Miraka suppliers score $3m bonus. PAGE 7 KING OF CO-OPS Chairman gets gong PAGE 21
AUGUST 28, 2018 ISSUE 407 // www.dairynews.co.nz
RAISING ANCHOR IN CHINA Fonterra’s Anchor is now the number one consumer milk brand in China. Christina Zhu, Greater China president PAGE 5
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DAIRY NEWS AUGUST 28, 2018
NEWS // 3
‘Lucky to have co-op’ SUDESH KISSUN sudeshk@ruralnews.co.nz
FARMER and former Fonterra director Mark Townshend is urging shareholders to support Fonterra and its new leadership. Townshend, who has farming interests in New Zealand, Chile, and the US, says NZ is “very lucky to have Fonterra”. “Most milk producers around the world would dream of having a
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Fonterra in their country,” he told Dairy News. “John Monaghan (new chairman) is a good bloke, as is Miles Hurrell (interim chief executive). With the headwinds Fonterra is dealing with, they need shareholder support. “One thing is for certain: if Fonterra shareholders do not support and value their company no one else will.” Townshend notes that while Fonterra does some things very well, it could do many other things better. But Fonterra’s main task is to provide its NZ supplying shareholders with a world class milk price. With a price in the $6.50 - $7.00/ kgMS range, all NZ farmers should be profitable and contented, Townshend says. “The milk price European farmers are currently receiving is about the long term average; US dairy farmers are receiving milk prices below long term average.
“Fonterra farmers, with milk prices at $6.70 last season and forecast at $7.00 for the current season, are receiving a milk price higher than long term average; Fonterra is delivering what it set out to do.” Fonterra farmers receiving a base farm gate milk price equal to, or better than other farmers around the globe is an amazing success when considering we produce our milk off a strong seasonal curve, and NZ farmers pocket the $1.00 /kg MS lower cost of production advantage. Townshend says at one of the farming companies he’s involved in, the first 20 minutes of each board meeting are spent discussing what is happening globally and in NZ in terms of geo-politics, finance and markets supply and demand. “With a well-informed Irish director connected in by phone, and the company’s US-based chief executive, we have good tentacles and conclude that both, NZ and NZ farmers are well served by Fonterra,” he says. This company has in the last 15
months bought four NZ farms; all had been supplying Open Country Dairy (OCD) but now supply Fonterra. “It is a very interesting statistic that over the last two seasons in NZ, 50% of dairy farms sold were supplying OCD, yet only 10% of [all NZ] farms supply OCD. “The conclusions to be drawn here are that those who go to OCD are perhaps under more financial pressure, or the year-round farming method encouraged by OCD burns out farmers; fighting nature has always been hard.” Townshend says without Fonterra setting a milk price, there is no way non-cooperative milk processors would be paying what they do. “They have to pay a milk price to attract milk or face stranded assets,” he says. “And they will pay no more than they need to pay. “To expect them to do so has as much logic as farmers willingly paying more for fertiliser or stockfeed than they need to.”
WEATHERING THE STORM MARK TOWNSHEND notes that New Zealand companies, including Fonterra, did well in weathering the global financial crisis ten years ago. The dairy industry was invaluable to the NZ economy through that period. The real test for NZ dairy farmers came in the 2014-15 and 2015-16 seasons when the milk price dropped well below $5/kgMS. “Farms generally were operating at a $1/kgMS deficit through this two year period.
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Mark Townshend
“Fonterra advanced significant interest free loans to supplying shareholders through that period; I am trying to recall any Fonterra farmer publicly acknowledging their appreciation of support from our co-op. “It would be reasonable to assume that it saved some farmers from economic ruin. And it probably meant less in unpaid bills to ensure rural servicing industries survived.” Townshend says Fonterra drives processing efficiency, being world class in this area.
DAIRY NEWS AUGUST 28, 2018
4 // NEWS
Fix investments or leave them SUDESH KISSUN sudeshk@ruralnews.co.nz
FORMER FONTERRA
director Mark Townshend says that despite the A+ rating Fonterra should get from its shareholders for its ingredients business, clearly some Fonterra investments are performing very poorly. But Fonterra farmers should not over react to the poorer performing parts of the business, they should just have a very strong expectation that Fonterra fixes them or exits them. Townshend says shareholders will expect senior executives’ bonuses to be much more modest in 2017-18 and reflective of company profit (earnings achieved in excess of a good milk price). He urges Fonterra to “get its nose out of farmers’ faces” in respect of palm kernel
FONTERRA CRITICS MARK TOWNSHEND says Fonterra cops its share of criticism -- some deserved and some over the top. Referring to the recent attack on Fonterra leadership by NZ First Minister Shane Jones, Townshend says the “bizarre outburst will have been fuelled from somewhere”. “And it will be worth watching who funds political parties (donations) and what they might like to see for their own self-interest as Government legislators do the DIRA review.” Townshend says the Green Party and animal rights activists will always try to undermine the big machine of Fonterra. “They will never be satisfied even as farmers make further and ongoing and necessary changes/ improvements over all forms of compliance.” Townshend says non-supplying Fonterra unit holders receiving disappointing returns on investments have “a genuine grievance”.
expeller (PKE) feeding limits, milk cooling and environmental issues, which should all be dealt
But he is disappointed at criticism from Fonterra shareholders and ex-Fonterra employees. “Disaffected Fonterra farmers – some of whom are disappointed about not reaching the station they might have aspired to in Fonterra -would have better spent their time in using the knowledge they gained by supporting their company to make improvements and changes required. “And there are former employees of Fonterra who were happy to be well paid [there] but when, because of company restructure or for other reasons, they find themselves in other NZ milk processing companies, they vent their negative Fonterra views.” Fonterra farmers need to be able to make their own assessments around how well Fonterra is doing in paying its farmers a globally competitive milk price rather than being overly influenced by outside parties with their own vested interests.
with by Dairy Companies Association of NZ (DCANZ). “Indisputably all
these matters are important, in particular our commitment to sustainable environment.
New Fonterra chairman John Monaghan (left) and chief executive Miles Hurrell.
But the charge on these matters should be led by DCANZ… whether a farm is supplying Fonterra or Synlait or Miraka. If say an OCD is not prepared to support DCANZ licence-to-operate standards, they should be exposed for it”. He also believes Fonterra has been too slow to change its capital structure. “In the 10 years I was involved in NZ Dairy Group, NZ Dairy Board and Fonterra, capital structure was never off the table. We were deal-
ing with a period of rampant growth. How did we balance equity for a Whangarei farmer who had been supplying his/ her cooperative for 30 years with a sheep farmer in Gore who was converting his farm to dairy? “We had to manage wealth transfer and capital structure was the tool.” He notes the days of Fonterra’s rampant growth are over and the issue now is retaining supply and preventing stranded assets – Capital structure must be
different if the objective is to retain milk rather than cater for rampant growth. “When a Fonterra farmer is considering supplying a company other than Fonterra, the discussion points are all around the value of Fonterra shares or the cost to buy more shares. “None of the discussion appears to be around Fonterra’s key objective of maximising milk price to farmers versus a non co-op paying just enough to attract supply.”
GDT BUYERS ARE IN NO RUSH PAM TIPA pamelat@ruralnews.co.nz
ALL EYES are on New Zealand milk production as the recalibration of fat prices continued at last week’s Global Dairy Trade (GDT) event, says Emma Higgins, Rabobank’s dairy analyst. Both anhydrous milk fat (AMF) and butter prices plummeted, with AMF slipping almost 7% to US$5321/ tonne – bringing prices back to end of 2016 levels – and butter lower by
8.5% to $4392/t. The overall price index was down 3.6%. The lower prices reflected weakness in fat markets offshore; and a 5000t lift in volumes of both AMF and butter on the GDT over the next 12 months would not have helped, Higgins says. Powder prices also slipped, with whole milk powder (WMP) down 2.1% to US$2883/t, and skim milk powder (SMP) lower by 1.3% to US$1951/t. “The general feeling is that NZ
milk production is anticipated to be plentiful, with benign weather conditions suggesting a strong start to the season and helped further by farmgate milk prices remaining strong,” says Higgins. “At this stage, buyers are in no rush to procure stock and are happy to wait and see how NZ’s spring peak pans out.” RaboResearch still anticipates milk production across the season to lift by 2%. It is forecasting a milk price of $6.80/kgMS for the current
season, to be updated in September. “All eyes will be on NZ production levels in the coming months, and if mild weather continues we could see stronger milk collections than our anticipated 2% growth, going some way to balancing out a potential deficit in Europe,” Higgins says. ASB is forecasting a $6.50/kgMS milk price with a downside risk. “The recent dairy gains from the lower NZ dollar look as though they may be short-lived,” says senior economist Nathan Penny.
The NZ dollar at one stage fell nearly 3% against the US dollar and this fall was boosting dairy prices in NZD terms. But the NZD had regained some ground against the USD this week, so that the NZD/ USD fall was now about 1%, Penny said last week. With Fonterra lifting its milk fat auction volumes forecast for the next 12 months – butter volumes were lifted by about 12% -- it was no surprise to see milk fat prices lead the auction price decline, Penny says.
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DAIRY NEWS AUGUST 28, 2018
NEWS // 5
Anchor tops China milk sales OWN PROCESSING?
Fonterra Greater China president Christine Zhu in Auckland last week.
SUDESH KISSUN sudeshk@ruralnews.co.nz
EXACTLY FIVE years
ago Fonterra launched its first Anchor milk product in China. A 250ml Anchor UHT milk produced at the Waitoa site went on a retailer’s shelf in Shanghai. This was followed by a joint online and offline push into the China market and today Anchor is the number-one consumer milk brand. Anchor milk is now sold in 13,000 stores in 220 Chinese cities. Anchor UHT milk is also the online bestseller in China with 55% of total sales made online. Fonterra Greater China president Christina Zhu, in Auckland last week to celebrate five years of Anchor milk brand in China, says Anchor now offers 47 products to consumers. These include high value milk foods, organic
sold by Anchor in China since its launch. Zhu says fighting for market share isn’t easy with 64 imported milk brands in China, but Anchor is proud to be retaining the number-one spot. Anchor sales have grown 40% year-to-year, not easy from a small base. She adds many FMCG companies are not
milk, infant formula, fresh milk, butter and yoghurt. Zhu says the 45% vs 55% offline/online sales mix is working well. “A lot of fast moving consumer goods (FMCG) companies would kill for this mix in China,” she says. Cumulatively 1 billion glasses of milk have been
growing in China. “Some of the global FMCG brands are declining in China; the 40% plus growth is huge; in fact it makes a lot of people very jealous of us in China.” Zhu pays tribute to her workforce; volume per person has increased seven times since 2014. “Things don’t fly off the
shelf; in China it requires a lot of hard work.” From day one e-commerce has been part of Anchor milk’s strategy and ‘genetics’ in China. Fonterra works with China’s two giant e-commerce retailers Alibaba and JD.com. China’s internet usage is astounding -- 770 million internet users.
FONTERRA IS pondering building plants in China for processing milk from its farms there. Christina Zhu says third-party manufacturers now process fresh milk from the 28,000 cows on its two farming hubs; a third hub is being built with global food company Abbott. ““We have farms, we have a big downstream business and we need manufacturing capability. Right now, it’s done at a few carefully audited third-party sites and we have Fonterra people working on these sites fulltime to make sure the products are safe,” she said. “There is a natural cap on how much you can do through third parties, so we’re assessing all the options, but we’re not in a position to say a definite timeline or make a commitment at this point.” Fonterra’s greater-China sales are at least $5 billion; foodservice and ingredients make the most. But China farms have bled money over the years and Fonterra’s investment in food company Beingmate has turned sour. Zhu says Beingmate gets a lot of attention but is a very small part of the total China business. “We are obviously disappointed; the business is not where we want it to be. But we are working closely with the new general manager to turn it around.”
Online sales last year topped US$812 billion, versus US$821b in the US, UK, Japan, Germany,
Korea and France combined. @dairy_news facebook.com/dairynews
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DAIRY NEWS AUGUST 28, 2018
6 // NEWS
Cash to develop goat milk formula THE DEVELOPMENT
From left: Dairy Goat Co-op chief executive David Hemara, Agriculture Minister Damien O’Connor and DGC chairman Campbell Storey at the launch.
of goat milk infant formula has received a funding boost. Caprine Innovations NZ (CAPRINZ) is a fiveyear, $30 million PGP programme joint effort by
the Ministry for Primary Industries (MPI) and Dairy Goat Cooperative (NZ) Ltd. Among other things, it is aimed at lifting export revenue in the NZ dairy goat milk industry to
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$400 million annually by 2023. It also seeks to improve the health and wellbeing of families and grow research and farming capability. Dairy Goat Cooperative chief executive David Hemara says CAPRINZ aims to strengthen the position of goat’s milk infant formula as the preferred alternative to cow milk infant formula. “We recognise breastfeeding as the best source of nutrition for babies and infants. Our aim through this PGP programme with MPI is to target consumers in NZ and overseas by meeting demand where breast feeding requires supplementation or isn’t feasible.” The CAPRINZ PGP programme is to enable all NZ goat farmers to measure and improve their performance, and to ensure that economic gains don’t come at the expense of the rural environment. “Because many dairy goat farms use off-pad-
dock animal housing there’s the opportunity to decrease the environmental impact of pastoral farming by conversions from other farming systems,” says Hemara. “Our programme aims to increase dairy goat numbers in the long term by 50% to over 100,000.” MPI director-general Martyn Dunne says they expect industry-wide benefits. “In addition to economic benefits, the CAPRINZ PGP programme also aims to create more than 400 new jobs onfarm, improve dairy goat farming practice and sustainable production, and boost capability across the industry. “It will also grow NZ’s research capability in the science of high-value nutrition and health, and establish a dairy goat research farm to deliver and trial its innovations.” Minister of Agriculture Damien O’Connor launched the programme in Hamilton.
A2 powers on THE A2 Milk Co more than doubled its profit to
$195.7 million in the year to June 30 – over 116% ahead of the previous financial year. The total revenue was $922.7m, a 68% increase on last year and earnings before tax were $238m, up 101% on last year. a2 Platinum infant formula sales revenue was $724.2m, an increase of 84% on the previous year. The company reported that sales of a2 Platinum infant formula again grew substantially in Australia and China, with continued growth in market share. The ANZ market share grew from 26% to 32% by value. a2 Platinum remains the fastest growing infant formula brand by value in Australia, the company says. Consumption market share by value grew to 5.1% in China. Distribution has grown to 10,000 stores in China and 6000 stores in the US. The company continued raising its brand awareness, expanding distribution in priority markets and adapting to new regulations in China. Managing director and chief executive Jayne Hrdlicka says full year 2018 has been a year of change. – Pam Tipa
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DAIRY NEWS AUGUST 28, 2018
NEWS // 7
Miraka suppliers score $3m bonus PETER BURKE peterb@ruralnews.co.nz
FOR THE second year
in a row, Taupo’s Miraka Dairy company has paid at least $3 million in bonuses to suppliers for their good overall performance during the 2016-17 season.
The company’s programme Te Ara Miraka financially rewards suppliers for meeting five criteria: people, the environment, animal welfare, milk quality and prosperity. Within these are 31 criteria -- 13 of them mandatory for farmers to meet. These in turn are extrapolated out into a
points system – all told 100. A supplier who passes the mandatory ones gets some incentive, but achieving 100 points will bring an extra 20 cents/ kgMS at the end of the season pro-rata depending on the points won. This year a Mangakino farm in the Wairarapa
Moana Trust scored 100 and got the maximum bonus. Miraka chief executive Richard Wyeth says the staff on the winning farm worked extra hard and got an outstanding result. In this second year for Te Ara Miraka the response from Miraka’s 110 suppliers has been
SMALL BUT SUCCESSFUL RICHARD WYETH knows that a small company can develop a greater sense of community among its suppliers, which the farmers wanted from the outset. Wyeth says they enjoy the annual shareholders’ meeting, “having conversations with the directors and being able to see people in the street around town”. “That plays a huge part and for me it’s fantastic being able to see all our suppliers in one place. With 110 suppliers we can take
everyone on the same journey at the same time.” He says performance reviews are difficult for some people, but they have to be done and help is available to get farmers through these. Change is inevitable and farmers must be prepared for this in a season full of uncertainty. “We are very comfortable with where we are placed in the industry. Our strategy has been consistent, our plants are full,
our suppliers say we have the best UHT plant in the country. “So we are well positioned to grow but there is more and more change coming to the industry and we just have to be prepared for that.” Of the ups and downs of the international market, Wyeth says all these will play out over time; they just have to keep an eye on things as they evolve. “We know it’s going to be more volatile than it was 12 months ago,” he says.
greater engagement and adapting to change, he says. Most of the farmers will get some sort of bonus; only a very few will get nothing. Te Ara Miraka is more than just producing lots of good milk, Wyeth says. It looks after staff, regularly reviews their performance and pays above the minimum wage. “We see it as an investment in the long term. All the things in Te Ara Miraka mean that onfarm we will deliver better results so it’s an investment in the farmer. Over time, as well as develop our branded business further it will help add value to the brands,” he says. Wyeth sees the provenance of food becoming a big concern for consumers. “For example, our Total Pure brand shows
Richard Wyeth
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Miraka will be built into the brands as well,” he says.
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DAIRY NEWS AUGUST 28, 2018
8 // NEWS
Eye-in-sky back in Waikato PAM TIPA pamelat@ruralnews.co.nz
THE WAIKATO Regional Council
has resumed aerial monitoring of ‘at risk’ farms by satellite imagery, drones, fixed wing aircraft or helicopters. This was revealed in the council’s response to a Forest and Bird (F&B) report which gave Waikato an ‘F’ grade -- the worst in the country -- for its compliance monitoring. The council says the F&B report contained information the council believes is “outdated, inaccurate and misleading”. But it also admits staff provided inaccurate information to F&B on enforcements. But the council has also revealed that aerial inspections were part of a more risk-based monitoring programme the council adopted in June this year. It will combine one-on-one visits to high risk farms with aerial inspections by satellite imagery, drones, fixed wing aircraft or helicopters. “Our new way of monitoring has only been in place for just over a
The Waikato Regional Council is targeting high risk farms.
month, and it is targeting high risk farms,” says farming services manager, Nicole Botherway. “That means it’s not surprising we’re picking up higher levels of non-compliance than we were previously, but it’s too soon to tell if this trend will continue.” The council in 2014 stopped aerial monitoring after farmers complained of feeling intimidated and intruded on. The F&B report also criticised the
council for making announced visits two years ago. But the council says announced visits enable staff to meet one-on-one with farmers to discuss their farm matters including minor earthworks, the Healthy Rivers/Wai Ora plan change and water consents. “Now a significant portion of the farming population have or are attempting to improve their systems,
and working with them one-on-one has helped,” says resource use director Dr Chris McLay. Local Government NZ (LGNZ) says the F&B report on dairy compliance monitoring shows the potential benefits of a national methodology for reporting. LGNZ’s regional sector is working with the Ministry for the Environment to develop a national system to enable
regional council compliance, monitoring and enforcement practices to be compared between regions. LGNZ regional sector chair Doug Leeder says Forest and Bird used an apples-vs-oranges approach in its report when comparing compliance, monitoring and enforcement between regional councils. Each council monitors and enforces according to the conditions of a resource consent and the planning approach taken is specific to its region. “A national reporting methodology will provide a much better platform for comparing data across different regional councils, and will take those differences into account, so we’ll be able to compare apples with apples.” The methodology used by the Forest and Bird researchers has led to inaccuracies in the report which could have been avoided by engagement with the sector, he says. Misinterpretation of the Waikato Regional Council’s data implied significantly non-compliant farms had not been visited for 10 years. This did not take into account the council’s aerial monitoring done before 2014.
No. 4928
DAIRY NEWS AUGUST 28, 2018
NEWS // 9
Farmers ahead of regulators PAM TIPA pamelat@ruralnews.co.nz
ONCE FARMERS have understood the environmental issues, they leaping ahead of regulators and do it anyway, says Federated Farmers president and dairy farmer Katie Milne. “Over-arching legislation can be difficult. It tends to be one-size-fitsall. And it doesn’t necessarily deliver what people need in their own communities,” she says. Milne was answering a question on how farmers would respond to more freshwater environmental regulations. Good management practice is being developed and “it would be really nice to see how far we can go with that,” she told an Environmental Defence Society conference. She cited her own experience of many groups coming together to reach targets at Lake Brunner where she lives. “We got on board and dealt with it and we reached the targets really quickly. All over the country there are catchment groups with farmers,
school kids and others involved.” A huge mindshift has occurred with farmers always pushing back to where they know they have issues. “Give a farmer a problem and they will try to solve it. We have farmers developing in-time monitoring devices that Landcorp and others will use. “We all want a better result now we are aware. It has been 150 year journey to get agriculture here to the point where we are at in New Zealand. Twenty years ago no one knew what diffuse nutrients were and the big impact they were having. There might have been indicators that things were going wrong. This information has come along and is helping inform us on where we need to go. “Farmers have genuinely picked up those issues. They are doing their best to solve them.” But she says there are always outliers and perhaps they need regulation to bring them into line. “We lack knowledge and have gaps all over the place. One thing farmers always scream out for is
clarity; if they understand where they are going that is a great start. “There are best practices and best ways now to get to the crux of it.
Katie Milne says many groups have come together to reach targets at Lake Brunner, near her farm.
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FIDDLING AT THE EDGES LANDCORP HEAD of environment Alison Dewes says she doesn’t believe “good management practice will get us there”. In some catchments land-use change may be needed rather than 10-15% reduction in nutrient loss from good practice. “We can’t talk about just fiddling around the edges in some of these really sensitive catchments. It might be transition – land use change.” The question is often posed as to how to set fresh water limits when the science is evolving. But she says markets, consumer preferences and population demographics are also involved. “Quite often people want this certainty thing. We will never know everything; we know that everything is changing all the time. We are getting new information all the time.” A “marriage between policy and science” is needed where policy is an important crux of it. “What can policy do in an uncertain world? It can actually start to set clear directions on where policy should go.” She suggested flexible policy could look at, e.g. letting farmers adjust transition pathways in accordance with their capital upgrade schedules, allowing credit trading between farmers, providing incentives and promoting innovation.
The hot points – where are the biggest impacts? – let’s go there and deal with those. At the same time everyone can be working on it.”
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DAIRY NEWS AUGUST 28, 2018
10 // NEWS
Committed to a low emissions economy GREG CAMPBELL
WHEN 60 heads of large New Zea-
land companies recently committed to a transition to a low emissions economy, some environmentalists were wary. While many were prepared to take these leaders at their word, they rightly said they were keen to see evidence of the commitment. That position is understandable: these companies are responsible for at least 50% of the nation’s greenhouse gas emissions. Despite the companies’ voluntary initiative, some may think the commercial world is slow to turn around. It’s not for lack of desire; everyone wants to be able to say they tried to leave the planet in better shape. That is why I was one of the signatory chief executives, representing Ravensdown. Our company has varied effects on the environment so we’re considering every facet of our operation and the
impact of farming practice, as well as emissions. We’re getting bolder and more innovative in the practices and technologies. Good intentions and the capability to make a difference are not enough. Scrutiny and ongoing transparency are expected and welcome. In order to ‘control the things we can control’ and get our house in order, we need to calculate our footprint first. The first step is transparency and accuracy about the many moving parts in our business which make up our footprint. We operate three manufacturing plants, seven lime quarries, 85 stores, a joint shipping venture and spreading aircraft and trucks. The first attempt at this assessment clearly identifies the shipping of minerals, rocks and fertiliser products as contributing to at least 75% of our carbon emissions. As part of our integrated reporting we have just publicly stated that everything linked to our operation, including international shipping, had
a carbon emission footprint of 154,407 tonnes CO2. Because New Zealand suffers from the ‘tyranny of distance’, the footprints of manufacturers are greatly affected by the fossil fuels used by ships. So we’re pleased that the UN’s International Maritime Organisation has agreed to cut annual greenhouse gas emissions by at least 50% by 2050. This is important because shipping in total worldwide is reckoned to be the world’s sixth-largest emitter of carbon dioxide – roughly the same as Germany. Autonomous ships and fuel cell technologies are beyond Ravensdown’s control but we can control our manufacturing and distribution. We estimate that these emit 31,000 tonnes of carbon dioxide, including fuel for transport NZ-wide and for drying ag lime to make it suitable for soil.
Greg Campbell (inset) says everyone wants to say they tried to leave the planet in better shape.
We have started identifying what could and should be done to cut carbon emissions, an important non-financial metric. We are discovering many things we can and will try to reduce our environmental impact. For example, making superphosphate results in heat generation, and our plants generate electricity for their processes and for the national grid. So
we are looking at how to reduce emissions and boost efficiency of that generation. We intend to be upfront, reporting on progress or shortcomings, aiming ultimately to ensure that people who now expect more from business leaders are not disappointed. • Greg Campbell is chief executive of Ravensdown
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DAIRY NEWS AUGUST 28, 2018
NEWS // 11
No change to Nat’s water policy PAM TIPA pamelat@ruralnews.co.nz
NATIONAL’S POSITION has not changed
on a water tax or levy, says Opposition Leader Simon Bridges. “National will not introduce a tax or royalty on commercial water users – outside of a possible levy on water bottlers who export water,” he says. Dairy News asked if the party’s position on a wider water tax had changed after he told a radio show he was open to a water tax on bottled water. “Charging for water bottlers who export is a hard issue,” he told Dairy News. “In Government, we were working our way through it. Our
water technical advisory group included the issues around export water in their considerations; that was due to report back in November last year. “National’s view is we are open to charging water bottlers who export, but the policy needs to be developed carefully to ensure it is consistent, fair and workable. “Water policy can’t be done in isolation; it needs to be considered [in respect of] other big users such as soft drink manufacturers, beer producers, and irrigators and hydro power generators. “It also is tied up with the complex issue of iwi rights and interest in fresh water. This is a complicated issue which needs to be appropriately considered.”
Bridges had earlier told The AM Show that if you put a price on water there will be a variety of interest groups, including iwi, taking you to court.
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only wanted the levy to apply to bottled water, saying Labour’s plan would result in cabbages costing $18 each, Newshub reported.
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NEW RESEARCH into genetics and breeding could lead to New Zealand raising livestock with lower nitrogen emissions and so lower greenhouse gas effects. Two research projects are looking into the possibility of a link between the nitrogen content of milk and animal emissions, and the possibility of identifying then replicating genes to control the level of animals’ nitrogen emissions. Fonterra’s Less Footprint programme manager, Dr Mike Scarsbrook, says the research is showing that what an animal eats, and genetic factors, play a part in how much nitrogen it excretes. “This means if animals with lower nitrogen emission can be identified, that trait can be bred into the national herds and the whole country can benefit from lower emissions,” he said. Nitrous oxide is a small but critical part of NZ greenhouse gas emissions, making up 12% of all emissions in 2016. Like methane, nitrous oxide is a strong contributor to climate change because it more effectively traps heat than carbon dioxide – by about 300 times. But unlike carbon dioxide, which can last for thousands of years in the atmosphere, nitrous oxide breaks down in about 114 years. AgResearch, Massey University, DairyNZ and Abacus Bio are the research partners and Fonterra is helping to fund it. AgResearch has also filed for a patent that builds on this work and provides an option for new tools to identify the low-emitting animals at a genetic level.
Labour’s proposed 2c/1000L levy on commercial use was canned when the party did a deal with NZ First to form the government. NZ First
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DAIRY NEWS AUGUST 28, 2018
12 // NEWS
Land covenant means forever NIGEL MALTHUS
FARMERS WHO want
to protect parcels of their land from development can take heart from a recent Supreme Court
decision that “in perpetuity” really does mean forever, says Federated Farmers president Katie Milne. “Rural and farming families comprise the majority of landown-
ers behind the more than 4400 covenants in New Zealand and they make this commitment to protect bush, wetlands and other areas of special biodiversity on their properties so they can be
• • • • • •
enjoyed for all future generations,” said Milne. The Supreme Court ruled last week that a QEII National Trust covenant over a 400ha block near Tairua, on the Coromandel Peninsula, was
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valid. The owner, a reclusive man who lived in squalor after a homestead on the property burnt down, established the covenant shortly before he died in 2003. The current owner has been trying to overturn it so the land can be subdivided for residential development. QEII National Trust chief executive Mike Jebson said the ruling was the culmination of a five year battle through the High Court, Appeal Court and Supreme Court, all of which had now ruled in favour of the trust. “It creates a really important precedent for the sanctity of covenants.” Jebson said about 20% of all farms have some covenanted land. “We’ve always worked closely with the farming community to support the intent of farmers to protect the lovely bits of native forest, wetlands and other special places on farmland.” Milne said farmers were accused in some quarters of being no friend to the environment, yet farmers were pivotal in setting up the QEII National Trust 40 years ago. “Rural landowners have been the instigators of more than two-thirds of QEII covenants since 1977 and a study last year
by Waikato University estimated the opportunity costs associated with covenanted land in New Zealand is in the range of $443m to $638m,” she said. “The total estimated maintenance on covenants is $25m a year. So farmers have plenty of skin in the game with this form of biodiversity protection and we’re delighted to see the courts rule in favour of the original landowner’s vision for protection in perpetuity vs a developer keen to turn a buck,” said Milne. Jebson said the trust would early next year be defending another covenant in the High Court from a company that wants to quarry covenanted land on the edge of the Kaimai Range near Matamata. “So this isn’t the only case of landowners who buy protected land then try to get the protection overturned so they can develop it; but our role as trustee is to support the intent of the original landowner to ensure this land is protected forever.” “This Supreme Court decision will help us in terms of the sanctity of the covenant. It just shows how legally robust covenants are against the actions of new landowners who try to overturn them,” he said.
Or fill in this form and post it to: Dairy News, Win a Suzuki Kingquad competition, PO Box 331-100, Auckland 0740
Q: What publication did you see this promotion in? Answer: .......................................................................................................................... Name: .............................................................................................................................. Address: ........................................................................................................................... ......................................................................................................................................... ...................................................................... Phone: ...................................................... Email: ............................................................................................................................... Terms and Conditions: Information on how to enter the competition forms part of these terms and conditions. Entry in to the Win a Suzuki Kingquad competition is deemed acceptance of these terms and conditions. Entry is open to all New Zealand residents except for employees of Rural News Group and their immediate family. Each entrant may enter more than once. To be valid, each entry must contain the correct answers as determined by the Rural News Group. The competition opens on Monday August 6, 2018 and closes Friday November 2, 2018 at 11pm. The prize winner will be drawn on Monday November 5, 2018 and will be contacted by phone and email by Wednesday November 7, 2018. The winner will be announced via email by Friday November 9, 2018.The promoter’s decision is final and no correspondence will be entered in to. By accepting the prize, the prize winner consents to the promoter using his/her details, photographs and recording of the prize acceptance for promotional and media publicity purposes. There is one prize of a Suzuki Kingquad 500 XE ATV. The winner may be required to pick up their prize from their nearest Suzuki dealer. The prize is valued at $16,995. The prize is not transferable or redeemable for cash. All insurance and any on-road costs are at the winner’s expense. All entries become the property of the promoter. The promoter is Rural News Group, First Floor, Bayleys Building, 29 Northcroft St, Takapuna, Auckland 0622
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DAIRY NEWS AUGUST 28, 2018
NEWS  // 13
High Court puts price on safety breaches by employers MARK DANIEL markd@ruralnews.co.nz
A RECENT High Court judgement stemming from the 2015 Health and Safety at Work Act gave guidelines to sentencing people found guilty under Section 48 of the Act (failing to comply with a duty and exposing a person to risk of death, serious injury or illness). A PCBU (person conducting a business or undertaking) has clear responsibilities under the Act. The 2015 legis-
lation covers corporates, sole traders and selfemployed, whether profitintended or non-profit. In farming that means that any employer or their agents who employ staff are subject to the Act irrespective of the manner or terms of the employment. The Act requires the PCBU to protect the health and safety of workers or any other workers influenced or directed by the business. That might be a farmer who sends a visiting contractor to work on a dangerous hill-
side, or the contracting company’s owner for allowing it to happen; both would be in breach of the Act. As for the duty of care and exposure to risks, the Act covers topics such as lighting, ventilation, dust, heat and noise. The PCBU is also responsible for overcrowding, deadlines, arrangements such as shift-work and rest breaks, fatigue, stress, drugs and alcohol. In the August 9 ruling, the court agreed with WorkSafe over its application of a four-step
The High Court has endorsed a four-step plan to address serious safety breaches on farm.
plan to address serious breaches of the Act. Step one: the amount of reparation paid to victims of negligence; step 2 is to determine the amount of the fine placed on the PCBU, considering aggravating and mitigating factors. The starting point of any fine will depend on the culpability of the offender and the gravity of the offending. Low culpabil-
ity could bring a fine up to $250,000; medium culpability from $250,000 to $600,000; high culpability from $600,000 to $1 million; worse cases $1 million to $1.5m. The court recommends reductions for mitigating factors. The third step of the process is assessment of any other orders imposed, such as the granting of costs to the
regulatory authority. The fourth stage is a proportionality assessment, where a court will look at the whole sentence, considering reparation awarded, the fine and any other costs to consider whether the cumulative effect is proportionate and appropriate for the circumstances. An offender’s financial circumstances might bring adjustments made
up or down. WorkSafe welcomed the judgement and said the four sentencing bands should deter would-be offendors. It also agreed with the court that reductions in the penalty are appropriate when offenders have assisted victims of the offending or gone the extra mile to ensure that the underlying cause has been dealt with.
DAIRY NEWS AUGUST 28, 2018
14 // NEWS
Is it really milk? JOANNE BILLS
LOTS OF talk is heard
about alternative – or non-dairy – milks and whether to ban the word ‘milk’ in that context.
A lot people in the dairy sector are getting excited about the US Food and Drug Administration (FDA) considering how it will enforce the definition of milk on beverage companies that use
the word on products not derived from a cow or any other animal. As in Australia, FDA regulations already specify that milk is a lacteal or mammary secretion of milking animals. The
issue is these standards of identity haven’t been enforced, and FDA commissioner Scott Gottlieb is considering whether they should be. “An almond doesn’t lactate,” has been the widely reported quote from Gottlieb. As in Australia, the US dairy sector is keen for these standards of identity to be enforced for milk and other dairy terms. The National Milk Producers Federation (NMPF) believes using dairy terms including ‘milk’ for plant-based alternatives is misleading consumers. While no one would argue that consumers encountering a pack of soy ‘milk’ are confused about whether the product comes from a cow, they could be confused about the nutritional value offered. While plant-based ‘milks’ are alternatives for usage, they are not exact substitutes for nutrition. To support its claims, the NMPF surveyed 244 plant-based beverages from the Washington DC area and found that none delivered equivalent nutrition to real milk. One global dairy processor – Danone – has come out in favour of the status quo on product names. It says that dairy and plant-based products are clearly labelled with nutrition facts so people can choose the one that suits their dietary needs and preferences. It is galling for many in the dairy industry, and farmers in particular, that
Should almond milk be called milk?
plant-based competitors use the words milk and cheese to convey – to most consumers -- an aura of health, nurturing and familiarity, particularly as these alternatives continue to erode the market for the real thing. In the US, the dairy industry has an unlikely ally in the fight for milk. PETA also thinks plantbased beverages deserve to be distinguished from ‘udder secretions’. To PETA, milk is a “four letter word”: nothing gets past these people. A new Morning Consult/Politico poll in the US suggests some consumer support for enforcing the definition of milk, with 46% of surveyed adults saying the term shouldn’t be used to describe non-dairy beverages. The poll of 2203 people found support for not using milk on plantbased beverages was highest in the 65-plus age group at 66%, but lowest in the 18 - 29 grouping at 39%. Which group do you think is more likely to buy plant-based beverages? Between 2012 and
2017, US sales of nondairy ‘milk’ increased 61% in the US to an estimated US$2.11 billion, says Mintel, while dairy milk sales have fallen 9%. The Mintel researchers found one in five US consumers were consuming less dairy for health reasons – a concern for an industry that has positioned itself on a nutrition platform. The other interesting finding was that 90% of plant-based ‘milk’ consumers also buy dairy, so choices may not be quite as binary as we would imagine. It’s debatable whether removing the word ‘milk’ from these products would prevent the march of plant-based beverages. As well as health concerns, consumers are turning to plantbased beverages that they believe are more ethical, better for the environment and because of lactose intolerance – whether real or perceived. Innovation is another driver: while almond, coconut and soy remain the most popular milk alternatives, hardly a month goes by before
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something else gets ‘milked’ – pecan, quinoa, hazelnut and flax are recent examples. Some of the perceptions of the environmental credentials of plant-based alternatives are questionable – especially almonds – and could be challenged. Dairy also has to keep its own sustainability house in order, and tell the story effectively. The ethical issues for hard-core vegan types will never be addressed. Milk has been a staple for centuries because of its health benefits – a nutritional package designed by nature. This often gets lost with the waves of new ‘superfoods’ on the block. Innovation is seriously lacking for a category taken for granted and under siege. Innovation – not regulation of the name -- will keep ‘real milk’ relevant for many consumers now and in future. Even if this battle is won, dairy needs to stay focussed on the war. • Joanne Bills is a director of Australian food consultancy FreshAgenda.
DAIRY NEWS AUGUST 28, 2018
16 // NEWS
Wet winter for NZYF farm BRAD MARKHAM
Heifers at the NZ Young Farmersowned farm in Auckland.
THE COVERED cow shelter on the NZ Young Farmers-owned Donald Pearson Farm has come in handy during a wet winter. The modern facility on the 74ha Auckland dairy farm has been used to feed grass silage to the dairy herd.
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“It’s been a particularly wet winter on the farm,” said the chair of the Donald Pearson Farm board, Julie Pirie. “The new manager Tom Ruki has done a great job utilising the
Two new members have joined the Donald Pearson Farm board. Stu Muir has replaced Tiaki Hunia and Sam Robinson will be the NZ Young Farmers board rep. “Stu is a well-known
“We’ve just had some ammo flown onto the paddocks by helicopter because it’s so wet.” herd home to minimise pasture damage,” Pirie says. Calving started on July 10, early for such a wet farm. “Ideally the planned start of calving should be between July 20 and July 25,” she says. Earlier this month, 70 of the 120 Jersey and milking shorthorn cows had calved. Jerseys are a new addition to the herd, with 61 arriving on the property in late May. The milkers were being fed meal through an in-shed feed system in the 11-aside herringbone shed. “The meal is used to help stay on a long round until the grass starts growing,” says Pirie. “We’ve just had some ammo [fertiliser] flown onto the paddocks by helicopter because it’s so wet. That happened a fortnight later than we had hoped because the helicopter has been so busy.”
Waikato dairy farmer who has excellent environmental stewardship credentials and a strong connection with iwi and young people,” says Pirie. “Sam brings in a lot of governance experience to the board.” Former chief executive Terry Copeland will continue serving on the board for the foreseeable future. NZ Young Farmers members will get a chance to visit the farm for a planning session. The day is being organised by northern region Young Farmers. “It will be an opportunity for a brainstorming session so we can be assured the board’s and members’ plans and vision for the farm align,” says Pirie. The property will farmed while its future as an educational farm is mapped out. • Brad Markham is communications manager for NZ Young Farmers.
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DAIRY NEWS AUGUST 28, 2018
NEWS // 17
Keytone Dairy products
Christchurch processor buoyed by capital raising new facilities at Rolleston, expanding across the board.” The new Rolleston plant will give a KEYTONE DAIRY, a Christchurch- four-times-bigger blender, producing an based manufacturer, packer and exporter additional 3500 tonnes per annum, new of powdered dairy products, has listed on canning machinery, warehousing, and the the Australian Stock Exchange (ASX) as space to load and handle multiple conit raises capital for a major expansion of tainers. The walls are now going up, with its Canterbury manufacturing operation. equipment to be ordered soon The company produces a and the building expected to range of dairy-based food and be complete by September. health powders but says it has Production should begin in already run out of space at its the first half of 2019. modern blending and pack“The key point of differenaging plant built at Sockburn tiation for Keytone as opposed in 2013, and is building a new to some of our competitors is plant at Rolleston’s i-Zone busithat it’s not a build-and-hope ness park. James Gong strategy, it’s a build because Keytone’s founder and Manwe have the demand there aging Director James Gong, who has a 27-year history in the dairy industry from our customers,” said Thompson. “We’re out of capacity here (Sockburn) including several years as head of sales for Asia at Westland Milk Products, said the and logistically it’s become a challenging new plant would allow it to expand both site to operate just given our space constraints.” its volume and range of products. “The IPO allows us to accelerate the It blends powdered product from Fonterra, Synlait and others, and packages growth plan significantly from where we under its own Key Dairy, KeyHealth and would otherwise have been if we hadn’t FaceClear brands as well as contract pack- raised the level of funding that we have.” The company’s products include a aging for other brands. It supplies supermarkets in New Zealand and Australia and calf milk replacement being supplied to Kobe beef producers in Japan. That exports to Asia, especially China. Through its subsidiary Key Dairy Cor- was launched in May after trials in 2017 poration, it listed on the ASX on July 18 showed significant improvements in after successfully raising A$15 million in calves’ survival rates. Gong said the company recently began an oversubscribed share issue of 75 million ordinary shares. The $0.20 issue-price producing its first “wet” product, an anhyshares were recently trading around $0.29. drous milk fat intended as a butter substiOn a visit to the Sockburn plant, Syd- tute for commercial bakeries, hotels and ney-based Chief Financial Officer Jourdan confectioners. It was ideal because it is stored at Thompson explained the company listed on the ASX rather than NZX because a key room temperature, unlike butter which shareholder was Bergen Asset Manage- had to be refrigerated or frozen because ment, which had a lot of familiarity with of its high water content. He said the first order came within a the Australian market. More importantly, he said, the “pools of capital” were much day of the product launch, from a leaddeeper in Australia than in New Zealand. ing baking ingredients supplier in Taiwan. Gong said the current Sockburn fac“But I think the point to make is that the funds raised through the listing are tory would be retrofitted to make new bioall being invested into New Zealand, into active products such as yoghurt powders, the local Christchurch community. We’re which must be produced at separate sites increasing employment, we’re building to avoid cross-contamination. NIGEL MALTHUS
DAIRY NEWS AUGUST 28, 2018
18 // NEWS
Snacking taken to a new high by Fonterra beverage Fonterra is launching a milk beverage to tap into the emerging consumer trend called ‘snacking’. The aim is to replace pies, crisps and sugar-filled soft drinks. Production is by new technology at a new plant in a deal with an apple juice processor. PETER BURKE reports. IN A large industrial area
near Hastings, Apollo Foods has set up a new processing plant, the brainchild of apple industry entrepreneur Ross Beaton who intends to make a quality, long life apple juice. But the plant can do more than process apples: the technology is perfect for producing quality long life milk beverages, which Apollo has agreed to do for Fonterra. Darren Moffat, Fonterra general manager of ready-to-drink lifestyle beverages, says its new product Anchor Protein + stems from the coop’s research of market trends. “There is a huge trend towards convenience snacking with consumers looking for healthy alternatives. Many people now don’t have time to sit down for breakfast or lunch, but they want quality snack food. The Anchor protein drink meets this need: it has 20g of protein and it’s healthy -- no added sugar.
“In metro areas many people are money-rich but time-poor. This gives us an opportunity to innovate and cater to those trends and add convenience and healthy food into people’s lives,” Moffat says. Anchor Protein + was launched about a week ago but may take a few weeks to get to all outlets in New Zealand. It
will initially be sold only in NZ but raising capacity will enable the co-op to take it global. “We see the home patch as the showroom for going global,” he says. Anchor Protein + is like the Primo and Mammoth lifestyle milk drinks that are now long-life. Until processing began at the Hastings plant earlier this year, Primo and
Mammoth fresh milk products were made at the Fonterra plant at Takanini in south Auckland. All these brands are now made at Hastings. “The move to long life enables us to cater for future trends. Although there is UHT capability at Takanini, the facility at Hastings has the most up-to-date technology and will enable us to expand our production of these new high value products. This makes sense,” he says. Market research plays a big role in how Fonterra develops new value-add
products. Convenience and snacking are two drivers the research has discovered. “Indulgence, funnily enough, is a trend you see around NZ; when Kiwis treat themselves they go big. So the question is how do you tap into that as people become more conscious of the ingredients in a product and query what this
might mean for their diet?” Moffat sees massive
opportunity in the market and the co-op will go after that in ways that differ from the traditional walk to the dairy to buy a drink.
Fonterra’s Darren Moffat with the new Anchor protein drink.
PARTNERSHIP ADDS VALUE THE PARTNERSHIP between Apollo’s apple juice and Fonterra’s lifestyle drinks is working well, says Darren Moffat. It isn’t a joint venture, but Fonterra has injected capital into the business which effectively buys them guaranteed processing time. Milk is delivered daily to the plant from Fonterra’s milk collection facility at Palmerston North and is immediately stored and chilled. About 8000L is set aside as a slurry into which go all the ingredients for the type of milk to be produced, e.g. flavours and vitamins. The remainder of the milk is then added and it all goes to a sterile tank in preparation for bottling in a
sterile environment. The bottle enter the process in small form and are then blown up to the correct size for filling, labelling and packaging. The plant can fill 12,000 Anchor Protein + bottles per hour, constantly checking the bottle, their fill heights, caps and the milk itself. The plant has its own laboratory for product testing. Moffat says the products are a good example to farmers of their milk going into quality value-add products. “This is true innovation with Fonterra developing new business opportunities for growth locally and globally,” he says.
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DAIRY NEWS AUGUST 28, 2018
NEWS // 19
Walking a tightrope to profit PAM TIPA pamelat@ruralnews.co.nz
DIRECTLY COMPARING Fonterra with Open
Country and Synlait is unfair, but nevertheless Fonterra as a business hasn’t performed well, says Nic Lees, senior lecturer in agribusiness management at Lincoln University. The splitting of Fonterra’s high value versus commodity business might sound good but it is hard to run a high value business without having a commodity arm, he says. This is particularly so for Fonterra because it can’t control its supply from farmers because of DIRA. “Fonterra has about 10,000 suppliers while those other companies have suppliers in the hundreds,” Lees told Dairy News. “Some of the markets the smaller ones are selling into, for Fonterra they probably wouldn’t have a huge impact on their return; they are a small part of the market.” The smaller companies can “cherry pick” because those markets make a big difference to their profitability, he says. “Fonterra will always have to be in that commodity business just because they are responsible for 30-40% of the total trade in dairy products in the world. That
is a huge volume to make sure they can sell every year. There is a big requirement on Fonterra to sell a large amount of commodities because they couldn’t put all the volume into niche products.” Lees says, for instance, a good proportion of what Synlait produces is A2 and its share price has followed the a2 Milk Company share price upwards. “But the volume of A2 as a percentage of Fonterra processing would be a very small proportion. Even going into something like A2 probably wouldn’t necessarily have a huge impact on [Fonterra’s] bottom line.” However if Fonterra had bought the a2 company when it had the opportunity it would have made a lot of money – an example of questionable business decisions. Lees says in regard Referring to the suggestion of splitting Fonterra in two, Lees says many people don’t realise that any agribusiness or processor needs to have a commodity side to its business. “Synlait exports a proportion of their product as skim milk powder or whole milk powder or anhydrous milk fat,” he says. “If you are dealing in niche markets you need
“Fonterra will always have to be in that commodity business just because they are responsible for 30-40% of the total trade in dairy products in the world.”
Nic Lees, Lincoln University.
to be able to control the volume of supply into those markets because you can easily have a surplus and that will drive the price down. “If you look across dairy, meat, even seed companies – they will sell product into the commodity market just to be able to manage their high value markets. Those markets generally require a consistent supply of customised product. With a very seasonal system there will be times of the year where there is excess product produced. Unless you able to put that into the commodity market, it will effectively damage your high value markets. “DIRA is a huge weight on [Fonterra’s] business because it means they have to increase their processing capacity based on farmers coming in to supply them and they also can’t select the quality of their farmers,” he says. A huge increase in volume has often forced
Fonterra to push product into the commodity market, requiring heavy investment in processing and borrowing money. Farmers are fairly indebted so they don’t want to invest more in Fongerra than they have to. “Synlait, Open Country and Tatua very tightly control their number of suppliers to make sure that matches their demand and
processing ability.” Fonterra has had to make decisions that are less than optimal from a business perspective just because they can’t control suppliers. “They have to accept additional volume and they may not be able to get the best price in the market, because they have such a large amount to sell.” Farmers could choose to leave Fonterra and supply another com-
pany. “But a lot of farmers want to stick with Fonterra because they see that having farmer control is an insurance policy against having the milk price pushed out,” he says. They see shares as a means of controlling the processing market and a guarantee they will get the best milk price return. “However over the last few years that has been a very high priced insurance policy.” The DIRA requirement for Fonterra to take more milk is a drag on profitability. But industry growth may slow and that may help Fonterra. Synlait has a Chinese investor with deep pockets and they can
raise money on the stock market as they did two years ago. “They don’t have to make volume investment; they can invest in infant formla, canning lines, high quality products like lactoferrin and niche products that would be a relatively small proportion of what Fonterra has to process. If you change farmers from having a guaranteed market, they themselves would have to make better business decisions and make the business case for increasing their farm’s production. • Nic Lees, senior lecturer in agribusiness management at Lincoln University, came to the university with 20 years experience in various agribusiness roles.
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DAIRY NEWS AUGUST 28, 2018
20 // NEWS
Oz farmers starting to pull the plug RICK BAYNE
A brown landscape on Vanessa Todd’s farm, Yattarna, near Bodella on the NSW South Coast.
FARMERS IN New South Wales are digging in to survive as the drought worsens. With the vast majority
of the state’s farming land in drought conditions, and feed and water prices hitting record levels, some farmers are considering their future in the industry, and a few are now quitting.
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NSW Department of Primary Industries’ (DPI) combined drought indicator shows 15.3% of the state is in intense drought, 36.4% is experiencing drought and 48.1% is drought affected. Only 0.1% of the state is described as nondrought and 0.1% as recovering. The chair of NSW Farmers dairy committee and owner of Little Big Dairy Co in Dubbo, Erika Chesworth, said the big dry from Queensland is heading south. “The dry area is expanding and there’s big pressure on the dairy industry,” she said. Despite the difficulties and gloomy outlook, Chesworth urges farmers to maintain their social ties, seek financial counselling and “spend to prevent disaster”. “It comes back to basic stuff: do the little things properly, don’t carry unproductive animals, look at your reproduction, teat spray, vaccinate. “I encourage farmers to consider employing a consultant, look at your budget, know your costs and be sociable; that really helps. Have people around and take weekends away; try to keep a balance. “Some cope with these pressures better than others. It can depend on what cycle your business is in but generally farmers are negative at the moment.” While her farm at Dubbo locked in good grain prices at harvest, Chesworth admitted feed costs are getting “out of control”. “I’ve heard crazy quotes like $700 a tonne for lucerne hay; $600 for barley. It’s really gone off the scale.” There will be crops grown south of West Wyalong this season but farms without irrigation and not getting rain are under incredible stress, Chesworth said. “A month ago we were still hopeful of getting late winter rain in this region; not so much now.” Chesworth welcomed
new government initiatives to help farmers but said they don’t always go far enough. “They’ve just put out a freight subsidy on fodder and we’re grateful to everyone who advocated for that, but the cap of $20,000 is a laughable amount; that’s what we were getting 20 years ago. I’m not saying it’s not helpful but dairies are much larger than they were 20 years ago and there’s a greater dependence on purchased feed.” The DPI’s Rural Assistance Fund plans to support struggling farmers with financial counsellors and interest-free loans. But Chesworth says most farmers are doing it tough. “It snuck up on us. Our farm is in a onein-20-year dry. It’s worse than 2006 and that’s quite surprising.” Finley farmer Neville Kydd said farmers in the area had been going okay “but it’s starting to get to the pointy end”. “It’s getting to the irrigation season and there’s no irrigation water available and if you go to the trading market they’re indicating 350/megalitre and rising. Realistically there’s no money in it for dairy farmers at the moment.” The Kydds have good supplies of silage but Kydd added “that’s not endless”. “Last time the drought was for three years. We’re at stage one, with silage on hand, but if it’s another three years the reserves will be gone.” In the 2006 drought the Kydds used palm kernel expeller but that is no longer imported. “It’s not everything and nutritionists don’t like it, but it sustains animals and extends what you’ve got quite well. It saved our arse last time; we used about 4500 tonnes of it.” Kydd predicts farmers will be forced to leave the industry. “Come middle or late spring, if it doesn’t improve dramatically a lot of people are just going to pull the plug and shut down.”
DAIRY NEWS AUGUST 28, 2018
NEWS // 21
RUBBER FIRM BOOTS UP PROFIT IN THE year Skellerup’s iconic Red Band gumboots turn 60, the company is celebrating a record profit. Tabling its annual result for the year ended June 30, the plastics and rubber manufacturer reported revenue of $240.4 million, up 14% on the previous corresponding period (pcp), record earnings before interest and tax (EBIT) of $39.8m (+21% on pcp) and a record net profit after tax of $27.3m (+23% on pcp). The company’s agri division, which makes Red Bands, milking platform wheels, milking cup liners, tubing, pumps, heat exchangers and teat sprayers, contributed $22.8m to EBIT, up 15%. The industrial division, which makes components such as seals and valves -- often critical parts in other company’s products -- contributed $20.8m, up 21%. Chief executive David Mair said the agri division achieved an excellent “record result, continuing steady growth particularly in global markets”. “We develop innovative and high quality dairy components and specialist footwear designed and manufactured to meet the specific needs of customers. “The completion of our new factory at Wigram in 2016 and the subsequent sale and disposal of the Woolston site have enabled our agri team to develop an external focus on customers and growth. We are beginning to see the benefits of this strategy, with revenue increasing by 12% to $89m in the current year.” Mair said New Zealand is agri’s largest single market, but international markets contribute at least half the revenue and have growth prospects. “This is driven by a growing Asian middle class and global demand for milk protein. Our dairy rubberware, milk filters and animal hygiene products play a crucial role in maintaining milk quality and protecting animal health.” Mair noted Skellerup’s fame in NZ for its Red Band gumboots, first made in October 1958. “Leveraging this long-established technical knowhow we develop and grow our footwear range, including our fire-fighters’ boots that are worn in NZ and Australia and now by many UK fire brigades.” – Nigel Malthus
Chairman’s king of co-ops LIC CHAIRMAN Murray King
has won the Cooperative Leader of the Year award. Presented this month in Christchurch at the Cooperative Business NZ Awards 2018, the award recognises strong leadership and commitment to the co-op sector. King, a Nelson dairy farmer, has a longstanding links with LIC and dairy farming in the upper South Island. He was first elected to LIC’s board in 2009 and has been re-elected twice as chairman since 2012. LIC says as chairman, King has steered LIC through significant change and disruption in the dairy sector. His vision and leadership was vital to the success of LIC’s recent
Murray King
business-wide transformation, made to keep the co-op fit for the future. It included simplifying the share structure as fairer for share-
holders, and seperating LIC into two businesses. The transformation has so far brought $60 million in recurring
revenue and $30.7m in one-off benefits for the cooperative. LIC’s most recent results showed it had its best-ever annual revenue. Chief executive Wayne McNee says King has shown exceptional leadership over the past three years, navigating unprecedented disruption in the industry and protecting and growing LIC for the benefit of its 10,500 shareholders. “As a strong advocate for the co-op model generally, Murray has worked tirelessly to engage and consult with the New Zealand farming community to ensure their voices continue to be heard.” The award was presented at the Cooperative Business NZ’s annual dinner in Christchurch this month.
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DAIRY NEWS AUGUST 28, 2018
22 // OPINION RUMINATING
EDITORIAL
No excuse
MILKING IT... Gone feral
Not all clover
Clinkety clink
Glug glug
THE ANTI-1080 crowd seems to have gone completely feral. Their self-righteousness has long been seen, but now the lunatic fringe’s violent tendencies are out of control and they’re threatening human lives. Their belief that a feral animal’s life has more value than a human’s shows they’re completely off the reservation. They’ve also been telling porkies on social media to which DOC has responded with facts -- you know, statements backed by scientific evidence. 1. Benefits from 1080 use to wildlife are real and measured. e.g. Southland kaka now produce 30 times more chicks. 2. 1080 does not bioaccumulate. It breaks down in water and soil and does not affect native fish. More facts here: www.1080facts.co.nz
WITH MANUKA honey selling for $200/kg all beekeepers must be swimming in cash, right? Not if your hives are doing the donkey work of primary-industry pollination, namely pasture and horticultural crops. MPI estimates bee pollination of crops grown for seed, fruit and veg and key pasture species like clover adds a couple of $billion to our economy. But the return to beekeepers producing mainly pasture honey is down to $5-6/kg, according to a mate of Milking It who has been 50 years in the bee game. He says the perception of wealth created by the manuka boom is leading landowners to push for a bigger cut from beekeepers and Apiculture NZ to push for a bigger levy. With no margin to give, the smaller beekeepers, once the backbone of the pollination industry, are being forced out of business, leaving the corporates whose main interest is manuka. What would Sir Ed say?
AS THE movement away from plastic accelerates, one wonders if plastic milk bottles will be next. The clink of milk bottles is on something of a comeback as boutique dairy companies opt for glass over plastic. Driven by consumer demand for environmentally friendly milk, several smaller players in the dairy market are choosing to sell their product in reusable glass bottles. New Zealand recycles 23,000 tonnes of plastic milk bottles per year.
IF YOU enjoy a breakfast of milky cereal and tea, then today is your lucky day. Because Canadian scientists now believe that starting the day with a high-protein milk meal could help keep type 2 diabetes at bay, and even help you to lose weight. A team from the human nutraceutical research unit at the University of Guelph (with the University of Toronto), have studied the effect of milk at breakfast on blood glucose levels and hunger. They’ve found that it reduces blood glucose levels more than does water. And having high-protein milk is even better than the regular stuff. Milk containing more protein also reduces appetite later in the day, compared with lowerprotein dairy.
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FARMERS ARE unhappy and confused with the NAIT changes rushed through Parliament into law. Social media has been abuzz with angry farmers demanding a ‘please explain’ from DairyNZ and Beef + Lamb NZ on why they are publicly backing the changes. One Northland dairy and beef farmer tweeted “please explain why [you] supported the draconian changes to the NAIT Act which treat farmers like terrorists. Why should I pay my levy/ sub if u can’t stand up for us?” The same farmer had an interesting exchange with DairyNZ chief executive Tim Mackle on Twitter. In his tweet Mackle hinted they were blindsided by the extra changes put through by the Government. “None of us had anything to do with the S&S (Search and Surveillance) Act provisions put into NAIT changes. As Katie [Milne, Feds president] wrote, ‘we all supported 38 recommendations from the NAIT review, but nothing on S&S which was done under urgency without consultation & communications -- not good’.” The Government has labelled the changes “a package of technical law changes to support the Mycoplasma bovis eradication programme”. The changes go no further than powers that already exist under other acts, which allow officers to lawfully obtain information where non-compliance is an issue. But farmers disagree. They fear MPI will be able to turn up at farmers’ properties without getting a warrant and seize anything they want, unannounced and without cause. They want this wide-ranging power curtailed to prevent a NAIT officer seizing property if he/she has no warrant. Federated Farmers leaders acknowledge the feedback on social media has been huge; farmers have been emailing them to express frustration. Milne says she felt the process was rushed by using the urgency provisions. She says legislation is always better when more time is taken to find fishhooks. Which prompts the question, how much did the industry leaders know about the changes? If the Government rushed through extra changes under urgency, they may fairly be accused of misleading industry leaders. There is no doubt that changes to NAIT were necessary. As the industry grapples with the fallout of M.bovis it has become clear that some farmers haven’t been taking the requirements to record animal movements through NAIT as seriously as they should have been. Their behaviour has caused vast problems since M.bovis was first discovered. These issues needed to be fixed, but that was no excuse for the Government to hoodwink the industry by ramming through extra changes without consultation.
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DAIRY NEWS AUGUST 28, 2018
OPINION // 23
Years of doing better by the environment CHARLOTTE RUTHERFORD
THIS MONTH, Fonterra
marks the one-year anniversary of TIAKI – our sustainable dairying programme that helps farmers make their operations more environmentally compliant. In doing so we will also celebrate more than 1,000 Fonterra farmers who now have a tailored improvement plan to help address environmental risks on-farm. Achieving this wasn’t easy and while a significant amount of progress was made pre-Tiaki it often felt like we were trying push a rock uphill. We knew there had to be a better way. Let me back up. It wasn’t that long ago that we had a programme called “Supply Fonterra”. As the name suggests, it was essentially a “to-do” list for farmers if they wanted to supply Fonterra. While the programme was intended to help farmers become more sustainable on-farm, and it did achieve a great deal, it came across more like a parent telling their kid to clean up their room. While farmers made good progress between 2012 and 2016, environmental expectations were also increasing at
an exponential rate. We were adamant not to lose the momentum or progress made by our farmers in this time. Our approach had to change. We needed to listen. We asked our farmers what it was that they wanted? How did they want to be treated and perceived, not just by management but by the public and their communities? What help did they need to farm more sustainably? We also asked our farmer-facing employees what they needed to become stronger champions of sustainability. It was quickly apparent that the co-op’s management, farmers and employees had similar motivations and goals. We all wanted to produce and sell high quality milk that got the best return for our farmers. We wanted to meet the expectations of our customers and the New Zealand public. Without a doubt, we wanted to ensure a future for the dairy industry so it could be a viable option for future generations of farmers. And like anyone, we wanted to be proud and
we worked with our farmers to improve sustainability. We increased the number of our Sustainable Dairying Advisors who provide their knowledge, expertise, and services to help farmers stay ahead of regulatory requirements and rising expectations. No longer is it a “to-do” list – but instead it’s a “we-do” list.
We help farmers see how best practice can boost their bottom line through lower fertiliser costs, greater milk production or better pasture management. We tailor our services to fit our farmers’ needs, recognising that every farm, budget and region is different. It was by changing our approach in these three
ways that we have been able to have a more positive, focused and motivating conversation about sustainability with our farmers. And this is the first step to long-term, wide-spread, sustainable improvement. • Charlotte Rutherford is Fonterra’s General Manager of Sustainable Dairying
Multi Height Service Platform Fonterra has increased the number of sustainable dairying advisors. Inset: Charlotte Rutherford.
respected for the work we did. We needed to change our approach in three ways. We focused on our shared goal. We threw out the name “Supply Fonterra” and called the new programme TIAKI - a Maori word meaning to look after, to guard, to care for, keep and nurture. While the name change was minor in the grand scheme of things, it underlined the purpose of the programme and put the shared goals of the Co-op’s management, farmers and employees at the heart of the programme. Next, we changed the way we communicated with our farmers about
sustainability. Instead of focusing on the “what”, we started with the “why”. We explained that by farming sustainably we could make sure future generations of New Zealand dairy farmers could do the same. We could use evidence of the good work being done on farm to demonstrate to our neighbours, country and customers that we are all committed to doing the right thing by the environment. The resulting compliance data supports Fonterra’s Trusted Goodness brand that is estimated to deliver $15 million back to the co-op this year. By approaching it this way, we could start a two-way conversation based on our shared goals and motivations. We changed the way
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DAIRY NEWS AUGUST 28, 2018
24 // AGRIBUSINESS
Catchment-scale tool to clean waterways A NEW service from Ravensdown will meet the stated need of farmers and other rural people for catchment-scale improvement of water quality. Instead of looking at
each farm’s impact and mitigations, integrated catchment management is a holistic way to view farming’s impact on local waterways, the company says. Water will be tested by
Ravensdown’s laboratory and environmental consultants will use nutrient loss-minimising tools. “Farmers and other local community members are saying ‘the quality of our particu-
lar waterway is not good enough and we’re not going to wait for someone else to come in and improve it,’ ” said Ravensdown’s business manager environmental, Mark Fitzpatrick.
Mark Fitzpatrick, Ravensdown
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Mitigating nutrient impacts one stream or one farm at a time can be more costly and less effective, he says. “Water quality is often an accumulation of consequences affected by the choices of a variety of community members. Communities are motivated to look at catchment impacts, and our new service will provide the means for taking a bigger-picture approach and help promote good farming practice.” Ravensdown’s environmental consultants will combine information from laboratories with farm- and catchmentscale modelling. “This can then inform decisionmaking onfarm, resulting in catchmentwide environmental impact reduction,” Fitzpatrick says. Consultants will use the agricultural version
of the LUCI (land utilisation capability indicator) modelling tool jointly devised by Victoria University and Ravensdown. LUCI enables a trained consultant to show farmers the location of potential ‘hot spots’ at risk of phosphate losses. The computer model indicates the scale of possible mitigations so helps improve decisionmaking and nutrient management. The model’s complex algorithms incorporate slope, water movement, groundwater, soil map data, climate, land class and data from the Overseer nutrient management tool. “LUCI can provide insights at a farm, catchment and even national level. It is this new software that enables our consultants to look at a range of factors at a catchment level,” Fitzpatrick says.
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DAIRY NEWS AUGUST 28, 2018
AGRIBUSINESS // 25
Hitting the books helps farmer taste success DAIRY FARMING is a
hands-on industry, but Frankie Stevens discovered that understanding the theory and business practices that underpin a farm is the key to success, comments Primary ITO. Stevens worked all her life on New Zealand dairy farms as a herd manager and contract milker, but says she got new insight while studying in 2011 for Primary ITO’s Certificate in Production Management and in 2016 for its Diploma in Agribusiness Management. “It was like all the lights had come on. Getting all these results from the cows, getting it down on paper and seeing it all make sense was so enlightening. “I learned many useful things in the diploma course -- taxation, cashflows and budgets, and working out operat-
Frankie Stevens
ing profit. I enjoyed the financial side of things. “And then there was HR. I’d had an HR toolkit since 2011 and it sat on my bookshelf. “Now I know it inside and out thanks to my diploma. Whenever we need to employ people now, I have a plan I actu-
and completed a Certificate in Agriculture but her employers, fearing that more studies would interfere with her work, held her back. Many years later she resumed her studies, discovering that her passion for dairy farming and keenness to learn sped her through her diploma course in just 18 months. “I did two modules at a time. When I hear other people say the diploma is a lot of work I laugh because I was doing it twice as fast but still contract milking 350 cows with the support of my partner and raising my son.” Stevens says the diploma course covered topics like resource management and included
ally use.” Stevens did not enjoy school and struggled with dyslexia. She was forced to take over milking her parents’ herd on the West Coast at age 15 when her father was injured in a motorbike crash. At age 18 she went to Telford Rural Polytech
THIRTY FOR MORE NOW AGED 40, Frankie Stevens has her sights set on a Bachelor in AgriCommerce majoring in Farm Management which she hopes to start next year. “One day I’d like to work as a farm consultant and maybe even do a bit of tutoring myself. I love the idea of helping people acquire those great skills. “The diploma course has given me a thirst for more knowledge and
I wouldn’t have even thought about doing a degree if I hadn’t previously done the diploma. I’ve gained self-confidence in my ability as a learner.” Following her study, Stevens became a regional leader for the Dairy Women’s Network in western Bay of Plenty. Having a supportive partner and son have played a big part in her recent achievements, she says.
working out how to convert a sheep and beef farm to dairy. Risk assessment taught her how to deal with payout volatility, climate change, biosecurity, etc. Understanding financial and accounting paperwork, tax requirements and different ownership structures has added to her expertise. “Many people go into contract milking or share milking with no idea about issues like taxation, accounting, dealing with banks or how to handle staff. “So we lose a lot of people from the industry because they burn out. They don’t have knowledge to support them in their journey and ensure they’re successful. “In self-employment you need to do budgets and know if you’re actually going to make any money. “You need to know what you’re doing so as to avoid silly mistakes like not putting enough aside to cover your tax bill. I understand those issues now.” Stevens says being able to talk to farmers in a business sense is another advantage in job interviews. “I know all about how to increase profit and production, and how to decrease their expenses. Without having stud-
ied for the diploma I wouldn’t be able to have those conversations.” Primary ITO’s courses are designed for adultdirected learning and
offer a mix of hand-written notes, whiteboard sessions, class interaction and internet research. @dairy_news facebook.com/dairynews
Notice of Election - DairyNZ Board of Directors - DairyNZ Directors Remuneration Committee Invitation for 2018 candidate nominations – two positions available In October, two elections will take place for DairyNZ Incorporated – one election for one farmer-elected director for the Board of DairyNZ Incorporated and a second election for one member of the Directors Remuneration Committee. Registered levy-paying dairy farmers are invited to nominate candidates to fill these two positions. All farmers paying a levy on milksolids to DairyNZ are eligible to stand for either election. An information pack outlining desired criteria and nomination requirements for the positions can be obtained from the Returning Officer. Nominations must be received by the Returning Officer by 12noon on Friday, 14 September 2018.
Elections If more candidates than the required nominations are received, elections will be carried out by postal and internet voting using the STV (single transferable vote) voting method. Votes will be weighted by annual milksolids production. Voter packs will be posted on 1 October 2018 to all registered DairyNZ levy payers, with voting closing at 12noon on Tuesday, 30 October 2018. The DairyNZ Annual General Meeting will be held in Invercargill on Wednesday, 31 October 2018. Election results will be announced at the meeting. For further details contact the Returning Officer as below. Anthony Morton Returning Officer – DairyNZ Incorporated 0800 666 043 iro@electionz.com
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DAIRY NEWS AUGUST 28, 2018
26 // MANAGEMENT
Time to plan for PKE restrictions I WAS intrigued earlier this year when Fonterra said milk production was only down 1% -despite the wet winter/ spring, the damage done
by pugging, the very dry early summer and severe drought in Taranaki, and the mass incursion of low quality summer grasses into pastures after Christ-
mas. How could this be, I wondered, given that the pasture-harvested figures I was seeing from the farms I monitor were
showing significant drops in feed grown per hectare. Last week it all made sense when I read that record amounts of PKE
had been imported last season, despite the higher prices farmers were having to pay for it. As in the last few years, farmers used PKE
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as the ‘get out of jail card’ when the season turned against them. The variability in pasture growth over the past few years has become extreme and, rather than develop resilient farm systems that account for such variability, some farmers simply planned to ‘dial a truck’ if they felt they needed to. Some commentators have argued that the ease of feeding PKE has led to sloppy farming systems where any perceived feed pinch is fixed by adding PKE to the diet. In many cases this has led to poor pasture quality and reduced pasture harvest. Times have changed: as of September 1 this scenario will end for Fonterra suppliers, who will be penalised whenever their FEI enters the C or D range. The days of using PKE to cover poor feed planning are over as farmers won’t have the same freedom as in the past to simply plug the gaps with PKE. Farmers need to plan now to ensure they have enough feed on hand to cover any potential feed shortages the season may cause. Farmers have several options for covering the risk of not having enough feed this season. These include: 1. Get a realistic understanding of how many cows the farm can carry on home-grown feed in an average season. An example of this is as follows: assume the farm grows about 16tDM/ha/ yr of grass and maize silage. Assume also that the 475kg cows produce 420kgMS/cow. From DairyNZ’s Facts and Figures book, a cow that size doing that production will need about 5.2tDM/ cow/yr. At this, the farm needs to be stocked at about three cows/ha. 2. Allow for the ‘nonaverage’ season. Several data sets measuring long term grass growth invariably see home-grown feed yield varying by 4 -
8tDM/ha/year. Based on the numbers in the above point, a farm could be over- or under-stocked by 0.75 - 1.5 cows/ha, depending on the season. This is where stored feeds such as maize silage come into their own. The beauty of such feeds is that if you have surplus feed you don’t need to feed it. It can stay in the bunker or stack to be fed when you do need it. 3. Grow some of your own feed on land you manage, to average down the price of bought-in feed. Cost of feed has become a critical factor in profitable, resilient systems. Growing a crop of maize on paddocks that need renewing can result in a feed price of about 20c/kgDM, even when you take into account the pasture forgone from those paddocks. If bought-in maize silage costs 32c/kgDM in the stack, and if we assume the farm grows half its own maize needs, then the average cost of feed drops to about 26c/ kgDM. 4. Contact your local maize silage or maize grain supplier now to secure this season’s feed needs. Very rarely will the contract price of maize silage in the spring be higher than the price of other supplementary feed options during a summer feed shortage. It has been my experience that planning feed needs always pays off. I believe that the upcoming restrictions on PKE will ultimately result in more efficient and more resilient farms. • Ian Williams is a Pioneer forage specialist. Contact iwilliams@genetic.co.nz
DAIRY NEWS AUGUST 28, 2018
MANAGEMENT // 27
Canterbury farmer fasttracked to chairmanship NIGEL MALTHUS
A FAST track to the
top has taken Ash-Leigh Campbell, of Canterbury, into the role of national chairwoman of NZ Young Farmers. Campbell (27) was elected chair in August, just one month after being appointed to the eight-member board at the annual meeting held during this year’s Young Farmer of the Year competition in Invercargill in early July. She agrees it’s been “really quick”. Campbell is a busy woman: she’s just got a new role as technical farm manager on eight dairy farms in Ngāi Tahu Farming’s Whenua Hou (formerly Eyrewell Forest) development. She was previously Whenua Hou’s sustainability co-
ordinator. “If someone had asked me five years ago if this is what I’d be doing I probably wouldn’t have had a clue,” she said. Although she is based at the Ngāi Tahu headquarters in Christchurch, Campbell still keeps gumboots in the truck “and they get pulled out once or twice a week”. “I’m in a lovely position with a foot in the door in agribusiness and a foot in the door being out on the farm. I’m fortunate and happy with my current role. “Tuesday Wednesday Thursday I can be out on the farm and Mondays and Fridays in the office doing paperwork. I can be tagging heifers one day or helping draft springers. If they need an extra pair of hands I can get in there and help.”
who I am. We need more than just Māori in agriculture in New Zealand. We need a lot more people in the industry in the next 10, 15, 20 years,
Manuka SA – Chile TECHNICAL ASSISTANT
Manuka SA is primarily a New Zealand owned company that develops and operates dairy farms in the south of Chile. The company is committed to adopting New Zealand dairy farming techniques, and is seeking to aggressively implement a pasture based milk production strategy. In the 2018/19 season the company will milk approximately 35,000 cows across 47 dairy units. Ash-Leigh Campbell
Campbell was raised on a small lifestyle property at Greenpark, near Lincoln, which she now helps run as a Texel sheep stud with her parents. Her career in agriculture started with parttime relief milking while still at Lincoln High
STEADY HAND ON THE HELM ASH-LEIGH CAMPBELL’S intention as chair was to keep a steadying hand on the helm. “There’s been a reasonable amount of movement in the board recently so I guess I’m ensuring we have a steady hand on the ship for the next 12 months. “We’ve got a wealth of knowledge and experience on that board with Sam [Robinson] and Sharon [Angus] coming onboard in the last few months, so we’re grateful to have them, and Jason Te Brake who has just stood down from his term as chair.
from different walks of life and with different strengths, whether it’s engineering or actually working on the land or in a scientific role.”
“He’ll definitely be holding my hand for the next 12 months ensuring I get my head around what’s involved in chairing the organisation.” Campbell said a motion to extend the board term from two years to three, to take effect from next year’s annual meeting, would hopefully reduce the risk of board turnover. The board’s first big task will be to appoint a new chief executive to replace Terry Copeland who has become chief executive of Federated Farmers.
School. She went on to become a herd manager on a Dunsandel dairy farm at age 21 and has managed a drystock farm inland. Meanwhile, she has gained diplomas in agriculture and farm management and is now studying towards bachelor of commerce in agriculture at Lincoln University. “I’m a sucker for punishment: I signed up for one year of university and here I am in my fourth year. It’ll be five years by the time I’m finished.” Campbell joined Young Farmers in 2011 while working on the Dunsandel dairy farm and a friend took her along to a local club meeting. “As a fresh-eyed 21-year-old I didn’t really know what I was walking into.” However, Campbell
recognised the opportunity to get involved and soon became the treasurer of the Dunsandel club, a position she held for four years. “Over that four year period I really got the bug for Young Farmers and I haven’t looked back since,” she said. Subsequently she became the vice-chair, then chair, of the Tasman region. She was one of three inaugural winners of the NZ Young Farmers Excellence Awards in late 2016, and was a finalist in the Ahuwhenua Young Māori Dairy Farmer of the Year awards and a Whenua Kura Māori Scholarship winner. She said that as national chair of Young Farmers she did not intend to emphasise her Māori heritage. “It’s just
The Technical Assistant will be a ‘knowledge resource’ for the CEO and senior members of the Production Team, assisting them to execute the Business Plan to grow Manuka SA to 67 dairy units by 2023/24. This position is based in Chile. Reporting to the CEO, the position supports the company operations by seeking out information that can be adapted to provide profitable and sustainable growth. The applicant must ● be able to recognise excellence in pastoral dairy farming and have an understanding of farm production models and systems ● know where to source relevant information in NZ and other countries ● have a high degree of computer literacy with particular emphasis on MS Excel and Power Point ● be able to adapt to a rapidly growing business and work in a team environment ● be prepared to learn Spanish and become engaged in the local culture. ● have excellent problem-solving skills and proven ability in quantitative and qualitative analysis ● have excellent communication skills, both written and oral ● be prepared to commit for a 3 to 5 year period ● be self-motivated and preferably hold an agri-based tertiary qualification Please forward expressions of interest or CVs to: MAX KENNEDY Director, Manuka SA, Chile kennedys@xtra.co.nz Cell: 0274 973835
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DAIRY NEWS AUGUST 28, 2018
28 // MANAGEMENT
If feed’s tight, hold tight DARREN SUTTON
MANY FARMS are
struggling with wet soils making for slower growth rates and poorer utilisation. The result is lower average pasture cover (APC) than planned for. And cows have been stood off a lot so some are not in ideal condition. What can be done
to manage your way through? Hold tight to your rotation plan. It is vital that you are not tempted to use more area in a week than your spring rotation planner (SRP) allows. In wet weather stand the late calvers off on the yard or select sacrifice paddocks that can be cropped in spring. Springers can be moved to a new break on very wet afternoons/
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nights to keep them full and content, and next day you should cut back their next break if possible. The old saying ‘grass grows grass’ is true. If you let your APC drop below 1800 then you will have less leaf intercepting light; going below 1800 will mean slower growth rates than at 2000 APC. Ultimately you want to end up at your target APC soon after balance
date. For a farm stocked at 3 cows/ha and on a 21 day round length this will be about 2100 APC, so that is your target APC to aim for. The goal in August and September is to steadily feed your cows better each week to provide a rising plane of nutrition. Don’t build up your cows too soon if you know you are likely to run short of grass or supplements, and
Once-a-day milking can be a good way to reduce pasture demand. Inset: Darren Sutton
then have to cut cows intakes suddenly. Feeding supplements Different farms have different abilities to store and feed supplements. Feeding these can allow you to hold onto the correct areas each day and week and ensure that milkers are grazing no lower than 1500. Supplements need to
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be bought based on the cost of being fed out at 5% of payout -- about 30-32c/kgDM. Once a day milking (OAD) OAD milking can be a good way to reduce pasture demand, but this is not immediate. Cows take 4-6 weeks of being milked on OAD in spring to reduce their intake levels. So you may not reduce your pasture demand, but you slow the rate at which cows lose weight. Expect some relatively small milk losses on OAD, especially going past the first three weeks on OAD. One tactic can be to milk the first three weeks of calving cows on OAD, and then put these onto TAD, while starting the next three weeks of calving cows on OAD for their first three weeks, then onto TAD. After that time, reassess and decide if the first calvers and lightest R3s should stay on OAD. Milking all your colostrums on OAD provides extra valuable time and reduces metabolic issues. Just milk your newly calved cows as soon as possible after calving,
then again the next morning with all current colostrums. This will reduce mastitis cases. Pro-Gibb This can be used successfully in August and September to bring later pasture growth forward to when the real deficit exists. The cost works out at about 20c/extra DM grown (assuming a contractor applies the product). Best to apply it behind the cows 3-5 days post-grazing. Do one full round and then stop. Don’t use ProGibb instead of nitrogen; these two products used together are cumulative. Nitrogen Soil temperatures in August and September will be well above 8oC, so nitrogen should be used behind the cows. If you are very short and it has been two months since the farm had any nitrogen, you can do threequarters of the farm in one hit and then follow the cows. Take time to assess where you are pasturewise and work out a plan to overcome the deficit that suits your own farm. • Darren Sutton is LIC FarmWise consultant.
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DAIRY NEWS AUGUST 28, 2018
ANIMAL HEALTH // 29
Antibodies the key to fighting disease in newborns
Calves are born without antibodies. Inset: Olivia Sutton.
In a three-part series, veterinarian Olivia Sutton, of Vetlife Oamaru, looks at optimising future heifers during calf rearing. In this second article she looks at Failure of Passive Transfer (FPT). ANTIBODIES ARE the
body’s defence force to attack viruses and bacteria that we come in contact with. Calves are born without antibodies; it takes them four-six weeks to be able to make their own. This is when any viruses or bacteria they contact will seriously impact them because they won’t be able to quickly fight them. You will notice that most of the sickness in calves, especially scours, all happens within those first four weeks. To protect them during this time they require antibodies from their dam to enter their bloodstream. Unlike in humans, antibodies can’t cross the placenta so we need to get colostrum -- rich in antibodies if it’s good quality -- into them. This is done by these antibodies being absorbed through the intestine into the bloodstream. This sounds simple enough, but a calf’s ability for rapid absorption decreases over time, so you are racing the clock. If the calves don’t get maternal antibodies in a high-enough concentra-
tion, i.e. if they don’t passively transfer, you will have a case of ‘failure of passive transfer’ (FPT). Consequences of FPT: If 31% mortality in first three weeks is due to FPT this relationship will persist until six months If they get sick in first three months they will be three times less likely to calve >30 months vs not being treated. Other studies suggest calves that got adequate colostrum had: ■■ Decreased pre-weaning mortality ■■ Decreased post-weaning mortality ■■ Increased daily weight gain ■■ Had 50% vet costs ■■ Produced more milk in 1st and 2nd lactations. The way to prevent this is by following the 3Qs of colostrum management. To prevent your calves from having FPT we need to balance the following: Quickly By 12 hours after birth the ability to absorb antibodies has significantly dropped, and at 24 hours absorption is non-existent. We have to get colostrum in to them as fast as possible.
Quality Antibodies are highest in the first milk produced by the udder; this is the true definition of colostrum. If cows have leaked milk then those antibody levels will not be as high. Age and genetics can also be factors, but do not be fooled into thinking that heifers have poor quality colostrum; more often than not their quality is great, mostly because the more a cow produces the more dilute the antibodies in the colostrum can be. Hygiene is also important for colostrum qual-
ity. When the intestines are open for absorption of antibodies they are also more open for bacteria to get through. Also, antibodies can bind with bacteria when just sitting in the bucket, making them unavailable for absorption if your colostrum is contaminated. We are always looking for ‘gold’ looking colostrum, but it is hard to tell how good it is without testing it. The best way
to ensure quality is to practise good hygiene for colostrum collection (i.e. no mud-covered teats and dirty test buckets) and to use a Brix refractometer to test antibody levels. This simple device takes a sample of the colostrums and when you hold it up to the light it will give you a level. The level we are looking for is at least 22%. Quantity It has been common practice for some time to give each new calf 2L of colostrum, either by
tubing or by getting them to suckle on a bottle of feeder. The amount of colostrum feed should be based on how many hours from birth the calf is and the quality of the colostrum you are feeding. The general rule is 10-12% of a calf’s birth weight in the first 12 hours. I would challenge farmers to weigh some of their newborn calves; they might be a lot bigger than 20kg. A recent study by Emma Cuttance looked at the level of FPT in
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DAIRY NEWS AUGUST 28, 2018
30 // ANIMAL HEALTH
OSPRI signals changes to NAIT system THE GOVERNMENT’S
change to the National Animal Identification and
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Tracing (NAIT) Act will result in some changes to the NAIT system in
the coming weeks, says OSPRI chief executive Michelle Edge. She is referring to the NAIT Amendment Bill that allows more ‘robust’ compliance enforcement by aligning the NAIT Act 2012 with the Search and Surveillance Act 2012. The addition of the ‘other location’ definition to the act will require NAIT Ltd to change the NAIT system to enable users to create an animal movement to or from a property not registered with NAIT and without an assigned NAIT number. Edge says OSPRI appreciates the need to penalise farmers flouting the law -- including those whose location is not registered with NAIT -- but the urgency under which the Bill was passed now forces urgent changes to the system, with some inherent risks. Edge says the system changes will be made in the coming weeks. “In the meantime, we will seek to support PICAs (persons in charge of animals) inquiring about these provisions as best we can while we investigate the best options for implementing changes to the system.” She says the Government’s lack of consultation is a concern to OSPRI; other regulatory matters for improving NAIT should have come first. The NAIT review resulted in an alternative solution for mandating the recording of movements to and from unregistered locations, as follows: “A prohibition on PICAs physically sending NAIT animals to premises without a current NAIT number is introduced”. OSPRI’s view is that
introducing such an offence would be a simpler and more efficient method of managing the risks associated with disease spread. “The converse now means that NAIT will have to enable recording or data entry of various
Michelle Edge
non- registered addresses in the system, creating further potential for confusion or error. “Alternatively, NAIT can develop a mechanism for providing a temporary NAIT number issuance for an unregistered premise, requiring further investigation to confirm that NAIT animals are in fact held and there is a PICA present at the new unregistered premises. “So to enable NAIT system users to record a movement to a destination that has no NAIT number, it will require development of manual follow-up processes, increased operational workload and potential data integrity and consistency issues.” The NAIT review also considered further refinement and clarification of the definition of NAIT location and mandatory property registration, which remains to be addressed as a part of the implementation of the NAIT review recommendations that will require regulatory change.
DAIRY NEWS AUGUST 28, 2018
ANIMAL HEALTH // 31
Farmers treating calves better PETER BURKE peterb@ruralnews.co.nz
THE MINISTRY for Primary Industries (MPI) says farmers nationwide appear to be better treating bobby calves headed for slaughter. This is a response to last year’s new regulations requiring proper facilities for loading calves onto trucks, including shelter, and the rule that sick calves or those up to four days old must not be sent to the works. MPI manager of animal compliance, Peter Hyde, told Dairy News compliance this year is very good, as it was last year. He says in 2017 only six calves out of every 10,000 arriving at meat plants were defective; he reckons so far this season
the number is the same or slightly better. “Compare that with 2008 when 68 per 10,000 calves arrived in a poor state. Over the years we have seen significant improvement and we got a very big improvement in 2017 and now this year,” he says. Hyde refers to MPI’s ‘follow the bobby calf truck programme’: MPI vets and inspectors follow trucks onto dairy farms for inspection including checking the loading facility. They check the calf shelter and the calves presented for trucking. “This year we have checked trucks in Northland, Waikato, Manawatu and Southland and, yes, we’ve been pleased with the rate of compliance. So far we’ve found only one farm with no loading facility and that farmer
Farms are now required to have proper loading facilities for bobby calves.
has been ordered to stop sending calves to the meat works until he gets a loading facility. “Two farms had inadequate shelter so again they’ve been ordered to
get shelter in place and we will re-inspect.” The rules allow fines for truckers who take sick calves to the works, and now MPI is hearing of truckers leaving calves on
farms because they judge they are unfit for trucking. Hyde says farmers should take greater responsibility for their animals and not leave it
to truck drivers to decide what animals should go to the works. MPI is also closely monitoring calves arriving at saleyards and has so far issued three
TB FREE 2019 PEST KILL TALKS OPEN OSPRI IS inviting feedback on
proposed TBfree pest control operations for 2019. TBfree is aimed at eradicating bovine tuberculosis (TB) from New Zealand by 2055; key aims are TB eradication from cattle and deer by 2026 and from possums by 2040. Just over 30 herds in NZ are now infected with TB -- down from a high of 1690 infected herds in the mid-1990s. Possums are the worst, proven carriers of TB, which has now been
wiped out in populations in 3.25 million hectares since 2011. OSPRI plans and designs killing operations then reports on them. National, regional and local consultations allow people to hear about proposed kills, says chief executive Michelle Edge. The proposed national document is to inform people well in advance of the proposed 2019 TBfree pest control operations. “Individuals and organisations can submit feedback, raise ques-
tions and comments about proposed operations including any local information needs, risks or problems.” Before kills start, land occupiers and users within and adjacent to operations will also receive specific and detailed notification. The national consultation period will close on September 30. Write, phone or go online. www.ospri.co.nz/have-your-say @dairy_news facebook.com/dairynews
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infringement notices to people presenting unfit calves at sales. “The message is aimed at people who might understand that because we have 200 vets in meat plants they think they might be able to offload weak or poorer calves at saleyards. “But we are inspecting saleyards also and we’ll take action if we find non-compliance.” MPI staff have this season issued 40 infringement notices which carry an instant fine of $500. Offences have included calves being blind in both eyes, unable to walk and poor general health. Hyde says the number of such infringements is roughly the same as this time last year, but it’s much better than several years ago. @dairy_news facebook.com/dairynews
DAIRY NEWS AUGUST 28, 2018
32 // ANIMAL HEALTH
Mixed reaction to NAIT changes PETER BURKE peterb@ruralnews.co.nz
RECENT CHANGES
to the NAIT regulations have generally been welcomed by the farming industry: DairyNZ and Beef + Lamb NZ are in favour, although Federated Farmers sees them as rushed. The technical law changes are to support the current work to eradicate Mycoplasma bovis, says Biosecurity Minister Damien O’Connor. But the NAIT problems should have been fixed years ago, he says. The problems arose from farmers not registering animal movements and slack enforcement of farmer compliance in using NAIT. The changes passed under urgency in parlia-
ment align the NAIT Act search powers with the Search and Surveillance Act. They make it clear that all animal movements must be declared to NAIT, even if the new location is not registered with NAIT; and they will allow a move against any animal owner who fails to declare those movements to NAIT. O’Connor says the changes go no further than the powers that already exist under other acts, which allow government officers to lawfully obtain information where non-compliance is an issue. The new regulations also make M.bovis a notifiable organism under the Biosecurity Act 1993, requiring that people who suspect the presence of the disease in a new location must report it to
MPI. “Prompt reporting is necessary to eradicate the disease and a well-functioning NAIT is a key part of our efforts to protect our vital primary industries from pests and disease,” O’Connor said. “Farmers and industry have been asking MPI to increase compliance so that people who are not complying can be held to account.” DairyNZ says it supports the Government’s decision to make the changes under urgency. Chief executive Tim Mackle says the changes will allow for warrantless inspections of farms, clarify animal movement requirements and make it an offence not to record animal movements. “It’s become clear over the past year, as we deal with the fallout
Biosecurity Minister Damien O’Connor.
from M.bovis, that some farmers haven’t been taking the requirements to record animal movements through NAIT as seriously as they should have been. “We’ve always encouraged farmers to ensure they complete NAIT records, and the failure to do so has caused sig-
nificant problems for the sector since M.bovis was discovered in New Zealand last year.” Mackle says the changes to the Act were clearly necessary. Beef + Lamb New Zealand (B+LNZ) welcomes the Government’s passing of amendments today to improve the National
Animal Identification and Tracing Act. Dave Harrison, B+LNZ’s General Manager Policy and Advocacy, said: “Mycoplasma bovis has demonstrated that it is critical to be able to trace movements of animals between farms in the event of a biosecurity incursion and effective compliance forms an important part of that process. “The amendments today represent a good first step towards improving the NAIT system and provide greater clarity about enforcement. “Those farmers who work hard to comply with NAIT requirements have increasingly been asking for stronger penalties and compliance actions against those who put the industry at risk and this will give them confidence
that some action is being taken. “Beef + Lamb New Zealand looks forward to working with the Government on further improvements to NAIT to ensure it meets New Zealand’s biosecurity interests and the needs of farmers.” BLNZ says M.bovis shows it is critical to be able to trace movements of animals between farms in the event of a biosecurity incursion and effective compliance is the key to that. Dave Harrison, BLNZ’s general manager policy and advocacy, says the farmers who work hard to comply with NAIT rules have called for stronger penalties and compliance actions against people who put the industry at risk; they are confident in the latest moves.
PASSED WITHOUT PROPER SCRUTINY NATIONAL’S AGRICULTURE spokesman, Nathan Guy, says while some of the NAIT changes were needed, their passing under urgency has prevented proper scrutiny of them. Agriculture Minister Damien O’Connor has had months to introduce this Bill into Parliament, but instead he expanded wideranging search powers under urgency. “Ministry for Primary Industries (MPI) will be able to turn up to farmers’ properties without getting a warrant and seize anything they want, unannounced and without cause. “National asked Mr O’Connor to send the Bill to select committee during the two-week recess to allow public input and ensure there are no unintended con-
sequences for farmers, but the Minister refused. “National proposed amendments during the debate that an officer needs reasonable cause to suspect non-compliance with NAIT before entering the property. “We also proposed that these wide-ranging warrantless powers being curtailed, so a NAIT officer can’t seize property without obtaining a warrant. “Unfortunately, both of these safeguard amendments were voted down by the Government. “However, National did successfully move an amendment that requires the Minister to report to Parliament next year on how these expanded powers are being used. “We will await this review with a great deal of interest.
“National reluctantly supported the legislation to improve NAIT’s performance but remain gravely concerned about the process and invasion of farmer’s privacy.” He says Damien O’Connor had months to bring this bill into parliament, but instead has expanded wide-ranging search powers under urgency. “MPI will be able to turn up to farmers’ properties without getting a warrant and seize anything they want -- unannounced and without cause. “National asked Mr O’Connor to send the bill to select committee during the two-week recess to allow public input and ensure there were no unintended consequences for farmers, but the minister refused.”
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Guy says National proposed that these wide-ranging warrantless powers be curtailed to prevent a NAIT officer being able seize property without obtaining a warrant. “Unfortunately, both of these safeguard amendments were voted down by the Government.” Guy says National reluctantly supported the legislation to
improve NAIT’s performance but remains gravely concerned about the process and invasion of farmers’ privacy. Meanwhile Federated Farmers president Katie Milne says she felt the process was rushed by using the urgency provisions. She says legislation is always better when more time is taken to find fishhooks.
DAIRY NEWS AUGUST 28, 2018
MATING // 33
Helping to detect cows on heat THE TIME when a cow is on heat is defined as the period during which a cow will stand to be ridden by her herd mates or a bull. It occurs every 18-24 days, averaging 21 days in non-pregnant cows, and it lasts on average 14-15 hours. This time can vary from 2-30 hours. Pre-mating heat detection is an
opportunity to practise heat detection skills and gain insight into which cows should be cycling once mating starts. It is also the easiest way to identify non-cycling cows, and gain insight on whether intervention is required. It also gives the team an opportunity to practice their heat detection skills before AB starts.
Tail-painted cows on heat.
Use tail paint to identify cycling cows. Use one colour tail paint to start, then a second colour to re-paint as
ELECTRONIC HEAT DETECTION THERE ARE a variety of electronic heat detectors in cameras and activity meters. The heat detection cameras ‘read’ heat from heat mount detectors. The camera systems work with drafting systems so both need to be installed to use the product.
Activity meters are electronic transponders that detect movement, either attached to the cow’s leg or hung around their neck. They record cow movement as cows on heat typically walk more as they are restless, mounting and being mounted by other cows.
The amount of activity is compared to previous days to identify spikes in activity and ‘identify’ heat. Some brands compare cow activity to the rest of the mob on the same day. This can be adjusted for days when there might be a long walk to a back paddock.
BREED
cows cycle and need to be re-painted. Within two weeks about half the cycling cows should have been identified. At three weeks, cows with the original colour are the non-cyclers or cows that have had very weak cycles. Calculate the herd’s pre-mating cycling rate, if cycling is less than 75% of the herd by 10 days before the planned start of mating, heat detection has not been fully effective and/ or there are too many non-cyclers. At that stage it is time to consider the options to improve heat detection during AB and whether to treat noncycling cows.
Heat detection aids The best heat detection starts with careful planning, good observation and the effective use of detection aids. Being able to interpret cow behaviour and other signs is critical, as is good record keeping and training for TM the people doing heat detection. Start by reviewing the farm’s heat detection skills: does everyone know what to look for when detecting cows on heat? Then decide which combination of aids the farm will use (tail paint, heat mount detectors, activity meters and heat synchronisation). TO PAGE 38
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DAIRY NEWS AUGUST 28, 2018
34 // MATING
Trial will track calves’ growth A TRIAL is underway to measure the growth rates of Angus/Jersey beef calves from birth to finished product. Initiated by Greenlea Premier Meats, the project will track about 150 Jersey x Angus calves now being born on Zach and Laura Mounsey’s Arcadia Dairies Farm near Otorohanga. Semen from the pedigree Angus sire Matauri Crikey G244 was supplied free by Greenlea. All calves will be transferred to calf rearer Mark Bocock for rearing to 100kg and will then be finished on Whenuakite Farm (a Pamu NZ farm) before processing at a Greenlea plant and sampling for meat quality. Greenlea’s managing
director, Tony Egan, said the three-year project will give Jersey farmers insights into the potential to increase their calf cheque by breeding to proven Angus genetics. Traditionally, in breeding calves for finishing, Jersey farmers have lagged behind their Friesian colleagues. The prospect of breeding Jersey or crossbred cows to beef bulls often causes concern about calving ease, so this trial will give those farmers evidence on which to base future breeding decisions. “The trial also recognises the need for meat processors to be more aligned with their farm supply chain so they can assure customers about welfare, antibiotic usage,
exposure to GMOs, environmental stewardship, etc. “The Angus trial is a small step in understanding how this can best be achieved and will benefits all participants in the chain,” Egan said. A range of data will be collected at each stage of the calves’ growth: farmer Zach Mounsey will record birth weights, ease of calving, gestation length, etc. Growth rates and performance will be recorded by the calf rearer, Mark Bocock, and will continue when the calves move to Whenuakite for finishing using FarmIQ. Final measurements of yield, carcase characteristics and meat quality will be recorded by Greenlea
when the animal is processed. All data will be shared within the supply chain. Egan says the calves are of particular interest because of their Jersey maternal genetics. “Dairy and beef farmers will be interested in the results as they will provide a definitive perspective on whether it is possible to produce a quality meat product from Jersey cows. “We are now working with Massey University to identify a masters degree student to write the completed project as
Zach and Laura Mounsey. Inset: Tony Egan, Greenlea Meats.
a research piece,” Egan said. Paul McGill, Pamu Farm innovation manager, applauded the project. “The incentive for dairy farmers to breed the balance of the herd to beef genetics is clear for Friesian breeders but a question persists about the value of Jersey x beef calves for finishing. This project puts discipline into collecting insights
that will be welcomed by Jersey farmers everywhere. “The benefits to Pamu from the trial extend from the ability to link
the beef genetics data with Focus Genetics, as well as an improved flow of data and information from the value chain via FarmIQ,” McGill said.
2018 CALVING SPECIAL THE 2018 calving especially interests Zach and Laura Mounsey as they await the outcome of the mating of their mostly-Jersey herd to a pedigree Angus sire as part of the Greenlea Angus Project. They are 50/50 sharemilkers on Zach’s parents’ farm on the outskirts of Otorohanga. “We purchased the herd from my parents, transitioning from twice-a-day to once-a-day in December each year and averaging between 330 - 350 kgMS/cow,” Zach said. “We have access to a runoff and want to breed the balance of the herd to beef so we can carry them on. Traditionally we’d use AI for four weeks and put Jersey bulls with the herd. “The prospect to align with Greenlea Premier Meats in this trial was attractive because it enabled us to breed the cows to proven beef genetics with the reassurance that all calves are presold for rearing and finishing. “Calving is going well. The first cows have come in very quick with half the herd having calved in the first two weeks. So far so good with no assisted calvings on the AB Angus calves. The calves are coming out strong and in good shape and are exceptional drinkers.” Mounsey said the Greenlea contract, for one year, means they will likely revert to their normal pattern of four weeks of AI followed by Jersey and potentially Angus run bulls. “Like most Jersey farmers we’ll be taking a close interest in the outcome of a trial that will influence breeding decisions in the future.”
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REARING OR SELLING CALVES?
1. TAG 6
Calves must be tagged with a NAIT RFID tag before moving off-farm, or within 6 months if they are staying on farm.
MTHS
Exceptions: Calves less than 30 days old going directly to slaughter do not require a NAIT tag.
2. REGISTER 7
DAYS
Register the tagged animal’s details in the NAIT online system within 7 days of tagging or before moving off-farm. Registration activates the tags in the NAIT online system to distinguish them from those left sitting in the shed. This enables lifetime traceability of each animal. Apply the correct animal production type (dairy or beef) during registration, this determines the TB slaughter levy for the individual animal.
3. RECORD When sending or receiving calves, create and confirm the ‘movement‘ and ensure it is recorded in the NAIT online system – with an accompanying paper based ASD form – to physically move with the animals.
NAIT is an OSPRI programme
ospri.co.nz
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DAIRY NEWS AUGUST 28, 2018
MATING // 37
Cow collars fit well in shed FLEXIBLE, high-performance cow monitoring system was just what Alastair Robinson needed in his 70-bail rotary shed in Waikuku, North Canterbury, reports the supplier, Allflex. The SenseTime monitoring system is a good fit with his automation and in-shed feeding. Robinson is a fourth-generation farmer at Robinson Dairy Farm Ltd, milking 900 cows at the peak and 750 over winter. The property is home to Royal Oak Holstein Friesian stud and has been in the family for almost 100 years. Alastair Robinson has been there full time since 1993, growing the farm by buying neighbouring property and lease blocks as they came to market. And he’s had some luck. Bought chiefly for mating, the SenseTime system has been operating for four weeks and is improving heat detection and insemination accuracy. “As our mating is spread year-round the focus shifts from staff to some degree,” he says. “We also were keen to see if we could pick up sick cows sooner and have a better chance of successfully treating them.
A
“We were getting about 1-2 cows per milking that the staff had missed for mating, but this morning we had four picked up, which was great.”
“We were getting about 1-2 cows per milking that the staff had missed for mating, but this morning we had four picked up, which was great.” As the technology is new to the farm, he decided to continue with heat patches until he was confident in the technology. “With the number of cows that the collars are picking up -- over the heat patches -- I’ve got 100% confidence now”. He said the farm has hedge lines that can set off the heat patches, but the collars don’t have this problem. The technology determines true heats.
For cashflow and workload reasons, Robinson decided to fit 200 collars a month and now has 425. He started with the empty cows he is mating for autumn and the early autumn cavers he is starting to mate now. “It’s helpful and accurate so far; the collars have picked up cows the staff have missed, including one silent heat. It might have picked up one cow we didn’t necessarily agree with, but we will find out in a couple of weeks if it
was right. “We won’t see the full benefit until we’ve had them on longer, but I can easily see it saving us $20-$30/cow/ year. They’ll pay for themselves in no time I reckon.” The farm uses pedigree straws costing about $40/straw, so if cows are inseminated on a false heat the cost of wasted straws and heat patches can be a lot. Robinson and his staff have found
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the technology easy to learn, using it for present need. The collars start to produce accurate data within about 10 days of application. Robinson had organised a training session with the Centre for Dairy Excellence beyond this 10-day period. “About three days before the training, accurate data started to come through and I was able to use it easily. I don’t see myself as a tech-savvy person, so it was great to understand it before the training.” The application of the collars has also gone well. Robinson fits them himself and enters the numbers into the auto-drafter. This process is the most practical due to the non-stop season and he finds the cows are more relaxed doing it this way. They use the system twice a day after each milking by monitoring the heat graphs for specific cows. “We monitor the cow’s optimum mating window and if she is a little early we hold off inseminating until the next milking”. @dairy_news facebook.com/dairynews
DAIRY NEWS AUGUST 28, 2018
38 // MATING
Detecting cows on heat FROM PAGE 33
Tail Tail paint is an inexpensive and effective way to detect cows on heat. Correct use of tail painting can identify almost 90% of cows on heat. Tail painting helps pick up cows that are only on heat for a short time and would otherwise be missed
without a heat detection aid. How to tail paint ■■ Use commercially available specifically formulated products ■■ A strip about 60mm wide and 150mm long (2” x 6”), painted along the ridge of the backbone immediately above the tail will do
■■
■■
the job. Remove loose hair and dirt before applying tail paint. Don’t apply paint too thickly. When applying tail paint for the first time apply the paint from the tail pushing towards the cow’s back; this will lift the hair and make it easier
■■
to detect heats when the cow is ridden. A cow that is ridden will either have the paint rubbed off or have the hair pushed down and dirtied by mounting. Check the paint strip each milking. In 90% of cases, most of the paint will be rubbed off when a cow is on
heat. A further 5% of cows will lose some paint, and with the remaining 5% confusion can occur so experience in reading tail paint is needed for these cows. Paint is rarely removed by occasional mounting of cows not on heat in the yard or race.
Cows detected on heat and then inseminated should not be repainted until the following milking. Use a different colour when re-painting inseminated cows. Unmated cows are then easier to identify. ■■ Touch paint up at least weekly. ■■ Heat mount detectors ■■ There are two types of heat mount detectors: pressure-activated tubes or scratch-off patches. Applied to the cow’s backbone, the detectors will become brightly coloured and easily recognised. Heat mount detectors should be applied just before mating starts, then monitored for activation and removed at insemination. If they are damaged or coming loose they will need to be replaced. Heat mount detectors can be particularly ■■
effective on farms with staff who are less skilled at checking cows on heat since less ‘technique’ is required to apply or read them. They also reduce the time required to re-fresh tail paint. However, they are more expensive and can still provide false and missed heats. Using heat mount detectors ■■ Apply heat mount detectors according to manufacturers’ instructions. ■■ Check for other signs of heat if the detector is lost as it may indicate the cow is on heat. ■■ Consider combining heat mount detectors with tail paint. Combining two heat detection aids may reduce the risk of missed heats. • Article sourced from DairyNZ
KEEPING A CLOSE WATCH THE TIME when a cow is on heat is defined as the
period during which a cow will stand to be ridden by her herd mates or a bull. It occurs every 18-24 days, averaging 21 days in non-pregnant cows and lasts on average 14-15 hours. This time can vary from 2-30 hours. Symptoms Cows coming into heat (duration 6-10 hours): ■■ Will not stand to be ridden ■■ Smell other cows ■■ Attempt to ride other cows ■■ Display a moist, red, and slightly swollen vulva ■■ Are restless and bellow Cows in heat (duration 2-30 hours - average 15 hours): ■■ Stand to be ridden - hair and skin rubbed of crest of tail ■■ Are nervous, excitable, and restless ■■ May ride other cows ■■ May stand with back arched and tail in air ■■ Spend less time than usual grazing ■■ Display moist, red vulva ■■ Clear mucus discharge from vulva ■■ May hold milk ■■ Frequently change from their usual order coming into the shed; often lead the herd from the paddock or lag behind Cows after heat ■■ Will not stand to be ridden ■■ Smell other cows ■■ Clear mucus discharge from vulva • Article sourced from DairyNZ.
DAIRY NEWS AUGUST 28, 2018
MACHINERY & PRODUCTS // 39
Whoa boy, let’s stop safely MARK DANIEL markd@ruralnews.co.nz
GETTING TRACTORS up to speed with a combination of big engines and trick transmissions has seen machines hit 40, 50 and 60km/h. But stopping loaded trailers, with heavier operating weights, has really been a lottery, using a combination of hydraulic, air or combined systems. Problem is, the gross weight of loaded trailers often far exceeds that of the towing tractor, so the ‘tail’ starts wagging the ‘dog’. Step forward New Holland, which recently launched its solution to the
problem – the Intelligent Trailer Braking System for T6 and T7 series tractors equipped with AutoCommand
transmissions. It’s said to improve stability during deceleration when towing heavy trail-
ers or tankers. Users should see major benefits, particularly in situations where there is low friction. The factory notes that the deceleration rates of the tractor and trailer are synchronised when the operator reduces speed by using the transmission but without applying the brakes. Normally in these conditions the momentum of the trailer will cause it to bear down on the tractor and push it. This can lead to instability, perhaps a ‘jackknife’, particularly on steep gradients or surfaces such as ice or wet grass. The system uses a transmissionmounted torque sensor that senses
the tractor slowdown. Then an electronically controlled trailer brake valve automatically applies the trailer brakes to reduce the trailer’s speed to that of the tractor. The automated braking system prevents the pushing effect without any modifications to the trailer braking system. New Holland says the harmonised braking makes stopping distances equal to those of a tractor without a trailer; all the driver need do is reduce speed using the transmission. The option is offered with other braking related choices such as an enhanced exhaust brake and anti-lock braking.
EASY APP PUTS SERVICE ON MAP As Ricardo says “updating information as tasks are completed leads to much greater accuracy and easy reference”. “Try remembering if you serviced a piece of machinery three or six
EVEN THE least-mech-
anised farm has gear that benefits from regular maintenance and servicing. But keeping track of service schedules and records can be hit and miss, especially if it depends on paper systems, and it’s more complicated for arable operators or farm contractors. A new app, Farm Service Manager, designed for mobile phones or tablets, has recently been launched by New South Wales farmer David Ricardo. With 30 years experience of farming wheat, chickpeas, canola and cotton in Walgett, NSW,
months after the event.” A good system will help users ensure machines are serviced in time to ensure top performance and to make the best of resale value. The system allows
easy export of information to interested parties or prospective buyers. Available in English, with plans to introduce other languages, the app works on Apple and Android. – Mark Daniel
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DAIRY NEWS AUGUST 28, 2018
40 // MACHINERY & PRODUCTS
Don’t let wind ruin your spreader’s day MARK DANIEL markd@ruralnews.co.nz
Amazone’s WindControl system.
SPREADER MANUFACTURER
Amazone claims it can now tame the wind with its WindControl system. This automatically adjusts lateral distribution according to
wind speed and direction, so it’s ideal for spreading where wind is a regular problem. It’s available this spring for all ZA-TS mounted and ZG-TS
trailed spreaders. The new technology builds on Amazone’s recently introduced Argus Twin monitoring system that uses 14 radar sensors to monitor the spreading pattern of the left and right spreading discs; then the system automatically adjusts the spreading pattern of either disc if any deviation from the settings is detected. The technology compensates for any change in spreading pattern due to variations in fertiliser quality, during start-up, braking, travelling on slopes or if the spreading vanes are worn. WindControl uses a high frequency wind sensor to monitor wind speed and direction and transfers this information to the machine’s electronic control unit. The job computer then calculates any additional settings and automatically adjusts the spreading pattern of each disc. As an example, for side winds the disc speed to the windward side is increased and the
delivery system advanced, while at the same time the disc speed on the downwind side is reduced and the delivery system decreased. In situations where the system is unable to compensate for strong wind or frequent gusts, an alarm is sent to the operator. WindControl increases the time operators can be in the field, knowing that spreading remains precise. In operation, the wind sensor is mounted to the spreader and automatically folds in or out when the spreading discs are switched on or off. Folded out, the wind sensor protrudes above the tractor so that measurements are not disturbed by turbulence around the tractor; folded in, the wind sensor is safely positioned between tractor and spreader so that it cannot be damaged by low-hanging tree branches during transport. @dairy_news facebook.com/dairynews
Norwood gives back to communities NORWOOD IS celebrating 70 years of business by giving back to communities NZ-wide. In August each Norwood depot has been giving a day to supporting local charities and community projects in its region. The idea is to applaud people who have helped the business get to where it is today. “We want to give back to the community in meaningful ways,” said chief executive Tim Myers. “So it will be up to our individual dealerships to choose the day and way they give back. “Our teams are a part of their communities, they know them and they know what will help them the most. “We’ve decided to stagger our community days across the business for the entire month so we can still offer 24/7 customer support,” said Myers. “Farmers don’t get a day off, so it wouldn’t be helpful for us to close down nationwide for 24 hours. To see our teams get so passionate and involved with local organisations, and make plans to improve their communities, is heart-warming.” www.cbnorwood.co.nz
DAIRY NEWS AUGUST 28, 2018
MACHINERY & PRODUCTS // 41
Striking CVX heads to Mooloo land MARK DANIEL markd@ruralnews.co.nz
2017 MARKED the 175th
anniversary of Jerome Increase Case founding a farm machinery business in the US that today trades on all continents as Case IH. The company has created an anniversary model Case Puma 175 CVX tractor and is making only 175 vehicles to sell worldwide. It will be made at its factory at St Valentin, Austria. The release also celebrates a decade of Puma production at the same site. The Puma 175 CVX Jubilee Edition stands out from the crowd with its distinctive Viper Stryker
LUNA BACK TO SCRATCH ‘pearlescent’ red paint finish, first seen on the Case IH Autonomous Concept Vehicles (ACV). Powered by a 6.7L Tier 4 engine coupled to CASE IH’s continuously variable transmission, the Puma has a band of loyal followers in New Zealand
because of its high power to weight ratio. Two of the eight machines destined for the NZ market were recently handed over to the new owners at Waikato dealer Giltrap Agrizone. Blue Grass Contracting, of Te
Poi, Matamata and Schwitzer Contracting, of Cambridge got their keys from Andrew Giltrap, managing director, Giltrap Agrizone. They were also presented a commemorative plaque by Case IH manager David Self.
ANIMAL HUSBANDRY specialist Lely Dairy has introduced a new version of its Luna cow brush. Launched a decade ago, the original and enduring concept was that good animal welfare leads to happier, healthier, more productive cows. The Luna brush removes dust and dirt from the animal’s coat and skin and stimulates good blood circulation. In operation, whe a cow pushes against the brush it will start rotating in the opposite direction. It can revolve
in either direction and this is said to protect the bristles and lengthen working life. The latest model is updated with an even more durable brush element, a new electric motor with a higher IP rating for better protection against water and dust, and a new stand-alone electronic control box. A new gearbox drive consumes 40% less energy than previous versions while generating less heat. – Mark Daniel
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DAIRY NEWS AUGUST 28, 2018
42 // MACHINERY & PRODUCTS
Octavia Scout worth a look MARK DANIEL markd@ruralnews.co.nz
GIVEN THAT the Skoda Octavia won the Wagon of the Year 2017 award, it follows that the Octavia Scout has a particularly good pedigree. The designation Scout is given for higher ride height and all-wheel drive, suggesting that the wagon has just become an SUV; but in fact the Scout falls into the townie ‘crossover’ category. Based on the clever MQB platform that also underpins many VW and Audi products, the Scout has a noticeably understated look. Sure it has LED adaptive headlights and chrome detailing front and rear, buts that’s about as far as it goes. Power is delivered by a well-sorted, 4-cylinder 2.0L turbo diesel offering up to 135kW and 380Nm torque,
meaning it’s smooth and responsive, accelerates quickly from a standing start, picks up quickly at mid range speeds for overtaking and likewise from low engine revs by calling on its hefty torque. Transmission is the well-known 6-speed DSG twin clutch unit that offers swift, seamless changes whatever the method of driving. The WD system favours frontwheel drive in straightforward driving, but clever electronics brings in the rear wheels via a shaft drive connection through a multi-plate clutch pack. Out on the road, that makes for sure-footed cornering, especially in areas of poor surfaces or twists and turns. Pushing on through such territory inspires confidence, with driver and passenger comfort maintained by limited body roll and the well-sculpted seats coated in Alcantara leather.
Skoda’s Octavia Scout
Of course, being a Skoda, the Scout comes with a host of safety features for which you would dig deep in the back pocket with some other brands. Standard spec includes adaptive cruise control, front assist with pedestrian
recognition and blind spot monitoring. Add to this Skoda’s Swiss-ArmyKnife approach and you get an electric tailgate, a stack of storage including underfloor in the load area, LED flashlight and umbrella box, and you
get what this vehicle is about -- practicality. In the cabin, welcome fitments like heated seats and a heated steering wheel means you’ll be looking for the keys during the Kiwi winter. The Infotainment will keep family amused via Apple Car Play and Android Auto compatibility, and allows you to control all functions via a wide touch screen, even down to choosing the colour of the ambient lighting. As with any wagon-inspired vehicle, particularly in rural environments, it’s dual-purpose in moving people and stuff. The Scout takes five people with ease, while the rear load space offers 610L capacities with the five bodies on board. Get rid of three of the bodies and lower the rear seats and the space increases to a cavernous 1740L -plenty of room to move everything.
ALL QUIET ON THE QUAD FRONT ELECTRIC OR hybrid
vehicles are hot news, but electric farm vehicles look to be some way off. Hence our interest in an electric quad at the recent EV World Event in Auckland. The Eliminator, made by Eco Charger, has
Eliminator electric quad
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its roots in the southwest of Britain where the founder, Fred Chugg (his real name), after years working with petrolengine quads went looking for an eco-friendlier way. He used frame and transmission compo-
nents from existing quad brands, then developed adapter and mounting plates to house electric motors, batteries and micro-processor controllers to give the machine green credentials. It is powered by a 15kW permanent magnetic DC motor drawing current from a sealed AGM 72V, 100Ah battery. Its powered is reckoned at up to 30hp, its almost silent in operation, and its driveline is 90-95% efficient -- none of the inefficiencies of petrol such as noise, vibration and heat. The machine weighs a portly 490kg, a fair bit more than petrol equivalents, because its Odyssey heavy duty lead-acid batteries have the thickest plate sizes available, so contributing to cost efficiency and reliability, the maker says. Top travel speed is 40kph in two speeds and two ranges; its range on one charge is about 50km, claimed enough even for large properties. Power and torque are instantly on tap, disc brakes all-round bring things to a halt. The brakes also create a regenerative effect, with their retardation helping to re-charge the batteries.
Downhill, letting go of the throttle control creates an engine braking effect that allows safe descents of steep sections. Suspension sees twin A-arm set-ups at the front and rear, and five-way adjustable pre-load settings at the shock absorbers. Towing capacity is unstated, but the company website shows the Eliminator pulling a 7-tonne truck Switchable 2WD or 4WD is standard, with the latter using a shaft drive, full differentials and front and rear racks for functionality, while a 25A ‘intelligent’ charger keeps the battery topped up. The company says flat to full charge takes 3.5 hours from a standard 3-pin wall socket, and charge and hours data is displayed on the dashboard. A big emergency stop button is fitted in the centre of the area where you’d normally find the fuel tank. For the Australasian market Eco Charger is distributed by the SC Group, at Port Melbourne, where machines are assembled. – Mark Daniel @dairy_news facebook.com/dairynews
We are working hard to eradicate the cattle disease Mycoplasma bovis (M. bovis). Where it is found, we work closely with affected farmers to remove it from their farms and support them as they move forward. M. bovis is an animal welfare issue and has no impact on food safety or human health.
BULK MILK SURVEILLANCE PROGRAMME Another round of M. bovis bulk milk testing is taking place this spring. All dairy farms supplying milk will be tested. With the ultimate aim of eradicating M. bovis from New Zealand, this surveillance programme is essential to providing further assurance of previous non-detects. It will also help to identify any clusters of disease that could have gone undetected so far.
Facts at a glance:
RECOMMENDATIONS FOR MANAGING BULLS
• The vast majority of properties that have been tested as a result of tracking and tracing, have been cleared with no cases of M. bovis found. The total number of properties under movement restrictions (or pending restrictions) has fallen from about 350 in May to around 280 in August 2018.
The highest risk of spreading M. bovis is the movement of infected animals from one herd to another. Bulls who have been in contact with infected cows, and then moved to another herd are at risk of spreading infection.
• Since the disease was first detected in July last year, around 60 properties have been confirmed with M. bovis. Put in context, there are more than 20,000 dairy and beef farmers in New Zealand.
Bulls should arrive properly identified and with their movement history. If sourcing bulls, make sure you let the vendor or agent know that you expect these details. On arrival the bulls should be held separately from the main herd for at least seven days to assess their health, and to complete procedures such as drenching. If you have any concerns about the health of the bulls, contact your veterinarian before you mix the bulls with the herd.
All test samples will be taken as part of the normal milk collection process so farmers will not be required to do anything additional. Results will be provided to farmers in November.
The fight against M. bovis is a joint effort between MPI, DairyNZ and Beef + Lamb New Zealand; with significant support from:
Bulls leaving the farm
• Federated Farmers
One year old bulls
MPI believes mixing young animals at calf days and returning them to their home farm is not worth the risk under the current state of heightened biosecurity in New Zealand.
• 20 properties are now restocked, and another seven are in the process of restocking, after going through the process of depopulating and cleaning. Teams are working with the farmers on each property to help them recover and move forward.
• Rural Support Trust
Bulls arriving on farm – all ages
If the bulls are leased, then talk over the options with the owner.
• Dairy Companies Association of New Zealand
These bulls may be a risk for the spread of infection. The best indicator of the level of risk from these bulls is the health status of the herd the bulls have been running with.
• Rural Women NZ
Two year old (and older) bulls
This is a very stressful time for affected farmers and their families. Look out for your neighbours, friends and family and seek help if you are worried about their health or well-being.
Once mating is finished these bulls should be sent directly to slaughter. It is important that they go from the farm to the slaughter premises directly, not via saleyards or any other intermediate stopping point. If they are being held for further use (mating in autumn or spring 2019) then follow the recommendations for one year old bulls.
• New Zealand Veterinary Association • Meat Industry Association
CALF REARING Calves can become infected with M. bovis through direct contact with infected cattle, or by drinking milk from infected cows. Avoid trading milk if possible. If you have a farming operation that requires trading of calves or milk, you can take some simple steps to reduce the risk of spreading M. bovis. For more information about feeding, visit www.mpi.govt.nz/bovis.
www.mpi.govt.nz/bovis
MPB0053
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Mycoplasma bovis – latest update
If the bulls are of dairy origin, the herd has been screened via bulk milk and discard milk tests, and the results show M. bovis infection is not detected, then the risk of these bulls spreading infection is lower than those from a property where test results are unavailable. If the bulls are from a beef property and M. bovis test results are unavailable, then the best indicator of the level of risk from these bulls remains the health status of the herd(s) the bulls have been running with – pay particular attention to the herd’s levels of mastitis and lameness.
Spring is the best time to test for M. bovis because infected animals are more likely to shed the bacteria after a stressful period, such as calving and the start of lactation.
Farmers can find out more about the programme at www.mpi.govt.nz/bovis or ask your local dairy company representative.
CALF DAYS
We recommend that, while the M. bovis eradication programme is underway, schools and other groups managing calf days look for alternatives. It could become a ‘pet day’ with other pets and animals, or you could use technology and come up with an innovative compromise. Calf Club NZ has launched an ‘online calf club’, find out more and register at calfclubnz.co.nz.
BUYING STOCK The infected and most suspicious farms are in lockdown and cannot trade stock. When purchasing stock, do your homework about the original source of the cattle, their health history, and find out what milk was used when they were reared – whole milk or calf milk replacer. If you don’t like the answers, don’t buy the animals. Always apply good biosecurity measures when introducing new animals to your farm, like keeping them separate from the rest of the herd for seven days to observe their health. Always complete your NAIT records. Knowing where your cows have been is crucial to understanding and preventing the spread of disease. DairyNZ has a helpful pre-purchase checklist: www.dairynz.co.nz/pre-purchase.
For more information: www.dairynz.co.nz/mbovis www.beeflambnz.com
www.rural-support.org.nz
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