the MF5420 at Mystery Creek was a real plus,” Scott says. “We could give many customers the opportunity to get up close with the new model.” The four MF 5400 tractors use proven features from previous models, such as the Dyna-4 transmission, re-engineered to suit specific customer requirements for this size

and type of tractor. This makes for an “unbeatable combination” of manoeuvrability, stability, visibility and access, Scott says. All are powered by Perkins 4.4 L, 4-cyl. 1104D44T mechanically injected engines “renowned for reliability and economy”. Maximum power is achieved at 2000rpm, reducing fuel consumption, noise and wear. Torque is “impressive” at just 1400rpm, so consequent lower engine speeds cut fuel consumption and noise. The bonnet design is new, allowing high visibility forward and to the sides. But its shape does not compromise cooling efficiency. View is good to the loader and optional front linkage. Agco says it has invested “huge amounts in the R&D of a completely new transaxle for exclusive use” on these new MF tractors. It starts with the Dyna-4, 16F/16R transmission, with clutchless operation after starting. Left-hand power control, clutchless reverse shuttle is ideal for loader work. “Dyna-4 has gained a great reputation for reliability and efficiency,

A wide choice of speeds and low mechanical losses help underpin the “great reputation” of the MF5400’s transmission.

by combining a wide choice of speeds with low mechanical losses,” the maker says. “For the new, lower power MF 5400 series, the transmission has been made lighter and refined.” All models are standard with 540/540E/1,000rpm PTO, with engagement and speed selected electro-hydraulically with a button in the cab. Ground speed PTO and super creeper are options. The new rear axle is specific to these models.

Lift capacity is 4300kg, with a 10% lift speed increase, compared with current tractors. A dual pump, opencentre hydraulic system has flow of 42 L/min plus 57 L/min, at a pressure of 200 bar. Further, an (optional) 100 L/min twin flow feature combines the flow from both pumps. A new front axle casting is designed using experience gained on larger Massey Ferguson tractors. Operating features

include exceptional turning angle and ground clearance. It allows front linkage and loader to be fitted at the same time. The cab is a “spacious, quiet workplace [with] features found on the larger models, such as (optional) cab suspension. Standard specs includes vertical side exhaust, tinted glass with opening side and rear windows, heater, radio/CD player and air conditioning. www.masseyferguson. com.au

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MS1265

Rural News // august 23, 2011

machinery & products 51

‘Cultivate big areas faster’ IN TIME for the new season comes the Lely Tulip Multidisc Vario, a one-pass tillage machine. This can transform stubble to seed bed, using two sets of scalloped discs and a row of tines between, followed by a crumbler/packer roller. This is a machine for

farmers wanting to cultivate and rip soil at the same time, Lely says. The front discs are followed by the tines which have hydraulic stone protection. These can be hydraulically lifted if the ground only needs discing. They penetrate to 300 mm. There are larger gaps between the discs and rip-

pers which allow for soil and trash flow, giving time for mulching and mixing and better incorporation of trash and crop stubble. The discs are made from hardened steel and the bearings have ‘overdimensioned’ hubs that reduce maintenance. There are three models available in New Zealand: the 300XL at 3 m working

width, the 350XL (3.5 m) both with six ripper tines, and the 400XL at 4 m with eight tines. “I see the Multidisc Vario as an alternative to the power harrow and with a working speed between 8-14 km it is the ideal machine to cultivate large areas of ground in a short time,” says North Island

Long, hard weeks in heavy going SOUTH CANTERBURY contractor Pete Brandreth has no regrets about swapping his previous rotary tiller for the Celli Tiger 190, reports supplier Farmgard. “I only used my previous machine for about one year but wasn’t happy with the finish it produced. I don’t have time to be messing around in the paddock. I need to do a great job in the shortest-possible time.” Brandreth decided on Celli after talking to local farmers who use the brand. “I ran the Tiger 190 last spring pretty much full time for six weeks, and did other jobs until Christmas. Excellent job, and less driving because of the faster ground speed.” The Tiger 190, evolved from the K series, is one of the most successful products in the Celli range, Farmgard says. It suits cultivating heavy and sticky soil and burying crop residues. Redesign of the bottom part makes soil flow easier, because of high clearance between the blades and the bottom of the frame. This reduces risk of soil build-up in wet conditions and decreases power consumption. Rated to 190hp maximum, it suits Brandreth’s 200hp tractor because he has a pre-ripper on the front. “This machine is great option for contractors and farmers. I know guys pulling it with a 115hp tractor and getting the same finish, though the job takes a bit longer.” Brandreth has also mounted a drill on the Tiger 190 and

pulls a roller behind. “It will work the ground in one pass in pretty much all conditions – even ground pugged badly in winter. It also copes well with small stones and flies across stony ground if it’s ploughed first.” Brandreth likes the machine’s strength. “It is well-built with a strong frame and the tynes are hard

area manager for Lely New Zealand, Andrew Saes. Tel. 07 850 4050 www.lely.com

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>> >>

wearing. I’ve operated the machine for a whole season and haven’t had to change any yet.” Rotor shafts and flanges are made from hard-wearing steel; effective sealing protects rotor shaft bearings. Tel. 09 275 5555 or 03 437 9000 sales@farmgard.co.nz

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With models ranging from 70-270hp, there is a Deutz-Fahr tractor available for just about every application. And whilst the specifications may differ, every Deutz-Fahr tractor has the same pedigree, build quality and outstanding value for money proposition.

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ANOTHER REASON TO CHOOSE

RA67

TO N Y H OP K I N SO N

Rural News // august 23, 2011

52 machinery & products

‘Vigorous, girthy, pendulous...’ Daniel Dovaston (left) with Barry Smallridge of Pacific Seeds in a crop of DKC57-83.

TWO NEW hybrid maize seed offerings from Pacific Seeds are both known for their vigour, says the company’s northern territory manager. “Since their introduction, DKC57-83 and PAC 504 have both shown strong performance,” says Barry Smallridge. “As a result, they have been really well received by our growers. “DKC57-83, with a 107 CRM, is a high yielding full-season grain option also suitable for quality silage.”

“This hybrid has excellent agronomic traits, which include outstanding dry down, good test weights and good standability,” says Smallridge.It also has good husk cover and pendulous cobs, which protect the grain from the elements and pests during dry down. DKC57-83 suits grain growers in warmer climates from Northland through to Waikato, Gisborne and northern Hawkes Bay. This is an attractive hybrid for growers uncertain of whether they are going to sell silage or grain. Te Puke grower Daniel Dovaston, who grew DKC57-83 last season, has a good word for it, Smallridge says. “DKC57-83 is a hybrid you can trust”, he said. “We like the quick dry down that enables growers like us to PAC 504 grower Richard Kershaw of Martinborough. target yield without sacrificing an early harvest. “Our crop averaged 16.7 tonnes over 45 ha at 18.3% and we’ll be back for more this season.” PAC 504, sold with a $20 cash back reward this season, is favoured by Richard Kershaw, of Martinborough. “PAC 504 has grown on the people around here”. Developed for New Zealand growing conditions PAC 504 is a robust plant with stalk strength, the company says. It maintains leaf quality and staygreen with slow dry-down. Large girthy cobs are said to give PAC 504 a high cobto-stover ratio and silage quality. PAC 504 is high-yielding for silage for mid/full-season planting in lower North Island regions. Or it has flexibility for planting as a mid season, grain or silage option in the mid- and upper North Island regions. “We initially evaluated PAC 504 in a side by side trial with another hybrid a few years ago and the comparative results sold us,” says Kershaw. Tel. 027 494 7706 or 027 287 8776 www.pacificseeds.co.nz

Digs and grades A DIGGER with a dozer blade is just the shot for farm cleanups and excavations, says AB Equipment. It sells the the Sumitomo SH130 and finds it popular with contractors wanting good performance at lower operating cost. Farmers are now catching on to the Sumitomo SH130-5DZ as a good all-rounder, the company says. The SH130-5DZ is essentially the standard SH130 but with the optional extra of a dozer blade. Marton based Graeme Greer, of Central Excavators, is using a SH130-5DZ excavator mainly for hill work around Hunterville. Some 90% of the projects are on dairy farms. Specific applications include the clearing and building of tracks and dams and the repair and maintenance of slips. “The extra dozer blade function has sped up the tidying process and allowed us to push the earth around, making building dams in particular a much easier task,” says Greer. Tel. 0800 30 30 90

Rural News // august 23, 2011

machinery & products 53

Bales dense, consistent ton y h o p kinso n

BALES DENSE and consistent impressed Craig and Chris Rye, Southland, last December when they began running a Feraboli Omnia baler/wrapper bought from local distributor Webbline, Gore. Over the years they have owned several different brands of baler, and had looked at the Feraboli with a view to change. They got the new baler somewhat under pressure. “We had 40 ha cut and ready to bale [with their former machine] but we had a major breakdown and were told we could not get parts for several days.” With bad weather forecast they contacted Webbline at 10 pm on a Friday and ordered the Omnia. It was working in the paddock at 10 am next day. The Rye brothers had moved to Southland from Te Aroha, in the North Island. They sharemilk on separate contracts, Craig and wife Jamie at Tussock Creek, and Chris at Edendale, running 360 cows. Craig and Jamie have been in the south 12 years, are four years into

their present contract and have 950 cows. They began calving August 10th and try to milk through to the end of May. They plant 15ha of swedes for winter feed and this is replanted in grass as part of pasture renewal. “There is a lot more rain in the summer and no facial eczema, both problems where we came from,” Craig says. The two farms are 20 km apart. Between the two they make 2000 bales of baleage a season and with their shared interest in machinery do most of their own tractor work for cultivation, mowing and baling. “We’re only 40 minutes distant, and we communicate so there is generally no clash over machinery use,” says Craig. The Ryes’ first impressions of the Feraboli Omnia were good, says Webbline. By the Sunday afternoon they had baled 800 bales and Craig left the tractor seat only to change the plastic and net. “Webbline’s service was excellent and even though we were new to the machine it went without a hitch from the start.”

The brothers like the machine’s dense bales and the wrapper’s ability to keep up with the baler. Webbline Agriculture sales manager Glen Malcolm says the Feraboli balers are increasing in popularity because of bale consistency. The Rye brothers use a SAME 120 hp Iron to drive the baler. It “gobbles up” the combined 9m windrows, they say. Tel. 0800 932 254 www.webbline.co.nz

Craig Rye, of Tussock Creek, Southland.

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Rural News // august 23, 2011

54 motoring / rural trader

Smaller engine, same power in ‘Landie’ A NEW 2.2L diesel engine in Land Rover’s Defender will raise performance and refinement, the New Zealand distributor says. The 2012 model will be here by Christmas. The smaller capacity motor has power, torque and economy equal to the 2.4 L motor it replaces. This will be the cleanest Land Rover Defender yet, sold here in six different models priced from $61,500. The Defender’s specification was upgraded in 2007, including a new facia and six-speed manual transmission. “With the new 2.2 L diesel, the Defender for 2012 offers greater customer choice than ever,” says John Edwards, Land Rover global brand director. The 2.2 L diesel engine has a new, full acoustic cover, instead of the former splash cover. This reduces radiated engine noise. Though smaller, the new engine produces the same power as its prede-

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Rural News // august 23, 2011

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