Dairy Farming into the Future 2021 by Wairarapa Times-Age

FEATURE SUPPLEMENT 23

www.age.co.nz Thursday, June 24, 2021

DAIRY FARMING

Maori ownership brings new approach to dairying

INTO THE FUTURE 2021

A Maori-owned business with Wairarapa Moana Inc (WMI) as one of its cornerstone shareholders is leading the way in a new approach to milk production, which just may be the way of the future. In 2009, WMI and fellow Maori trust, Tuaropaki Kaitiaki Ltd, went into partnership to form the Miraka dairy company – ‘miraka’ being for the Maori word for milk. Located near Mangakino, WMI manages one of New Zealand’s largest farming operations with dairy, beef, and forestry. Tuaropaki Kaitiaki Ltd farms over 3900 hectares of land for dairy, sheep, beef and deer along with a geothermal power plant. Together the two Maori entities led in the construction and operation of a milk processing plant at Mokai, 30 kilometres northwest of Taupo. The history of WMI goes all the way back to 1896 when the original owners of Lake Wairarapa gifted the bed of Lake Wairarapa to the Crown in an exchange that should have seen the Crown gift a reciprocal amount of land somewhere within Wairarapa. That gift occurred 20 years later when in 1916 scrub and tussock land in the central North Island was ÿ nally vested in gift to Wairarapa Moana’s owners. It was a long way from home. The land was purchased in the 1890s by the Crown to accommodate a railway linking Hawke’s Bay to the central main trunk line. However, the rail line was never developed and the block had no use.

While located close to Lake Taupo, Miraka’s roots go back to Lake Wairarapa. Instead, this poor pumice country covered with tussock and scrubby tea-tree, with no road or rail access was given to Wairarapa Maori. Without legal access it remained inaccessible and untouched for a further 30 years. In 1948, when road access was ÿ nally established, the Wairarapa community sent six of its best and brightest young men up to Pouakani to settle and to begin the work of breaking in the land. It eventually became the productive farmland that WMI occupies today. WMI administers the land for over

3000 descendants of the original owners of Lake Wairarapa. Fast forward to the 2000s and the poor record of understanding and representation of Maori landowners in Fonterra’s business model, and the formative seed for the birth of Miraka began to form. Murray Hemi, Kaitiaki o te Ara Miraka/ GM Environmental Leadership at Miraka says the requirement to buy shares to supply milk to Fonterra had not worked for Maori. “Maori farming has been, and will continue to be, in dairy for hundreds

of years. Maori don’t sell their land nowadays. Having their money locked into someone else’s business for many, many years, if not forever, simply does not make any sense.” Miraka decided it could do something better, he says. Murray was born in Greytown and shifted to the new farms in Mangakino. His work for Miraka brings him close to the WMI farms, while his family in Wellington ensures he makes it back to his marae at Papawai. CONTINUED ON PAGE 24

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24 FEATURE SUPPLEMENT

Thursday, June 24, 2021 Wairarapa Times-Age

CONTINUED FROM PAGE 23

beneÿ t from our work.

Today Miraka processes more than 300,000,000 litres of milk each year into powders and Ultra High Temperature (UHT) and frozen milk concentrate products. It has markets in over 23 countries throughout the world. It is owned by six Maori Trusts or Incorporations plus a strategic partner in Vinamilk, a leading milk manufacturer and dairy products enterprise in Vietnam. Miraka is recognised as a leading New Zealand business, both as an exemplar for the new M˜ori economy, but also through its role as environmental leaders.

“We are a legacy company so the work we do today needs to be of real beneÿ t culturally, commercially, socially, and environmentally for tomorrow. We are a company founded on tikanga (balance) and kaitiakitanga (care). We were always destined to look to our past to prepare and provide for our children’s future.”

INTO THE FUTURE 2021

This has been recognised through a long record of national awards and accolades:  New Zealand Biosecurity – Supreme Award 2020  M˜ori Agribusiness of the Year 2018  Ministry for Primary Industries Good Employer Awards 2018  Te Tupu-a-Nuku Award for Business Innovation 2016  Inaugural winners of the He kai kei ringa Award for M˜ori Excellence in Export 2015. Miraka’s milk supply comes from 104 farms within an 85km radius of the factory. This results in superior quality products, but also contributes to a lower carbon footprint. Protecting the environment is of paramount importance to Miraka, says Murray. “We have a 100-year strategy. We want to ensure that future generations

Miraka uses renewable geothermal steam from the Mokai geothermal ÿ eld to run its processing operations – a Murray Hemi, Kaitiaki o te Ara world ÿ rst Miraka/GM Environmental for the dairy Leadership at Miraka. processing industry. Biological waste created during the drying process is composted at the Tuaropaki worm farm nearby. The worm castings in turn support a local native plant nursery and these plants are used for riparian waterway planting. Murray describes Miraka as a microcosm of the New Zealand dairy industry with a range of farm suppliers, from Maori and non-Maori enterprises to family farms and farming corporates. Miraka supports all its farmers to operate at world-class levels of excellence and reach environmental standards well above those required by government departments and councils. It goes so far as to pay its suppliers over and above the market farm gate price when they achieve higher and higher standards of farm practice – from onfarm environmental practices, to fair and care employment practices, and animal health and well-being.

“Our farm standards, through the Te Ara Miraka process, provide a really solid foundation – you meet Miraka standards, you know you’re at World-class levels. “It allows us to move to the next level. With our standards in place we can shift to the idea of ‘belly-based farming’.” This, says Murray, is “less about rules and standards, although those have to be met, and more about farmer knowledge, experience and innovation. “Once we have the Te Ara Miraka standards and practices in place we can support farmers to set their own personal goals and expectations, to build their own legacy. Every farmer knows his or her farm better than anyone else. They have an intuitive sense of good farming on their property and they all have a vison for what the farm could look like and the role they can play to support the environment. Why not harness that energy? “Less focus on telling farmers what they can’t do and more supporting them to do the awesome things they can do. It’s a mind shift, di˛ cult for some, but one we are ready for at Miraka.” Also noteworthy is the scale at which Miraka is operating. Most businesses attempting a similar approach tend to be small operations. But Murray says there are lots of challenges and no guarantees. “There is no map for this approach, so we are always at the edge of understanding of how to be a corporate entity that is proÿ table at the same time as staying true to our values. Miraka is future focused but past informed,” he says. “What that means is that all of our traditional values and the way we aspire to be in this world inspire our travels, and also lead us into the future.”

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FEATURE SUPPLEMENT 25

www.age.co.nz Thursday, June 24, 2021

Is your farm set up to thrive financially? It’s been a rough month for some, particularly if you were planning a trip to Australia or thinking about a new (high-emissions) utility vehicle. In the scheme of things though, it’s a pretty good time to be Dairy farming – milk prices have increased, providing a strengthening cash position for most, and farmers are in a good state of mind. With farms selling again and a changing capital structure, we can be grateful for plenty. While it’s easy to get carried away and ‘let the good times roll’, next season will be here before we know it and it’ll surely bring us all some curly ones! There’s a lot going on in the rural sector and your business is a complicated one. Having great partners working with you on your business saves time and money, particularly when they ask the questions you may not have thought of. Do you have a good governance model? Have you considered an Advisory Board? An Advisory Board usually

consists of business owners, family, and trusted advisers (farm adviser, banker, accountant, trustees, lawyer). With a focus on strategy, risk, compliance and fiscal management, this is a group of allies for you in your business. With no resolutions, and not governed by the Companies Act, you know it’s a group you can trust. And now we’ve mentioned the ‘c’ word – compliance… Government policy around farming and the environment is one area that’s sure to start – or stop – a conversation. What are the obligations that you will likely face over coming years? What will influence your ability to comply with them? While we’re talking strategy and compliance, let’s chat about benchmarking. With farm benchmarking focusing on Physical, Environmental and Financial measures, there are legal implications in all three areas which need to be considered alongside the benchmarks that you’re wanting to reach.

aligned. For example - are the consents and use contracts of your property conducive to changing requirements for indigenous biodiversity? How do the people, resource consents and planning contracts or arrangements regulate how you operate? Are they future-proof? Are you thinking that syndication or other ownership/partnership models may be an option for you to support growth as regulations change? Many people are currently reviewing their use of trusts in light of the new legislation which is quickly becoming a familiar discussion topic. Finally, is your farm set up to thrive financially? With different financial arrangements working best for different

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26 FEATURE SUPPLEMENT

Thursday, June 24, 2021 Wairarapa Times-Age

INTO THE FUTURE 2021

From India with a passion for dairy farming North India and Pahiatua are worlds apart, but two brothers have managed to bridge them, becoming the 2021 New Zealand Share Farmers of the Year. Manoj Kumar and Sumit Kamboj grew up on their family’s cropping farm in North India, two hours drive from Delhi, which also includes around 10 dairy cows. Manoj ÿ nished his agricultural studies in India and worked on the family farm for 10 months before wanting to study more. He learned that New Zealand has many good options in agriculture and came to this country as a horticulture student in 2010. “I was commuting between Auckland and Tauranga twice a week and noticed that around the orchards there were dairy farms.

Manoj Kumar, (left) MCI Associate Principal Aaron Karena, and Sumit Kamboj.

“I stopped to have a look and was

FEATURE SUPPLEMENT 27

www.age.co.nz Thursday, June 24, 2021

Manoj believes Tararua accountancy ÿ rm MCI & Associates, who they have been with for eight years, have played a big part in their success as a business and in winning the national award. MCI Associate Principal Aaron Karena meets with Manoj and Sumit quarterly to work through their business strategy to ensure everything is on track for success. “We go over the business and look at di° erent options to see how we can get from where we are now to our goals in the shortest and most proÿ table way. NZDIA National Share Farmer of the Year winners Manoj Kumar (left) and Sumit Kamboj.

excited by them - the scale of the dairy farms with up to a thousand cows for every four or ÿ ve sta° whereas in India it is around one person for every 10 cows. “I thought I would look for a job in the industry and in 2011 saw an online advertisement for a farm assistant in Pahiatua and did an interview via skype.” Manoj started working as a farm assistant but quickly became the manager after the previous one resigned, while his brother Sumit, who had come to New Zealand with Manoj’s encouragement, became the farm assistant at the beginning of 2012. Today the brothers are 50/50 sharemilkers with 760-cow on two properties in Pahiatua and one in Eketahuna, owned by Andrew and Monika Arbuthnott, Geo° Arends and Ester Romp’s 285ha. Last month Manoj and Sumit were named the 2021 New Zealand Share Farmers of the Year at the New Zealand

Dairy Industry Awards, and described as driven, professional and high-achieving siblings who benchmark excellence within the industry. Share Farmer head judge Jacqui Groves, from Westpac, says Manoj and Sumit impressed the judges with glowing reports from current and past employers and employees. “They have amazing relationships with two sets of owners, who really believe in them.” The judges were also impressed with the brothers’ on-farm presentation, which used drone footage from their family farm in northern India to explain their history and where they are from. Manoj and Sumit demonstrated strengths in leadership, health and farm safety, business and community engagement. They also won three merit awards: the Federated Farmers Leadership Award, Honda Farm Safety, Health and Biosecurity Award and the Westpac Business Performance Award.

“The lessons we learned would not have been possible without Aaron. We are lucky to have MCI. They have sped up our growth multiple times.” The brothers met on farm with Aaron and their bank’s Agri Relationship Manager Sally Terry to prepare and get their feedback. Entering the Awards has created an excellent network within the industry and valuable feedback from judges, Manoj says. “Coming from India, we didn’t know many people and so have engaged in dairy industry events to overcome our lack of a network.” The New Zealand dairy farming system is totally di° erent from back home in India and it really appeals to the brothers. “It’s very rewarding as we can see the improvements we make on-farm and there is a culture unlike any other industry.” Share Farmer judge Guy Michaels from DairyNZ said the brothers demonstrated involvement and leadership in the local community and in the dairy community.

“They have a willingness to work with others to achieve joint goals and advocate on behalf of others.” An example of this was Manoj and Sumit assisting a family in Wellington who had lost employment due to Covid-19. Manoj says the man was a family friend who had lost his job as a chef in Wellington. “I asked if he wanted to give dairy farming a go. He stayed with us for six weeks on the dairy farm, and we showed him the milking basics. Then we started looking for a job for him and found him one as a farm assistant last year.” The judges noted the brothers have a strong health and safety culture onfarm, with a long history of recording incidents and following through with changes. “Health and safety is most important to us,” says Manoj. “We want our employees to get home safely at night.” Judge Guy Michaels noted how strong the brothers are in their community involvement and leadership. They have promoted PrimaryITO courses to everyone in their community and have o° ered up one of their buildings to ensure the training takes place. The brothers enjoy living in the Tararua district. “We feel really welcomed here and like the community.” Their brother Bramod continues to manage the family farm in India. Should you want to know more about the success of Manoj and Sumit or want to see how MCI can help you with your farming success get in touch with Aaron from MCI on aaron@mcia.co.nz, or phone him on 027 301 0085.

at MCI & Associates,

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28 FEATURE SUPPLEMENT

Thursday, June 24, 2021 Wairarapa Times-Age

Going Green workshop INTO THE FUTURE

The Dollars and Sense of Going Green Workshop is being held at the Carterton Events Centre on Thursday 1 July from 2pm to 4:30pm.

 How recording environmental progress can unlock lower interest rates and potential lending opportunities

The workshop will identify opportunities on your farm to meet both national and your own environmental goals, while reducing costs and becoming more proÿ table.

 Regional trends, and solutions that have worked for other farmers in your area

DairyNZ and BNZ are partnering the workshop to help businesses thrive into the future. Find out:

2021

 How you can respond to environmental limits without taking a hit on proÿ t

Refreshments will be provided at the conclusion of the workshop, kindly sponsored by BNZ. Please RSVP to abby.scott@dairynz.co.nz by tomorrow (Friday 25 June)

 Details on how banks are supporting you to meet both your ÿ nancial and environmental goals

New plantain research a turning point for dairy A new $22 million research initiative is under way to help dairy farmers improve freshwater quality – through using plantain pastures.

Modelling by DairyNZ forecasts a potential reduction of 15,000 tonnes per year of nitrate-nitrogen leached on 4200 New Zealand dairy farms in nitrogen-sensitive catchments per year by 2035. This is a 37 per cent reduction from current levels.

The Plantain Potency and Practice programme is designed to help dairy farmers meet environmental goals, government regulations and market expectations.

Plantain use is predicted to lead to ˜ owon beneÿ ts to national and regional economies. This is due to farmers spending less on other nitrate leaching solutions, therefore having more

money to spend on goods and services. Plantain use is expected to save farmers more than $1 billion per decade. The work will focus on proving plantain’s e˛ ectiveness at reducing nitrate leaching, investigating regional e˛ ects and protecting the supply chain. The programme will use PGG Wrightson Seeds’ Ecotain environmental plantain, because it already has proven e˛ ectiveness.

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