Dairy News Australia October 2016

Farm Household Allowance fail PAGE 6

TAMING THE BEAST

Panel explores dairy’s wild ride PAGE 5

SMOOTH TRANSITION

Family’s succession win PAGE 18

OCTOBER, 2016 ISSUE 74 // www.dairynewsaustralia.com.au

HEDGING YOUR BETS Could an Australian dairy futures market be the answer to reducing risk? PAGE 3

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DAIRY NEWS AUSTRALIA OCTOBER 2016

NEWS  // 3

Push for Oz dairy futures option CAMERON WILSON

Young farmer’s unwelcome visitor. PG.06

Lambie wins dairy senate inquiry. PG.14

Pinkeye season nears. PG.22

NEWS ������������������������������������������������������ 3-12 OPINION ���������������������������������������������� 14-15 MARKETS ������������������������������������������� 16-17 MANAGEMENT ��������������������������������18-19 BREEDING MANAGEMENT ����� 20-21 ANIMAL HEALTH ��������������������������������� 22 MACHINERY & PRODUCTS �������������������������������������� 23-26

THERE’S GROWING support for the establishment of a dairy futures market in Australia as tool to help farmers’ mange milk price volatility. In its basic form a futures market allows farmers to sell a portion of their future price risk to a trader that is seeking to maximize profits. Used affectively the market would allow a dairy farmer to smooth out the peaks and troughs in the milk price. Australian Dairy Farmers president David Basham put the idea of the agenda last month in a letter to members. “We believe in greater transparency and look forward to fairer contracts and exploring ways to shed risk by engaging in future markets,’’ he said. “ADF and our state members are united around a clear objective: to ensure every Australian dairy farmer has the capability, tools and support to fully understand their individual business position, and to make decisions about their future based on sound evidence and are not be always left to take all the risks in the market place chain.” Mr Basham’s comments come after the Federal Coalition committed $2 million earlier in the year to establish a milk commodity price index. While there remains limited detail around the proposed index, it is a move that could aid the establishment of a futures market. Western Victorian dairy farmer Lachie Sutherland believes it’s an option the industry should be considering. Mr Sutherland, who already utilises grain futures to manage the cost

Lachie Sutherland

of feeding his 400-head herd, said it could help him plan with more certainty. “My thoughts are that part of the price risk should be managed by the farmer rather than the cooperatives,” he said. “I think the industry needs it so that farmers can plan and make choices around what price they accept for their product. “It would allow for better planning because you would know your price, a portion of your guaranteed price.” Derivatives trading manager with Ausfine Foods, Scott Briggs, said in light of the recent milk price cuts it’s a logical time for the industry to be debating the idea, as price risk management is needed to keep Australia competitive with global peers. But he warned establishing a workable system can be challenging and as such needs widespread industry consultation and buy in. “Whenever you see a price risk issue like what we’re seeing at the moment in the dairy industry, futures look like an easy fix but it’s

not necessarily,” he said. “There is absolutely a need for dairy farmers to have price risk management tools because at the moment they just float with the market so they have no certainty. “But what we can’t do is try and just think it’s a quick fix. There is a real need to sit down as an industry and understand that this potentially benefits everybody in the industry – farmers, processors and customers. “It’s not just about farmers winning at the expense of everybody else.” But Mr Briggs said the industry should also explore more flexible supply contracts with processors as well as a futures market. “A futures market is a great idea but it doesn’t have to be the answer,” he said. “The price risk management can be embedded in the physical contract too, and maybe that is another solution that could exist for the industry. “The answer could be more of the manufacturers offering fixed

milk prices for up to three years to their farmers or farmers who want to join them.” Before a futures market could be developed the industry would first need to agree on a benchmark indicator that is tied to the milk price. While this has been done successfully in New Zealand, Europe and the US, where dairy future markets already exist, Mr Briggs said it could be a more challenging task in Australia. “In New Zealand it’s really easy because Fonterra is 85% of the market. In the US it’s a regulated milk price, it’s established by the government. Here in Australia we don’t really have a benchmark,” he said. “A lot of people will look at Murray Goulburn as a benchmark, but the variation around Murray Goulburn is huge. “For a futures market or any kind of risk management market to work in Australia we need to agree on a benchmark price.” It’s a process that is likely to take the industry a number of years. New Zealand implemented a dairy futures market earlier this year after about a decade of industry discussions and negotiations. If Australia is to go down a similar path it is expected it would take three to four years before a suitable market could be established. For Lachie Sutherland, the next step is for farmers to seriously consider if a futures market is an appealing option. “The industry now needs to gauge if there is a real true demand for farmers to try and manage some of their risk, and if there is get on and do it.” “It could make every year profitable.”

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DAIRY NEWS AUSTRALIA OCTOBER 2016

4 //  NEWS

Boutique or battle on? MADY BRENNAN

WITH THE low farm gate price weighing heavily on many farmers’ minds, OnFarm Consulting’s Matt Harms presented the panellists at the South Gippsland Dairy Expo with a curly question: does finding a niche and moving into processing of dairy products create a realistic buffer against downturns, or is it an approach riddled with risk and in danger of reaching saturation point? “We’re hearing more and more about localised production and boutique production and I think that’s great,” Mr Harms said. “But that doesn’t deal with 9 billion litres of milk. Not everyone can produce bottled milk or farm house cheese.’’ Rabobank Leongatha branch manager Russell Mann said many farmers

looked to value-add, but it was an option with extra risk and required different expertise to pull off. “I think it’s a good option if you’re good at it,’’ Mr Mann said. “It adds another string to your bow.

the business has grown and they have not been impacted by the current downturn directly – except for the opportunity to source new local suppliers. But he said their complex business model -

“I’m not seeing people saying, ‘this industry is on its knees’.”

Clockwise from left: Chris and Cameron Brown, Brown Stockfeeds; Matt Harms, Onfarm Consulting; Lucas Licciardello, Marden; Russell Mann, Rabobank Leongatha; Kylie Licciardello, Marden; Bronwyn and Burke Brandon, Prom Country Cheese; Lyn and Les Hornby, Outtrim.

– Russell Mann, Rabobank “If you can create a boutique market for yourself that’s localised, that gets you out of that somewhat, but for the majority of people we are involved in export.’’ Burke Brandon from Prom Country Cheese, who milks sheep and sources cows’ milk to make a variety of prizewinning cheeses, said value-adding was the only way their small farm remained viable. Sixteen years on,

which involves farming, processing, wholesale and retail sales as well as tourism – came with plenty of challenges. “Once you start diversifying like we have it becomes a bigger business than just what two people can farm on their own,” Mr Brandon said. “We’ve now got six staff that we need to help run the business. “That then starts getting in to a situation where you’ve got to be right into

how to run a business and all those other distractions rather than just doing what you are good at.’’ He said processing a small amount per week (2000L) kept them sustainable. “That’s not going to solve everyone’s milk volume problems,” he said. “We’ve grown into the industry, slowly over time,’’ he said. “There wasn’t really that much of a market

for what we are making 10 years ago. I wouldn’t say that there’s a massive unplugged, untapped market for what we’re doing. You’ve got create it.’’ He said the recent downturn has piqued consumer interest. “It’s given opportunities for us to talk about what we do and the products we produce and put them in the spotlight a little bit more.’’

Matt Harms said while boutique might not hold all the answers, dairy farmers were also wary of hedging their bets on a prolonged export boom. “If we were here two, three years ago, we would have seen headlines about `white gold’, and `dairy is the new frontier’, ‘we can’t get enough product into China’, that the milk price was never going to go below $6.50 (kg/MS). ‘‘Cynicism is justified

to an extent when we hear phrases like ‘it’s not going to end’ and ‘the boom’s here forever’.” Marden dairy farmer Lucas Liciardello said the recent downturn had taught him to be more focused on what he can control. “The market never lies. You can’t go against something with the blinkers on and say ‘this is going to happen’- it’ll bite you on the arse.’’

Farmers take up free business health checks NEARLY 700 dairy farmers in Vic-

toria, Tasmania, South Australia and southern NSW have registered for Dairy Australia’s Taking Stock program since May, the levy and government-funded industry body says. Taking Stock is a three-to-four hour session where a farming family and an advisor analyse the business, look for options and create an action plan for the season over the kitchen table. South-west Victorian dairy farmer, Jarrod Meade, said Taking Stock had given him a budget and identified costsavings but more importantly peace of mind in a tight 2016/17 season. “I’d say to anyone do it, it’s taken the pressure off my wife knowing that going forward we should be able to make it,”

Mr Meade said. The share-farmer milks 200 cows at Cobden and arranged the Taking Stock session with the help of WestVic Dairy, Dairy Australia’s regional development program in SW Victoria. Mr Meade decided to choose a consultant that had not analysed their operation previously to get a fresh perspective on their business. “He turned up and put all the information through Taking Stock and DairyBase on the computer and came up with the figure we needed to break even.” The Taking Stock session revealed a few areas to work on including bringing the grain price in the budget down to align with the current prices.

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Using more and higher quality fertiliser will also help in the production of more home-grown feed. Speaking at last month’s South Gippsland Dairy Expo, Marden dairy farmer Lucas Licciardello said farmers would be crazy not to take it up

“because you’ve already paid for it one way or the other’’. “It just gives you a breath of fresh air, you pull the handbrakes on and you can stop everything and have someone else come in over your shoulder, take the emotion out of it, and actually look at

the nuts and bolts of the business,’’ he said. His wife Kylie said it helped minimise the damage done by recent price shocks. “It gave us a clear view and a direction in which to go,” she said. Dairy Australia said a preliminary survey of a sample of participating farmers indicates high levels of satisfaction with the process and delivery of Taking Stock, with more than 90% of those farmers feeling confident to independently implement the action plan developed. It says demand has been consistently strong and able to be met in reasonable time, with 65% of sessions now delivered. www.tftt.dairyaustralia.com.au

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DAIRY NEWS AUSTRALIA OCTOBER 2016

NEWS  // 5

Panel tackles elephant in the room MADY BRENNAN

GIPPSLAND FARMER Les Hornby has

a good approach to making the most of the milk cheque. “I always try to get a bottle of whiskey every week,’’ he said. “I sit out on the love seat on the back verandah and I just forget about everything and look around.’’ He drew a big laugh from the audience that had filled the room to listen to the session facilitated by OnFarm Consulting’s Matt Harms at last month’s South Gippsland Dairy Expo. The topic was the ‘elephant in the room’: does dairy still have a future given the recent milk price shocks? The verdict at the end of the hour long discussion was that yes, the Australian dairy industry does have a future, but it will prove challenging at times. Solid business management skills, including making the most of the good years, and understanding the both the limits and potential of each individual business, is critical to success. Marden farmer Lucas Licciardello was frank in his approach to weathering the current storm. “Be good at what you do, have confidence in your decision making, you’ve got

to literally block out all the political bullshit, because that’s all it is. “Just concentrate on your back yard, your books, your cows, make milk,’’ he said. “It’s always happened and it probably will happen again one day. That’s just the nature of the beast; it’s agriculture.” His wife Kylie said she reflects on the good years they have had as they progressed from trainees to sharefarmers and now owner-operators. “The things we had hoped to do in the first ten years, we did in the first three, so when you look at those sort of things it reminds you that, yes this year has been really tough, and last year was really tough for us too, buying in a lot of feed, but we’ve also had some good years too, and we just need to keep remembering those years and what we’ve actually created from the industry.’’ It doesn’t mean they haven’t been extremely disheartened. “It did take our enthusiasm for a while and then you get upset because, we’re not greedy, but we do want to be able to raise our family without having to struggle, just to do what we love.’’ The couple had their first Sunday off in three months after calving down the herd on their own. They were forced to let go of staff when the price drop hit.

“I’ll be honest it is hard,” she said. “In a couple of months’ time it might be different, once we’ve had a few days off the farm. Lucky we haven’t both had bad days on the same day!’’ she joked. Rabobank Leongatha branch manager Russell Mann said despite the dire media predictions of a mass exodus from the industry, most farmers were hanging on. “We need to be reasonably sensitive to (sell offs etc) because certainly within the local region out here there are a few farms that aren’t going to be there,” he said “But I’m not seeing many. “And, I agree with Lucas that the market doesn’t lie – you look at the grain price, you look at the season we’re having, you look at the milk price on the auction results, they’ve picked up. “When they come through to the farm gate is another thing but at least you can look at those things that are fact.’’ He said most farmers were taking a long term view. “I’m not seeing people saying, ‘this industry is on its knees’. “It might be short, sharp, where we are right now, but I’m not seeing people say’ I regret being a dairy person and I want get out’, or ‘I don’t see a future going forward’. It’s very frustrating for people but they’re still in there for the longer term.’’

On Farm consultant Matt Harms played moderater and elephant tamer for the session.

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DAIRY NEWS AUSTRALIA OCTOBER 2016

6 //  NEWS

MADY BRENNAN

VICTORIAN DAIRY

farmer Ian Goodin spent more than 10 hours preparing a 100-page application for the Australian Government’s Farm Household Allowance (FHA) only to be told he is not eligible. Mr Goodin and wife Lisa are New Zealand citizens who have owned and operated their dairy business in Yarraweyah since 2008. Mr Goodin said he was told over the phone by Centrelink that he may be eligible for the FHA and should apply. But a letter confirmed he was ineligible as he was “not an Australian resident”. He said the process wasted his time and he thought it was “pretty unfair” not to be consid-

ered after eight years in Australia. “We’ve been here a while, Ian Goodin we’ve integrated into society pretty well, we’re involved with the community, on the school council, the

“You can build equity for sure and we have done, but then Murray Goulburn dropped the ball on us,” he said. “The fact they were preaching $6 (/kgMS) right up until the last days was really what got us into trouble.” Working off farm to supplement income is not

“It’s a bad situation that definitely needs changing,” – Jenni Clark, NVFRD local soccer club and all that stuff, as well as paying our taxes, but we’re not treated the same at the other end of it,” he said. Ian and his wife Lisa currently oversee four farm businesses in the region, and as suppliers to Murray Goulburn were hit hard by the recent price drop.

an option because they had to reduce staff numbers. The couple are managing by using additional borrowings, cutting costs and doing the bulk of the work themselves. He said they were grateful the season has been good so far and they won’t be purchasing water

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over summer. A spokeswoman for Centrelink said New Zealanders who arrived in Australian before 2001 were considered protected Special Category Visa Holders and met the definition of an Australian resident if they lived here. But a rule change in February 2001 meant any Kiwis arriving after 2001 are not considered Australian residents. Jenni Clark from the Northern Victoria Farmer Relief Drive is calling on NZ and non-Australian citizen dairy farmers to get in contact with her via the NVFRD Facebook page. She is collating the information to present to the government. “It’s a bad situation that definitely needs changing,” Mrs Clark said. Mr Goodin says he and his family, including sons Hunter, 12, and Luke, 10, intend to stay in Australia and will look to become citizens down the track. “My kids are raised as Aussies, they play AFL and they call jandals thongs,” he said. “I mean they love NZ too, but if they ended up playing rugby they’d be more likely to play for the Wallabies than the All Blacks.”

Jack Hayes

Surprise farm visitor delivers anti-dairy view IT WAS a normal day on the Hayes family farm at Avoca in the southern highlands of NSW. Son Jack, 18, was putting filters together in preparation for milking. His brother Harry, 14, was bringing in the cows with his grandfather. Parents Evan and Kylie were holidaying in Adelaide. When Jack saw unfamiliar car pull up near the yards, it wasn’t surprising. The farm is on a busy road, and tourists often pull in and ask to see the cows or check for directions. “A lady drove up in a Subaru. I thought she might have been lost,” Jack says. “She came and said ‘I was wondering, how do you treat your cows?” and I said ‘We treat them good, why?’. ‘I reckon dairy farmers don’t treat them right, they are forced to get milked,’ the visitor said. “And I said ‘Well, they get treated better than many humans, they get fed five times a day and they get to walk home freely’.” The woman told Jack she didn’t believe him, to which Jack replied: “Well I’ve told you what we do, and if you don’t believe me, you can go and stick a carrot up your arse!” The woman then hopped in the car and drove off. Jack’s father Evan says he’s proud of the way his son handled the situation.

“It didn’t really bother him, nothing really bothers Jack,” he says. But Evan says he’s disappointed the woman has the wrong ideas about dairy farming. “You’d prefer to have people come in and see the cows and get the right facts. And actually see how they are treated instead of rely on gossip that goes on in the media.” He’s thankful it didn’t happen to someone else. “It could have been different if the farmer had had a bad day, with the ways things are.” Evan says it hasn’t rattled the family too much, but they may purchase additional security, such as cameras, which they were considering anyway. “We don’t want to stop people coming on farm if they are curious,” Evan said. “But it does shock you a bit.” A spokeswoman for peak lobby group Australian Dairy Farmers said it encouraged farmers to open their farms to their local community, as part of their aim to be open and transparent on animal health and welfare. She said ADF has an ongoing dialogue with animal welfare groups including the RSPCA, Animals Australia, Voiceless and others. “We may have different opinions on some issues, but there are also many areas where we agree.” – Mady Brennan

ZO641427

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DAIRY NEWS AUSTRALIA OCTOBER 2016

NEWS  // 7

Cuts were ‘opportunistic’ JEANETTE SEVERS

FARMERS VOICED

their displeasure with the farm gate prices and industry strategy at the ABARES Regional Outlook Conference at Traralgon last week. “The retrospective price cuts back to July 2015, announced by Murray Goulburn and Fonterra in May this year, were ruthless, opportunistic and harmful to dairy farmers,” said Yannathan dairy farmer and past president of Australian Dairy Farmers, Noel Campbell, whose income dropped by 67%. “If we’d known earlier, we would have farmed accordingly with that knowledge in mind. It must never happen again. Responsible fiscal behaviour is paramount. “These kinds of actions can and will see the exit of young farmers, impacting on the long term strength of the industry. “Today the industry is hampered because farmers and processors lack a mature working relationship and trust.” Matt Watt, Fonterra’s general manager of milk

supply Australia, acknowledged the lack of trust had impacted across the value supply chain. Fonterra was focused on driving processing efficiencies to reduce costs and improve farm gate profits. “We acknowledge there is a loss of trust and our actions going forward need to focus on rebuilding trust. Dairy is a high trust industry across the supply value chain,” he said. “Profitability needs to be sustainable for farmers and processors and we also need to focus on strategies that will rebuild connections between farmers and consumers.” He called for transparency across the industry, as discussions continued to take place between farmers, processors, industry bodies and government and the Australian Competition and Consumer Commission undertakes its confidential investigations. The ACCC investigations should be tabled to government at the end of next year. “It’s very early days in the industry process but without transparency it’s

very difficult to review this crisis and rebuild trust. We need the impacts to be discussed and understood by everyone,” Mr Watt said. Wayne and Joan Weller, Fonterra suppliers and farmers at Longwarry, recently returned from Japan and voiced their concerns about the Australian dairy industry’s reliance on China for

export markets. “The feedback we were getting from Japanese customers was they wanted assurance of supply,” Mrs Weller said. “They fear Australia is too focused on Chinese consumers and supply will be restricted to what is already a well-established market for Australian dairy supplies.”

Dairyfarmers and Fonterra suppliers Noel Campbell and Wayne and Joan Weller, with Matt Watt, Fonterra general manager supply Australia, attended the ABARES conference and exchanged views about the lack of trust that has developed in the dairy industry this year.

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ANALYSTS estimate dairy incomes will fall even further, in presentations at the regional ABARES Outlook conference at Traralgon last week. “This (financial) year the farm gate price of dairy is expected to fall another 2% and Australian milk production will fall to a little over nine billion litres,” said ABARES analyst, Peter Collins. Murray Goulburn suppliers were expected receive lower returns at the farm gate, according to Mr Collins. But that particular situation may resolve, as his predictions are based on MG’s Milk Supply Support Package, currently under review. Other ABARES predictions were lower dairy herd numbers impacting production and export targets, as farmers culled cows to create cash flow against improved beef values. “We also expect dairy exports to fall by 1%,” Mr Collins said. But cheese exports will rise, to fill demand for a growing consumption of pizza in Asia. The ABARES analysis came a day before Rabobank’s latest dairy update which says the recovery in global dairy markets has begun and is expected to be sustained into 2017. Mr Harvey says with global dairy prices rising across the board, Australian farm gate prices were also showing signs of improvement, with major processors recently lifting their prices from the July season opening. – Jeanette Severs

®

DAIRY NEWS AUSTRALIA OCTOBER 2016

NEWS  // 9

Friends write away worries MADY BRENNAN

A GROUP of dairy

farming women from south-west Victoria are using writing as way to document their experiences and get away from the stresses of the farm. The friends of 20 years decided to form the Literary Ladies Who Lunch following the milk price drop in late April. They set each other writing ‘homework’ – short stories from the farm and family – and share their work via email. “There is a crisis at the moment and everyone deals in different ways,” co-organiser Karen McKie said. “Someone will mention a story and we can have a bit of a laugh about it because usually we can all relate to something similar happening on our

Literary Ladies Bronwyn, Jacqui, Liz, Karen and Anne Maree meeting in Colac last month. (Ros and Heather not present).

own farms.” Memories of farming in years gone by or the banter between husbands and wives in the dairy are just some of the stories explored in writing so far. “It is easy to remember the stories but a lot harder to put the thoughts into words,” she said. More serious lunch time topics included the

recent actions of Murray Goulburn and Fonterra, the impacts of financial stress and the future in dairy for their children. “It’s given us a reason to come together more regularly than we would, because this time of year the cows are all calving, it’s a busy time and we tend to usually have a bit of a lull in winter,’’ member Jacqui

Suares said. “When the weather is horrible and everything has turned to mud anyway, you’re stuck at home, that’s when you do need that sort of regular contact with your friends and people who understand what’s going on.’’ She said writing is cathartic. “Sometimes even just

being able to verbalise or express whatever your frustration is can be enough to just keep you going for the next few days or weeks. It’s one thing farmers don’t do enough, let it out. They internalise.’’ Karen said men are less likely to use groups to get away from it all. “In a way it’s the guys who miss out,” she said. “They’ll come to things the wives organise but there’s no way they’d organise something on their own, or go out to lunch at the pub.’’ The women hope the group might find some financial supporters and eventually publish their work. “It would be nice if we could make some money out of the stories, even if it was only enough for us all to go out for a dinner of fish and chips,” Karen joked.

IN BRIEF WCB announces price increase WARRNAMBOOL CHEESE and Butter (WCB) has announced a price rise for its suppliers of 12 cents/kg butterfat and 30 cents/ kg protein. The step-up takes the average milk price paid by WCB to $5/kgMS for the 2016/17 season. In announcing the increase WCB general manager Richard Wallace told farmers the global dairy market has improved since the opening price of $4.80/kgMS was announced in June. “Recently there has been signs of a slowdown in global milk production in key dairy regions and demand remains relatively stable,” Mr Wallace wrote in a letter to suppliers. “Despite these positive signs we maintain a cautious approach as there is still volatility in global markets and the Australian dollar remains strong. “Dairy commodity levels remain at low levels and it is difficult to predict the extent to which the global dairy market conditions may improve throughout the remainder of the season. “In this environment average closing prices remain difficult to predict and remain dependent on the many external factors. “We will review the milk price again in January 2017.” The payment is retrospective and will apply to milk supplied to WCB since July 1, 2016.

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DAIRY NEWS AUSTRALIA OCTOBER 2016

10 //  AROUND THE REGIONS

Western Victoria

New South Wales Jolliffe opens Henty Field Days

Simone Reynard now chairs West Vic dairy.

Passionate advocate for dairy RICK BAYNE

BORN AND raised on the Gold Coast, West Vic Dairy’s newest chair Simone Reynard wasn’t always a strong advocate for farming. “Like many city people, I had no affinity or understanding of the country,” she admits. Five years after meeting her husband Nick at university, she drove into Nick’s family farm near Curdievale in south-west Victoria with a dog in the back seat of the old Holden Commodore wagon and a baby on the way. “Nick was the only child of a dairy farming family and had been keen to come home to the farm after a few years away. It was a pretty easy choice, really.” Nearly 20 years later her understanding and appreciation of the dairy industry has turned full circle. She’s now an active part of the farm and in advocacy roles, with her role at WestVic Dairy as well as contributions to the United Dairyfarmers of Victoria, the People Policy Advocacy group for

Australian Dairy Farmers and the People Development Council for Dairy Australia. “Advocacy was a nice extension of what I’d done and it maintained my interest in people,” she said. In 1997 when Nick and Simone moved to the farm it was run by Nick’s parents John and Heather. Since then, the farm has grown nearly 50% and Nick and Simone now run the business with three staff and 530 Holstein cows. Nick was comfortable moving into farm work; Simone admits she was a novice. An Australian Institute of Management business course for farmers, a lot of mentoring from her mother-in-law in the calf shed, short courses, discussion groups and networking with successful farmers helped her to get a feel for the work. Simone joined WestVic Dairy two years ago and took on the chair’s role at one of the most challenging times in the industry’s history. She doesn’t shy away from the devastating impact the price crash

and tough seasonal conditions have had on farmers, but she remains upbeat about the long-term future. “What’s happened to our farmers is devastating and something that was completely out of their control,” she said. “Farmers are very resilient people who are used to an up and down milk price on the export market, but when something comes out of left field it’s hard to expect them to get back up and keep going. “We all had an understanding of what the milk price would do this season but then the long extended dry season and the cost of bringing in extra feed was very difficult to handle. On our farm we had to bring in a lot of hay and that has knocked around our budget.” Simone said farmers are hanging on to hope that prices will rebound in early 2017 to bring some positivity back to the industry. In her role as WestVic chair, Simone has been determined to ensure there are programs to help farmers in their time of need. “Our board has to make sure every farmer has access to exten-

sion and that the levy they pay is being used on programs they want,” she said. “We’ve had to put in a lot of strategies to help with the wellbeing of our farmers, like Taking Stock, Tactics for Tight Times and oneon-one advice. “We’re encouraging everyone to check on their neighbour.” There has been “a lot of bunkering down” this year with farmers reluctant to spend, which is having flow-on effects across regional communities. “I think the industry will contract a bit out of this and I’m not sure of the farm model going forward. I’m confident the family farm will be at the heart of our industry and look forward to West Vic playing a part in making these businesses more profitable for the long term.” Simone insists on looking on the bright side. “Most analysts still think it will be worthwhile to stay in dairy in the long-term,” she said. “We want to give our children, who are 17 and 19, the opportunity to farm if that’s what they want to do.”

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AUSTRALIAN DAIRY Farmers vice president Simone Jolliffe was invited to officially open the 53rd Henty Machinery field days last month. HMFD chairman Ross Edwards said the co-operative wanted to show support for the region’s dairy industry during a challenging time. “The dairy industry is in crisis and we at Henty appreciate the support dairy farmers and their service industries have contributed to the field days over the decades,’’ Ross Edwards said. Simone Jolliffe said supporting local businesses and communities during the industry crisis was important. “This isn’t just about trade and market but also natural resource management, people, animal health and welfare, farming systems and herd improvement space,’’ she said. Simone Jolliffe outlined her family’s long association with the field days, first coming to Henty as a young child with her grandfather. “There is always a friendly face at every corner and more often than not, friends, neighbours and associates,’’ she said. Dairy farmers travelled to Henty each year from the NSW south coast and southern highlands, Bega, northern Victoria and throughout the Murray region. “Rain, shine or mud, Henty Machinery Field Days draws the crowds regardless, and they are never disappointed.’’

ADF vice president Simone Jolliffe officially opened Henty Machinery Field Days.

Tasmania Advice for new comers or those exiting the industry DAIRYTAS IS hosting experienced Farmandco dairy

consultant Cameron Smith this month. Cameron will be delivering two short information sessions for anyone who is interested in what steps they need to take to enter or exit the dairy industry. Thu 20 Oct, Rocky Cape Tavern, 6.30–9pm, dinner provided & Fri 21 Oct, Deloraine Hotel, 11am–1.30pm, lunch provided. RSVP to DairyTas on 6432 2233 or email admin@dairytas.net.au by 19 October 2016.

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DAIRY NEWS AUSTRALIA OCTOBER 2016

AROUND THE REGIONS  // 11

South Australia Historic links stem back 168 years DAVID BASHAM

always knew his family’s farming history on the Fleurieu went back a long way, now he knows just how far. Research inspired by Port Elliot’s Legendairy Capital win has uncovered a continuous family link dating back 168 years. David, then the South Australian Dairy Association (SADA) president and now acting president of Australian Dairy Farmers (ADF), was asked to officially open Port Elliot’s dairy museum extension, which was completed with a grant from Dairy Australia’s Legendairy Capital program. “We dug into the family history and discovered we’ve been dairy farming since 1848,” David said. Dairy farming brothers William and John Basham

relocated about 12 kilometres from Hindmarsh Valley in the 1850s to a farm between Middleton and Port Elliot which the Bashams still use to run cattle and make silage. David is proud of his family’s long dairying history and the region’s ongoing connection to dairy. “They’ve done a great job pulling that history together in the museum at the Port Elliot showgrounds, including things I didn’t imagine were still in existence.” Dairy farming has been a lifelong passion for David. “I enjoy the challenges of farming and the flexibility of owning a small business, and being in control of my own destiny to a certain degree. “It gives me flexibility to do things with my family and, over a long

Western Australia Two week reprieve for Brownes’ suppliers THREE WESTERN Australian dairy farmers facing a

forced exit from the industry have been given a two week lifeline as efforts continue to find a market for their milk. The farmers’ supply contracts with Brownes expired on October 1, six months after the processor announced it would stop collecting the milk due to oversupply. Efforts to reach a new supply deal with one of the state’s other major processors have so far been unsuccessful, but negotiations will continue. Dairy Council president Michael Partridge said WAFarmers had been in talks with the State and Federal Governments and industry since the announcement by Brownes that the contracts would cease at the end of September. “We hope that the long term solution will ensure that not only will the milk from these three dairy farmers continue to be collected, but the entire WA dairy industry will benefit in the long term,” Mr Partridge said. Processor Harvey Fresh has also told five of its suppliers it will no longer collect their milk from January next year.

Sub-Tropical Focus Farm final open day HEAR FROM Andrew Wilson and Kelly Boyd of Wood-

lawn, near Lismore, on what it has been like to be under the two year spotlight as its Northern Rivers Resource Efficiency Focus Farm on October 27 from 10am - 2pm. Victorian dairy consultant Phil Shannon will present the final data analysis for the farm. Support Group members will share how they have responded on their own farms as a result of the project. Morning tea & lunch will be provided, please bring a chair. 34 Numulgi Rd, Woodlawn, NSW 2480. Contact: Marguerite White Ph: 0447 500 415 or email: mwhite@icdprojectservices.com.au

period of time, it has been very good as a business.” The main family farm at Mount Compass milks 320 mainly Holstein Friesian cows and supplies Parmalat. They also maintain a few Guernseys to continue a stud started in 1927 by David’s grandfather Bunny.

David Basham

David has no plans to slow his dairy links. “We’ve been going 168

The Basham Bros Butter Factory in Port Elliot c. 1890, which produced butter to be exported to England.

years. It’s not something I’m going to force my next generation to take on but I’d be happy if they want to.” (Source: Dairy Australia) Do you have a dairy family history story to tell? Email editor@ dairynewsaustralia. com.au

DAIRY NEWS AUSTRALIA OCTOBER 2016

12 //  AROUND THE REGIONS

1

Gippsland

3

South Gippsland’s dairy expo delivers 1.

Hunter Kirby, pictured with dad Scott, enjoyed feeding the calves in the Children’s Pavillion.

2.

Joshua, Courtney, Natasha and Mick Jinnette had a family day out.

3.

Sue Wright, Vivian Carroll, Megan Perks and Belinda Carroll were on hand to deliver health checks and advice on behalf of Gippsland Southern Health Services.

4. Burra Foods milk supply manager Peter Fort with Poowong

farmer and Burra supplier Brett Loughridge with Leongatha field services officer Reno Tomaino.

5.

Retired dairy farmer Alan Light, from Drouin, with daughter Jeanette James, Drouin West.

6.

Shane Doherty, Heath Killeen, Greg Pate from Irwin Stockfeeds, Lang Lang with Mal Rogers, Tapex Gippsland.

7.

Robin McKinnon, Leongatha, and Denis Casey, Nyora volunteered on the gate.

8.

The Ultimate Hayfeeders’ eye-catching mailboxes are also sun smart.

2

9. Kate Glassock was promoting the Udderly Awesome Dress Up Day on October 21 which will support the Need for Feed Disaster Relief program.

10. Greame and Vanessa Hill. Poowong.

4 5

6

7

10

8

9

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DAIRY NEWS AUSTRALIA OCTOBER 2016

14 //  OPINION RUMINATING

EDITORIAL

Futures option should be considered

MILKING IT... Can you identify Are you really this cow? No! saying it’s hot?

WE’RE USED to seeing faces and number plates blurred by Google to protect people’s privacy on Street View, but... cows? This bovine in Cambridge, UK (pictured), appears in all its bovine glory in one image, but Google then got over-eager in a tighter-cropped pic. The search giant blamed its technology: “We thought you were pulling the udder one when we herd the moos, but it’s clear that our automatic face-blurring technology has been overzealous. Of course, we don’t begrudge this cow its five minutes of fame.” Google is yet to apologise for its terrible puns.

MUCH of Australia may have been grappling with cold temperatures, mud and flood but the most recent analysis from the US National Oceanic and Atmospheric Administration (NOAA) has found that globally, August 2016 was the hottest August ever recorded. It makes August 2016 the 16th consecutive month which is the hottest example of that month on record. “There’s still plenty we don’t know about climate change, but virtually no mainstream scientist would argue that we’re not increasingly paying the price for our planetpolluting ways,” Prof. William Laurance of James Cook University said. Many farmers will be hoping just the right amount of that warmth hits their pasture soon.

US dogs licking their paws

EFFORTS to extend the market for dairy know no bounds, with an American company The Bear and The Rat, creating a yoghurt-based ice cream for dogs. The flavours are: Bacon Peanut Barker, Banana Peanut Barker and Pumpkin. The company says the frozen treat contains 15 million live & active probiotic cultures per pint and says the probiotics help with doggie breath, tummy troubles and overall immunity. Gives new meaning to the term Barkers’ eggs…

Advertising Brett Matthews brettm@dairynewsaustralia.com.au

Dairy News Australia is published by RNG Publishing Limited. All editorial copy and photographs are subject to copyright and may not be reproduced without prior written

Lambie backs dairy farmers

JACQUI Lambie has won a motion to have a senate inquiry into the dairy industry. “Australian rural and regional communities face losing millions of dollars and thousands of jobs if a fair, long-term solution to Australia’s dairy crisis is not found,” the independent senator for Tasmania said. Senior members of the dairy industry will be clocking up some frequent flyer points over the coming months, with inquiries by ASIC (into MG) and the ACCC (starting November), already announced. The industry’s peak body Australian Dairy Farmers said it was “quite concerned” about the range of issues the senator wished to have addressed and is “not pleased” with all the issues to be considered, but concedes it will present an opportunity to examine the issues affecting the competitiveness and future viability of dairy farming in Australia. The report of the senate inquiry is expected to be announced on February 24, 2017.

0417.440.009

EVENTS of the past six months dictate that farmers should have greater opportunity to influence their milk prices. We’ve seen what happens when milk processors take risks. The greatest damage of Murray Goulburn’s decision making over the past 18 months has occurred to those who had little say – the suppliers. Savvy business managers deserve an opportunity to increase their profit margin through the ability to utilise a potential dairy futures market. It’s not a mechanism to be entered into lightly, and it’s certainly not for everyone, but it should be an option for those who want it. In its basic form, a futures market allows farmers to sell a portion of their price risk to a trader that is seeking to maximise profits. Used effectively, futures allow a dairy farmer to smooth out the peaks and troughs in the milk price. Murray Goulburn’s recent business decisions put all their farmers at risk, and all have paid the price. A futures market would leave the decision on whether to hedge part of their supply to each farmer. Discussions between Australian Dairy Farmers and processors need to investigate the option of a futures market. This is in addition to the work already being done to create more flexible supply contracts, including embedding price risk management in the contact. It would benefit the farmer, and also the processor, as it’s already fairly easy for farmers to switch their supply to a rival when they want to. Its critical for farmers to say what they want to their state farm groups and the ADF. Processors have put them in an unenviable situation, but the industry needs fresh ideas on how to manage risk more successfully. Do farmers want to have more control of over the price they get paid for milk? With a senate inquiry and an ACCC review both in the pipeline over the coming months, now is the time to have your say.

Editor Madeleine Brennan

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editor@dairynewsaustralia.com.au Publisher Brian Hight Production Dave Ferguson Becky Williams Sub Editor Pamela Tipa Web Cameron Wilson Published by RNG Publishing Ltd Printed by Newsprinters Pty Ltd

permission of the publisher. Opinions or comments expressed within this publication are not necessarily those of the staff, management or directors of RNG Publishing Limited.

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DAIRY NEWS AUSTRALIA OCTOBER 2016

OPINION  // 15

Still a way to go on contract law reform BY BRIAN TESSMANN, QDO PRESIDENT

LAST TUESDAY (Septem-

ber 27) at Dairy Australia’s Melbourne headquarters, a follow up meeting after Deputy Prime Minister Barnaby Joyce’s Dairy Industry Symposium was underway. This meeting was chaired by Australian Dairy Farmers’ (ADF) and attended by Australian Competition and Consumers Commission’s (ACCC) rural industries commissioner Mick Keogh, Small Business Ombudsman Craig Lathem and representatives from most dairy processors, state dairy

farmer organisations, including Queensland Dairyfamers’ Organsisation (QDO). The forum was mainly focused on the issues between dairy farmers and milk processors. This involved discussion on issues such as industry codes including the currently voluntary supermarket code of conduct as well as the use of collective bargaining groups. QDO articulated that as a tool for farmers to enhance their bargaining position, the conditions imposed on these groups by government made that almost impossible to achieve. Under pressure the ACCC did offer that the right to collectively

boycott was under consideration to possibly improve their toolkit. Also discussed were the unfair contract protections the have been extended to farmers and small business. Attending farmers highlighted the measures’ failings, particularly that the maximum contract value cut-off for help made most dairy farmers ineligible. Many indicated there are issues regarding contracts with domestic processors, including exclusivity of supply as well as the offset term of the contracts, making it difficult for farmers to potentially shift processors. Domestic farmers and processors agreed that the domestic supply curve needs to be as

flat as possible. While some southern farmers are opposing seasonal variation in farm gate price, it is a necessary tool for supply in places like Queensland or Western Australia. The ACCC set out their pathway forward and its link to the Dairy Market Study which is calling for input this November. The overwhelming main issue raised by farmers from most states was the supermarket duopoly domination and generic store brands of $1 milk. It was clear to anyone in the room that the main market wrecker remains $1 milk and it has never been more vital to urgently address.

QDO says $1 litre milk is still “the main market wrecker.”

Tertiary scholarships support dairy APPLICATIONS ARE now open for the annual Gardiner Dairy Foundation Tertiary Scholarships which offer $10,000 per annum in funding to support the recipients’ university degree or TAFE course. The 2017 Gardiner Dairy Foundation Tertiary Scholarships give young people who live in Victorian dairy communities the opportunity to pursue formal studies and training to directly benefit these communities. Gardiner Dairy Foundation chief executive, Mary Harney, said the scholarship program has been operating since 2007 and has proven Mary Harney to be an effective way to support the local dairy industry. “Individuals in rural and regional communities can often be deterred from tertiary study as universities and TAFEs are predominantly based in metropolitan areas,” Ms Harney said. “Through the disbursement of scholarships, Gardiner Dairy Foundation hopes to assist students to attain qualifications that will positively impact the dairy industry and the local community.” Amber Angel, a recipient from the 2016 scholarship program, is currently completing a Bachelor in Nursing at La Trobe University in Bendigo and comes from Kerang in the state’s north-west.

“I feel privileged to have been awarded a Gardiner Dairy Foundation Tertiary Scholarship because I have been able to learn new skills and can now further my career for the benefit of my local community.

“Health services are often lacking in regional Australia and I look forward to being able to make a positive contribution back to my community,” said Ms Angel. To be eligible for the scholarship applicants must be starting their first year of full-time study at a University or TAFE in 2017, they must live in a Victorian dairy community and are required to live away from home to complete their studies. Applications are now open and must be submitted online by 5pm on Sunday, November 7, 2016. Visit www.gardinerfoundation.com.au/current-projectscommunity/#TertScholars

L A I C SPE T R O P RE NEXT ISSUE: NOVEMBER EFFLUENT & WATER MANAGEMENT In the face of tighter environmental controls and rising fertiliser costs, it pays dividends to manage effluent and water flows more tightly. The next issue of Dairy News Australia will cover best practice in this area and will profile new developments and equipment designed to turn a problem into potential profit. BOOKING DEADLINE: October 26 MATERIAL DEADLINE: November 1 | PUBLISHED: November 8 CONTACT: BRETT MATTHEWS T: 0417.440.009 E: brettm@dairynewsaustralia.com.au

DAIRY NEWS AUSTRALIA OCTOBER 2016

16 //  MARKETS

Climbing back up the hill some companies. WITH FARMERS no More than 50,000 doubt focussed on the farmers have applied to big wet across southern take taxpayers money Australia, we’ll keep our across the EU with a focus on how the dairy promise to cut output. market is behaving in the Dutch co-op background, and what FrieslandCampina is also it means for farmgate paying 6-10 euro c/kg for prices. FRESH AGENDA reductions in milk over Prior to the start of STEVE SPENCER the next six months. this season, we projected However, other factors a milk price range of are in play. get harder to come by $4.80/kgMS to $5.20/ Farmgate prices are later in the year. kgMS in southern states again on the rise and Our spot value and that still looks good will keep rising given the however did not go past based on announced recovery in EU wholesale the forecast average opening prices and step product prices in recent until the second week of ups. months. September and has held But as part of that, we With feed input costs estimated the commodity its ground since. Based on how long the remaining low, black ink value of $4.10/kgMS. may not be far off for So how are we tracking spot value sat below the many farmers. $4/kgMS mark, in order on that front? With low milk prices for our full-year forecast Based on spot prices to be met, the weekly spot for months, milk supply at the end of September was in steady decline value has to stay about (Figure 1), the weekly $4.50/kgMS for the rest of before these incentives spot commodity value the season, and obviously kick-in. reached $4.70/kgMS. With the Intervention higher if full-year prices That’s good news, system taking a lot of milk beyond our range are right? powder off the market, achievable. Yet does that mean a milk in some regions is The world market strong price rise? scarce, creating other has to keep firming if Not so fast. tensions. that higher value is to be Our spot milk value is The spot market realised. a lead-indicator of actual So what could muck up for raw milk in the achieved prices. Netherlands for example that show? It is based on spot is this week offering 40 The global picture is quotes that on our looking better for the next euro c/kg. It’s worth analysis over time lead more for some to actual prices actually increase by three to four output! months. With low milk prices for The net That means effect of how the relevant months, milk supply was these competing period that we in steady decline before influences on milk should focus on these incentives kick-in. supply will be in the current interesting. season is from The more March 2016 complex piece of the six to nine months as the through to the end of the puzzle is how EU effect of the milk supply first quarter 2017. slowdowns in Europe and processors use their milk. As you can see in the As milk supply slows, NZ combine to reduce chart (Figure 2), the spot and a massive stockpile the expected tonnages value took a long time of skim milk powder sits of product available for to climb back up the hill in warehouses around the export. towards $4/kgMS. region, processors will The EU is the most In that time, the value important of these and in seek other uses – most of the $A was virtually likely in more valuable the December quarter of unchanged – the uplift 2016 is expected to shrink cheese lines. has mostly come from Meanwhile New output by close to 3% improved prices of Zealand’s season is finely compared to last year. cheddar, skimmed milk poised. Milk output in the powder and butter as Most over the ditch are final quarter of last year shown. talking less milk over the was pretty stunning, so There’s recently been season, to help with the this is not really a major a sudden jump in spot global re-balance. cutback, and creative prices. But milk prices for the policy measures are being Between mid-August season will now easily used to achieve that and mid-September exceed NZ$5/kgMS, which result. our spot milk value – coupled with a good Not only is the jumped quickly as season which many may successive strong (Global European Commission kicking in 14 euro c/kg for enjoy – may encourage Dairy Trade) GDT more to go a little harder every kilogram of milk results pushed market to get milk flows up. cut from production, expectations higher, as Once a cash breaksome buyers came back to individual countries are even is reached, every kg also chiming in (in the the market, partly based helps restore cashflows. on fears that supplies may case of France) as are

Image: Marcus Hansson, Flickr.

Figure 1.

Figure 2.

The other better news is that Chinese demand is holding up in 2016 and may get better if signs of fading milk supply are real.

With the market moving up, some buyers that have been sitting on their hands waiting for movement may be flushed out to cover their

positions, further helping tilt the balance. The overall picture is improving nicely for the second half of this season - but for many

local producers who have made their calls on herd size, there may not be enough milk around to take advantage of the turnaround.

DAIRY NEWS AUSTRALIA OCTOBER 2016

MARKETS  // 17

Sentiment drives rebound

INTERNATIONAL DAIRY com- over the full season. Weather conditions are promodity prices have staged a remarkable recovery in recent months, as global viding some relief, though rainfall supply and demand slowly return to a has exceeded useful levels in many regions, and is impacting farm operamore balanced outlook. In a familiar pattern, sentiment has tions, fodder conservation, and causraced ahead of the fundamentals, with ing damage via flooding. The Australian domestic market price increases arriving earlier and more remains characteristically steady, rapidly than expected. With this in mind, caution is advis- though there have been some notable able, as current pricing remains vulner- changes within key categories. While total milk sales volumes have able to reverses in sentiment until the fundamentals catch up. Nonetheless, the oversupply issue that has maintained downward pressure on commodity pricing for so long looks to be receding, ith season 2011/12 only a few as New Zealand, Australia, and eks from ending, attention now (increasingly) Europe areisseeing cused milk on 2012/13 milktrack prices as farmproduction below years consider strategies for the coming ago levels. Demand is presenting a mixed ar. In some domestically-focused picture, with returning to gions, renegotiatedChina contracts incorGLOBALimpacT IMPACT growth, while other markets are gLobaL rating lower prices and reduced ‘tier JOHN DROPPERT JohN DropperT more sluggish. e’ access are undermining farmer Buyers have been more actively nfidence andproduct supplyas stability. seeking prices rise, For but in private label(increasing contracts and proany farmers infurther export-oriented grown moderately, by 1.5% resistance to increases is build-Shifts rationalisation have seen milk gions, aing. lower price outlook relative to cessor to 1,358 million litres over the 12 months to September), fullrequirecream Australia, milk adjustfresh theirwhite intake e currentInseason not the only2016/17 adds to thepro-companies milk sales have increased their share, up duction season has commenced with allenges of doing business, but seems ments and pricing to meet the chang7% in terms of volume, and 9% by value. two months of significant year-on-year contradict the positive medium term ing demands of a highly pressured retail This reflects an ongoing shift by condeclines (averaging 9%) in milk intakes. tlook of Asia-driven dairy demand marketplace. Lower contract prices and Whilst enormous variation exists sumers away from modified (reduced of alternative supply opportuniowth. between regions and processors, mar-a lack fat) milk varieties, which fell 6.7% in present challenges Dairygins Australia’s outlook volume and value.in a market with are tightindicative or negative for mosttiesboth manufacturing capacity. southern farm milkwith prices – limitedFull cream now accounts forDespite 61% of farmers, and gate combined the ongodomesthechallenges, fresh white the milkunderlying category, up from blished the recent Dairy 2012: Sit-step-these inginimpacts of the 2015/16 price 54% only three years ago. down, are likely to keep production tion and Outlook report, is for an tic market is stable, with steady per-capAs widely reported and in this column through 2016/17. ita dairy consumption a growing eningconstrained price range of $4.05-$4.40/kg The milk volume impact is expected and elsewhere, branded milk has S and a full year average price range population providing a degree of certo moderate as the season progresses regained market share from supermartween $4.50 and $4.90/kg MS. The tainty beyond the current adjustments. and the benefits of higher rainfall and kets’ private label fresh white milk catthewith seasons following 2008 port considers wider markettopicegory, branded milk salesthe volumes lower coststhe accrue, equating a 5% fall In

Dairy NewS aUSTraLia j

agribusiness

Export demand remains stron

re and summarises the many factors play; the key theme of the current sittion being that of re-balancing in the iry supply chain. In regions of Australia focused on oducing drinking milk, many farmers e a re-balancing market in the form renegotiation of supply contracts d reduced access to ‘tier one’ supply.

financial crisis and subsequent commodity price recovery, farmers in export-oriented regions have seen solid global supply growth (see chart) - with higher-cost competitors in the Northern Hemisphere amongst those expanding output as their margins increased. This season, favourable weather conditions have further enhanced milk

IMAGE: STATE FARM, FLICKR

Inner Mongolia Fuyuan Farming observed over the past five years, where “Caution is deli cheese growth has repeatedly out- Co Ltd obtained a 79% stake in Burra advisable, as Foods, while Warrnambool Cheese paced that of chilled cheese. cents/litre in March (AUD 4 incremental change in milk production (year-on-year) current pricing Growth in butter sales has slowed, and Butter raised $142 million via rights Euroshareholder cents/litre Saputo (AUD 36c/L remains vulnerable but remains notable at 3.6% in volume issue, with major Profit margins areDrinks under pres failing to dislodge Lion Dairy and terms, and 3.8% in value terms. to reverses in US, and stake. in NZ Fonterra has a As part of (and despite) a tumul- from its 10% blocking sentiment until As the returns frompayout international tuous few months, there have been a the final for the 2011 the fundamentals an active processing range of developments in the corpo- markets recover, has been cut from NZ$6.75-$ sector will once again be seeking extraMS (A rate sector. catch up.” to NZ$6.45-$6.55/kg

Fonterra has announced a further milk to capitalise on renewed export $5.04). investment of $4.3 million in its Wyn- opportunities. global dairy m The pain thatEffectively, many farmers expeyard (Tasmania) cheese plant, streamrebalancing. and theLower ongoingprices increasing by 7%, while private label fell lining of its warehousing operations, rienced last season, slow production margins, will growth prove and and the sale of its Wagga (NSW) River- challenges around by nearly 2%. significant obstacles for some in securThe apparent reversal of the long ina Fresh milk business. demand, and as this occurs w the short at least. Midfield Group’s new powder dryer ing supply – inmately term trend of increased private label seeterm a price recovery. K The capacity and inclination of pro-scene share stems from consumer responses at Penola, South Australia continues to watch on the global to the media coverage of the 2015/16 to take shape, with the group inking cessors to pass market upside through rate at which milk productio an agreement with Louis Dreyfus that in the form of higher farmgate prices to milk price step downs. slows in response to lower Cheese volumes have grown steadily will see the latter market the finished offset this will also be influenced by the impact of thesentimentcurrent financ south-east Middlerisks, flows. 201212milk production in theproduct US those inherent in a largely acrossin the US, MiddleAsia Eastand and the over the last months to April 2016, on consumer confidence, t maintain consistently higher ecois up around 4%while on 2011 forvalues the year to East driven recovery. southern Asia. increasing by 2.2%, cheese China’s economic growth, an The market is in a much better place Camperdown Dairy International nomic growth rates that support April (leap have grown by year 1%. adjusted), whilst early than this time in 2015, but downside is shelving its planned $500 million Within the cheese category, growth data suggests EU-27 milk production increased dairy consumption. How- of the Australian dollar. risks remain, andDemand nobody wants repeat integrated powder infinished sales of deli have outstripped foraexported d the surgemilk in supply has outpaced thecheese March 2012 quota yearvertically up ever, those of chilled cheese, increasing 5.6% operation, while Murray Goulburn of late 2015/16. ucts remains a positive and 2.3% on the previous year. New Zealand demand growth in the market. in terms of volume and 3.8% in terms of has reiterated plans to build a new Dairy Australia’s October 2016 Dairy This situation has seen the scales tinue to grow with the midd production is widely expected to finish nutritionals plant, originally flagged for Situation and Outlook report will be value. large12. emerging markets suc tip in favour of buyers in dairy marthis up 10% on last - a huge released on October Koroit, Victoria. Thisseason is a continuation of ayear trend

market influence given 95% of NZ milk is exported. Argentina is also enjoying solid production growth, but a significant supply gap in Brazil prevents much of this additional milk from leaving South America. Despite wider economic uncertainty, demand has remained resilient as importing countries like China and

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kets, with commodity prices retreating steadily over recent months. Butter prices are down some 30% from their 2011 peaks, whilst powder prices have lost more than 20%. Farm gate prices have subsequently been reduced in most exporting regions. The average basic farm gate price for milk in France for example, dropped 12% from 32 Euro

with changes in diet and with urbanisation - and also in co with global population grow the domestic market is supp growing population and s capita consumption. Whils market is currently a challen to be a seller, all signs indica ance will ultimately return.

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DAIRY News NEWS aUsTraLia AUSTRALIA february OCTOBER 2016 Dairy 2016

//  markets MANAGEMENT 18 //

Managing smooth transition Price slumpanot unique to dairy for the next generation

tHe world economy has veered into some difficult and dangerous waters, suggesting 2016 will be a long hard year of slow recovery in prices in global food commodity markets – MADY BRENNAN including dairy. The perfect storm has struck. ROGER HEFFERNAN Major food and oilseed commodity says he’s ready to in the cycle prices arenearly at low points fully inventories step back from with high.the It’s not just food farm he grew onother with major metal of course, oilup and his parents and sib- not seen for commodities arefive at prices lings. a decade. about WHO: “I don’t the blood On the mind demand side, China, the fresh ageNDa Heffernan family and guts it’s theeconomy paper- in the WHERE: largest growth world, sTeve speNcer work annoys has thethat brakes on. me,’’ he Candelo jokes. This year started with WHAT: little Succession success supposed break-even costs of He clearly loves production the job change in OPEC’s stance, the he’slittle been hope doingfor hiscollaboration whole and given production of crude oil for most major Michael to stop farmlife on the rolling hillsSaudi of Arabia new tensions between andhadexporters. ing after donating a kidney there has long been Historically, Candelo near Bega. Iran. to his daughter. a close correlation between crude He also doesn’t mind a sustained The outlook suggests This points to a bigger worry, that Low oil prices have combined Greg hadoil finished pricesa and the prices for major Hemisphere producers. a bit of a laugh petroleum glut,about unlessthe there is a strong builder’s Low oil prices can be a friend to dairy with sanctions to weaken the Russian the world economy will be adversely food commodities, including dairy realities of dairy –farming. surge in demand which I’ll come back apprenticeship economy, and have made a bad financial affected by the slowing of China – more and been working off farm producers. ingredients and feed grains. As Dairy News chats to to later. than the economists at the IMF and they asked Cheap fuel can lower the costs of situation far worse in Venezuela. Onhim theto demand side it makes sense hisThis son Greg in the dairy, is playing out like awhen “game The effect in these dairy markets will World Bank are currently suggesting. consider home. – weak economic activity reduces milk production, reducing equipment Roger comes to tellThe us OPEC theory” case in study. cartel coming Metal commodity prices are low Hethe moved back infor with demand fuel and can weaken some and energy costs as well as the cost of be uneven and hard to predict, as the the effluent sprinkler is dominate started a price war to dependence on oil, production costs, largely because construction activity his wife baby,markets. and fertiliser. blocked.energy market in the global thirdandfood was slogging itWhile out day the trends lines move Low crude oil prices also make government food buying activities and and industrial output in China have “I better turnsignalling her off their quarter of 2014, intent and Greg Heffernan, anddrive night inuncannily the middletogether,Roger it doesn’t mean oil biofuel production less attractive, the financial states of oil economies stalled. andincrease go have a play in the and to production pictured, worked with a Low metal commodity markets can of drought, is working potentially ensuring more feed supplies vary significantly. behindon the changes in dairy and grainto plan poop,” he says. “I’m always low-cost out competing alternate succession advisor for the future. But the developing world including harm several developed and developing renovating which helps support margins, even prices. in the shit somewhere.’’ technologies (such as shale the oil)farm and and a house. Dairy prices have slumped low due when dairy prices fall. This has certainly MENA has a number of large dairy economies, weakening investment Thankfully, Roger using corn renewable production and “Itabundant all depends on anbeen the case for Northern Hemisphere buyers that are also oil importers whose activity and trickling down to affect “I lost about 15 kilos,” to excessive supply from grass and Greg say they were soybeans. economies should benefit from lower household sentiment and discretionary andand leadership, grain prices the suppliers. able avoidfor a ‘shit Sotomuch the planet! Thishe is says. about growth, low feed attitude, spending. willingness A workshop However, low oil prices have mixed fuel and energy costs. lossorganised of a couple ofand big that buyers from theto fight’ when,painful throughprice competition short-term Post-mining-boom Australia is a Weak oil prices meanwhile also helped effects on dairy markets. global market. let go by the old fella,” he succession they to knock outplanning, rivals, and ensurebyaBega finiteCheese says. markets are start the conversation, In the developed EU and US ensure low prices for palm oil, used good example of this. Grains and oilseeds evolvedresource into a model of the dominant energy remains The US is another, with analysis notin let- economies, cheap fuel improves widely as a competitor and substitute with succession advisor due to“And well-supplied goodyou’re weather co-ownership that now choice for industry and consumers. suggesting that low oil prices are likely ting–it our all goenemy in one El hit, the Rick Moffattmost coming in toregions household budgets, freeing up a bit for dairy ingredients. major sees the 485-hectare Prices have been(1200 driven to levels So on balance – what does the to hurt rather than help that economy young one has to learn he to a number sup-to be kind more cash for dining out. Nino of tends to many Northern acres)seen operation not since split 2004, welltalkbelow doesn’t take everything, We’ve already seen US food service future hold for oil prices and the global if they stay lower longer, despite plier families. amongst brothers Roger lower costs of running SUVs and road he doesn’t become the grow strongly in 2015 soaking up more economy? The Heffernans went and David and two of their One important but odd indicator of transport fleets. boss, it becomes a mutual on to work with him onecheese and milk. The question is adult sons, Greg and Ian So dairy commodities are not alone sharing.” on-one. whether it can keep that growth rate economic conditions is the Baltic Dry (Toad). as bottom-dwellers – most hard and soft Index of shipping costs. Greg now lives in thesurging in 2016. “He talked to us as a “Succession was one of The index has long been a forward commodity prices are at historic lows, group, talked to us as indi- house he grew up in with Lower fuel costs can improve the biggest things here – his wife, two sons, and aeconomic prospects for countries indicator of the fortunes of the world for many reasons – including some that viduals, to see what this how we did it,” says Greg. fella wanted, and that fella daughter. dependent on fuel imports, lowering economy, and is now the lowest since are interrelated. “People have gotta hear The unwinding of this situation is The family bought the wanted,” Roger says. overall costs of manufacturing and its inception in 1985. it and get the ball rolling. This largely reflects the slowing the same for them as it is for dairy. farm they were leasing transport, including shipping and “He brought the partBecause it might cause Dairy demand will be stimulated across the road, and hisimproving ners in, everyone. The the affordability of dairy of trade in and out of China as it shit fights, but it gets the The Heffernan farm. transitions to a consumer-led economy with more affordable food and cousin Ian (Toad) lives imports. oldies went first, the ball rolling and works doesn’t matter, we work it here, or I’manot here, wellone.out completely. consumer goods. of eight people noware risks from trade-driven there with his family. Mums and Dads, and he Ontotal the other hand, there things out.’’ prices will eventually through. “We’re very causemilk I get someone to cover my the build-up working on theasfarm. It also reflects of luckyLow They bought Michaelfor dairy could see the picture of demand, low oil prices It was a few health production, supply will “We’ve worked it slow we’ve gotChina a familydiscourage busicouplecapacity of jobs.”with the promise “We sorteconomies of specialisein some that where it was and gave us a out, but his talent for book can harm the scares in the family that will reduce towe’ve normal through, and now ness, andtrade) they areand the stockpiles family the for two-way our own areas,”regions Roger which The (and its have hunger keeping ensures the farm bit of a map to go by.” major inoil-producing first prompted the shift, levels. got the next generation, you consider the most stable business says. “I look this, he suchconfidence just keep growing. finances remain in check. Roger says having an are also large dairyafter importers, as wouldto with Greg’s dad and uncle for next dairygenis that and Ireality hope the can have,” side David says.The sobering next stage of index succession, looks that, as aNorth gen- Africa The suggests the demand Greg is managing thethose in external advisor made it theafter Middle East, both suffering heart effectseration, may take all here of 2016 to stay and to “I get cranky him, he when of thethe time right forwill be sluggish eralknown rule, but the Russia and oilismarket for atthese bulk of the operation, but easier, as well keeping an (together as then MENA), attacks. thenfighting.” some. gets cranky at me,develop but it andkeep Rogersome and David day comes when he’s not time. to step it’s a team effort, with aVenezuela. open mind. His other uncle

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DAIRY NEWS AUSTRALIA OCTOBER 2016

MANAGEMENT  // 19

Spotlight on succession FARM SUCCESSION plan-

ning has become more complex and more important than ever, yet farming families are still largely failing to have the necessary discussions and adequately prepare for the future, a new study finds. The lack of preparation means many farmers are discovering their options are limited when it comes to retirement and the transfer of ownership and control. The report Australian Farming Families: Succession and Inheritance, released last month, is the result of a research collaboration between business advisory firm Chapman Eastway and Charles Sturt University (CSU). Key factors addressed in the report include intergenerational change in attitudes towards family business ownership and how this will affect succession planning, as well as implications of an ageing agricultural workforce and the consequences of inadequate succession and retirement planning. Sean Cortis, Chapman Eastway Principal and CEO, says some 350 farming families across the coun-

ADVICE FOR FAMILIES 1. Be proactive and start conversations early - Involve all family members in discussions. - Have regular family meetings. Succession should be viewed as an evolving process. 2. Run your business like a business - Consider housing your business into a formal legal entity like a corporation or limited liability company. - Where possible, all contribution to the business should be adequately renumerated at market rates. - Formalise financial reporting and decision-making. 3. Write it down - Draw up a family charter. - Draw up a legal partnership or operating agreement. 4. Assemble a strong team advisors in areas where you lack expertise 5. Adopt a mentality of stewardship - View the business as something to be protected and maintained for future generations. - Consider intergenerational change. (Source: Australian Farming Families: Succession and Inheritance)

in rural Australia,” Mr Cortis said. “Farming has changed significantly over the past 20 years, with younger farmers adopting new models of business ownership and displaying greater willingness to engage in discussion and formalised business planning.

try contributed to the report which highlights many critical issues farming families need to consider when developing a farm succession plan. “The major findings of the report pivot around significant social and intergenerational change

“We’re also seeing growth in the likelihood of divorce and the prevalence of non-traditional family structures.” Mr Cortis believes farm succession planning needs to move and adapt to those changes. “We find younger farmers are increasingly looking towards alternative models of business ownership, like company structures, family trusts or flexible lease arrangements. “They are questioning the relevance of traditional, often rigid ownership structures and seem to be valuing the relative advantages of newer business formats, particularly as platforms for investment, capital growth and as a way of providing ‘fairer’ treatment of children. “Additionally, there is a noticeable increase in the willingness of younger generations to engage professional consultation in the planning process.” Visit www.chapmaneastway. com.au/alerts-and-articles/ australian-farming-familiessuccession-inheritance to download the report.

Contest tests skills of top ploughmen GIPPSLAND DAIRY farmer

Brett Loughridge has taken his love of a good plough to new heights, competing in the 63rd World Ploughing Contest in York, England, last month. He came 12th in reversible class, the highest performing entrant from the southern hemisphere. The Poowong farmer, who milks 600 cows on about 1000 acres (405 ha), has participated in nine world championships in the conventional plough competition. This was his second year in the reversible section, riding his own John Deere tractor with a Kverne-

land mouldboard plough. Brett said he gets practise in when planting summer crops such and turnips, sorghum and maize, and that good on farm practices are the same in competition. Brett said he’ll be laying down some turnips as soon as the ground on his farm dries out a bit. “A good plough job is the soil is completely turned over, weed free, all the stubble and trash is buried to create a weed free seed bed without the use of chemicals. “The mouldboard plough turns it over in ribbons, so it’s judged on

straightness, uniformity and conformity of each furrow. “If you plough at home you might not do quite as neat and tidy job but the general technique is the same. “And if you do a good job with the mouldboard plough you can create a good seed bed in one pass.’’ He said the competitions were a great opportunity to travel. “There’s great friendship and cameraderie in ploughing.’’ Australia last held the World Plough Contest in Geelong in 1997.

Brett pictured at the World Ploughing Contest in York.

Virtual herding a step closer DAIRY AUSTRALIA has been successful in obtaining funding for the development of virtual herding technology. The grant will fund research into managing individual grazing animals and better matching their feeding requirements with the availability of feed. As a result of this research overall animal and pasture productivity will be improved, resulting in reduced production costs and improved farm profitability. “The high upfront cost of developing technologies like virtual herding, which will reduce the cost of production, would not be possible without the shared contribution of farmers through the research levy and the support of the Commonwealth Government, which will fund approximately two-thirds of the project,” Dairy Australia managing director Ian Halliday said. Virtual herding or fencing technology will allow farms to manage both individual and small groups of animals within a herd better and will contribute to a reduction in labour required to move and draft cattle. “This project will put Australian livestock industries at the forefront of applying advanced digital technologies,” said Mr Halliday. “Virtual fencing and herding technology has the potential to transform individual, small group and entire herd management.” By keeping animals out of sensitive areas and managing overgrazing, virtual herding will also help to improve environmental and animal welfare outcomes and give farm managers a better way to manage animal health and welfare. The research grant is made under the Commonwealth’s Rural Research and Development for Profit program and will be conducted in partnership with other RDCs, including Meat and Livestock Australia, Australian Wool International and Australian Pork Limited. Research providers and other partners for this project are Tasmanian Institute of Agriculture, CSIRO, University of Sydney, The University of Melbourne, University of New England and Agersens Pty Ltd. (Source: Dairy Australia) You can watch a video of virtual fencing at https://youtube/Td8Qhg4Ev_E or type CSIRO virtual fence into the You Tube search engine.

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DAIRY NEWS AUSTRALIA OCTOBER 2016

20 //  BREEDING MANAGEMENT

Genomics testing adds another string to the bow BREEDING NEEDS

to focus on fertility and health traits as part of an integrated approach to herd management that lasted over the cow’s lifetime. That was the message at a field day in West Gippsland recently, hosted by Livestock Improvement Corporation (LIC).

Peter Williams, ADHIS.

The approach saw the principals of Wallacedale Jerseys, at Poowong – a commercial dairy – diversify into genetics more than 20 years ago and, more recently, a few of the stud’s bulls have undergone genomics testing. Genomics is the DNAsequencing of genetic traits using a calf’s hair sample or similar. It has the potential to save money, as farmers are

able to make a decision about keeping a heifer or bull calf at three weeks of age; rather than wait three to five years. “Since becoming part of a database focussed on breeding genomics, we keep a close eye on the potential of what is being born,” principal Luke Wallace told Dairy News Australia. “We don’t specifically aim to breed bulls for AI. We’re always trying to breed an elite female for ourselves. If we get a bull calf instead and it’s identified for AI, that’s a bonus. “While we haven’t done a lot of genomic testing, any bull of interest to AI companies, they’ll genomically test them. “We’ll test more calves as the market develops and if we get time. It’s a commercial decision,” he said. The Wallaces bred Australian proven sires Marvarie and CSC Melvara, keeping a large number of daughters in the herd. Luke said he aimed

Luke Wallace, Wallacedale Jerseys.

to breed a long-lasting, profitable, functional cow of above-average production, that was good to work with, quiet, free milking and fertile. The 210 milking herd is split-calving. Artificial insemination (AI) and embryo transfer (ET) were used to propagate progeny. “It’s a waste of genetics to use mop-up dairy bulls when AI’ing,” Luke said. “We also do a lot of ET – recipient cows are

held for embryos. While conception rates are lower than average, that’s made up for with split calving. “It’s better to get more good calves out of the top five cows rather than the bottom 50.” Emphasis is on feeding the herd and bull selection. The entire commercial herd is registered and classified with Jersey Australia. “We focus on A2 Jersey bulls, udder depth,

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stature and chest breadth; and longevity in cows. We breed for solid cows rather than big cows in our herd,” Luke said. Reasons for culling included slow milkers and poor temperament. Testing the genomics of bulls also paid off with the ability to sell sires. “We sell 30 bulls privately each year – it’s a good revenue stream. Genomic testing has the potential to give people greater confidence when they’re buying stud stock,” Luke said. The business also sells up to half-a-dozen elite females at International Dairy Week and other multi-vendor sales each year. It is a strategy that has helped pay for the costs of AI and flushing embryos. Using genomics enabled the industry to dial-up traits to make it easier for bull selection, Peter Williams, of the Australian Dairy Herd Improvement Scheme (ADHIS), told field day participants. It is also important to have real-time local data on overseas bulls. “That’s where genomic testing will help. Bulls get tested young and we can’t rely on overseas data – it takes so long to prove a bull – with genomic testing we’re now screening them here before they produce semen,” he said. “Wallacedale Jerseys was one of the first to be involved in genomic testing and contributed

a lot of animals to the reference library – in excess of 40 traits can be identified. “A bull has to have a high tick for his home country and for Australia. His genotype needs to be able to perform statistically in Australia.” Peter said local data helped take risk out of the system. That included integrating databases and assessing and recording cow health and performance, to enable lifetime traceability. “Cows are being selected more for functionality and less reliance on ‘pretty’, because they’re easier to manage and adopt more efficient feed utilisation – eating the same amount of grass and producing more milk – and there’s less vet costs. It all adds up to profit,” Peter said. “The big use of genomics is, it enables prediction at calf stage, testing at a very young age of two to three weeks old. It costs a farmer at least $1500 to get a heifer from calf pen into the dairy shed. “With a bull, it is an even longer and more expensive process without using genomics, as you’re waiting until he’s five years old to identify traits in his progeny. “Improving the odds of predicting good traits and production value in the heifer will save the dairy farmer a lot of money and ensure an animal that will last multiple lactations.”

DAIRY NEWS AUSTRALIA OCTOBER 2016

BREEDING MANAGEMENT  // 21

New database set to improve rate of genetic gain JEANETTE SEVERS

A NEW database being

developed by Dairy Australia will integrate herd testing, farm management, animal health and numerous other software. Data Gene is set for release in autumn 2017. The man leading its development is Matt Schaffer, at Dairy Australia. “The new program will combine genetic valuation data from multiple sources, with a clear line

of site from research to on-farm application. ‘’It’s been designed to improve the rate of genetic gain in Australia,” Matt told Dairy News Australia. “You enter your information once and all your software applications can use it.” Combining herd health and production data will enable positive traits and red flags to be more readily identified on individual farms, in districts and according to seasons. Matt gave the example

of mastitis. “A vet might identify a spike in mastitis in a particular cow, a herd, a district or against seasonal affects,” he said. The number of performance measures has grown in recent years, aiming to reduce risk when selecting breeding families and building profit into the dairy farm business. Those performance measures are now able to be integrated using farm software, such as Easy Dairy, Dairy Data, from

veterinary health programs, from herd testing and from dairy equipment manufacturers such as Lely. Peter Williams from the Australian Dairy Herd Improvement Scheme (ADHIS) said Data Gene would be available nationally. “One cow could be spread across six different databases, including feed, breeding, vet care – that will be centralised through Dairy Australia.” Restrictions about access will be built into

the system, and each farmer can choose who can access their herd and farm management data. “The information is not open access – allowing it to be shared has to be on the farmer’s authority, to a designated individual. Permissions have to be sought and given,” he said. Peter said breeding programs have flourished in countries where the similar integrated database have been adopted. “Particularly in health traits – the hard-tocatch traits – like low cell

counts, better fertility and a cow’s robustness or resistance to disease,” he said. Identifying more profitable cows increased the profit margin between milk production and cost of the cow. “Data Gene will enable farmers to be more efficient and has the potential to do things we haven’t even thought of yet – it is and will be driven by farmers’ input.”

Matt Shaffer

Master Holstein breeders awarded in Albury RENGAW GOLDBULLION Janea ET EX-91-6E, was crowned Cow of the Year at the Holstein Australia annual awards dinner in Albury last month, topping off an impressive string of achievements for her breeder George Wagner from Tasmania. George’s Rengaw herd has maintained its position as Australia’s top herd based on all three breeding indices – Balanced Performance (BPI), Health Weighted (HWI) and Type Weighted) – as well as producing four of the country’s current top bulls: Geemcee, Wrangler, Challenger and Janek. Industry judge, Geoff Wood from WWS, said Janea stood out for exceptional milk production which is high in protein and fat, combined with poten-

tial influence on the Holstein breed, as the grand dam of the four elite bulls. “The Cow of the Year is not easily achieved. It requires a cow to excel in everything, not just one area. And this year we had two close contenders, with Leader Durham Satin, EX-91-5E, owned by Dean and Melissa Deans of Oakey, Qld coming a close second,” Geoff said. At 14 years old, Janea has produced more than 105,000L of milk across eight lactations, including more than 12,000L in her best lactation to date. Over the years she has accrued a host of Holstein Australia production awards including Gold Lifetime Production, Silver Superior Total Performance and three production awards. George Wagner describes her as a George Wagner from Tasmania, owner and breeder of the 2016 Cow of the Year Rengaw Goldbullion Janea ET EX-91-6E with his daughter and son-in-law, Courtney and Jared Ireland (Redmaw), from Lockington Vic, where the cow now resides.

2016 Master Breeders Back: Andrew Green, Ray Green, Zac Green, Patrick Muller, Jeanette Muller, John Bevan, Don Leslie Front: Lorraine Green, Cathy Chesworth, Lloyd Chesworth, Norma Leslie.

great old cow that has paid her way. “She’s from a top cow family but she’s exceeded all expectations. Her female progeny continue to be top producers and her male progeny will influence the Australian dairy industry for years to come,” George said. The prestigious competition recognises all-round excellence in production, classification, breeding and overall contribution to the Australian Holstein breed, selected

by invited industry judge Geoff Wood, WWS, member judge Kerri Gallagher (Galcrest, Western Victoria) and Holstein Australia’s Breed Development and Conformation Committee. Meanwhile, Dean and Di Malcolm, Bluechip Holsteins from Zeerust, Victoria dominated this year’s All Australian competition, taking out both the coveted awards, Premier Breeder and Premier Exhibitor.

The Semex/Holstein Australia All Australian is a national photographic competition that recognises excellence in conformation and showing in Holstein females that have been successful at nominated qualifying shows throughout Australia each year. The Premier Breeder and Premier Exhibitor awards are based on points allocated to each finalist, honourable mention, reserve and winners in each category.

DAIRY NEWS AUSTRALIA OCTOBER 2016

22 //  ANIMAL HEALTH

Pinkeye more likely as weather warms PINKEYE SEEN in

cattle is Infectious Bovine Keratoconjunctivitis, or IBK. The primary bacterium responsible for IBK is Moraxella bovis but more recently other pathogens have also been implicated.

For clinical signs to develop, the bacteria first need to bind to the surface of the eye (the cornea) before releasing a cell toxin which causes “punch-like” holes to form in the corneal surface. There are a number of

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contributing factors for Pinkeye which can lead to “outbreaks” on some farms. Anything causing irritation of the eye and damage to the corneal surface creates a favourable environment for Moraxella bovis. Ultra-violet (UV) radiation is a significant risk factor and helps explain why pinkeye is more common in the summer months. At this time other factors such as dust, pollen and seeds are also increased, causing mechanical irritation to the eye and subsequent corneal damage. Nuisance flies peak in the summer months and promote the spread of infection between animals. White-faced cattle or those with protruding unpigmented third eyelids are more prone to Pinkeye infection. Some previously infected animals become ‘carriers’ in the herd, shedding the bacteria in their tears from season to season and allowing spread of infection to susceptible individuals. Pinkeye tends to be more common in young stock, affecting up to 80% of some herds. The disease is very painful and can cause blindness which is temporary in most cases. Severely affected animals may have permanent loss of sight. There are economic losses associated with decreased feed intake, poor growth rates, reduced production in lactating cows and potentially reduced value at market. Untreated Pinkeye can also become a welfare concern. Initially there may only be wetting of the face due to excessive tear production from the affected eye. This may be on one or both sides, from the affected eye down the animal’s cheek. The eyelids will be closed; the animal may blink excessively and/or seek shade to avoid sunlight. As the disease pro-

APIAM ANIMAL HEALTH GEMMA CHUCK gresses, the surface of the eye becomes cloudy in the centre, often followed by formation of yellow pus surrounded by a characteristic pink ring. Ulceration of the cornea is common and in severe cases the eyeball may protrude and change shape. Early and prompt treatment results in the most favourable outcome. Topical antibiotics are required in most cases to enable a prompt recovery with minimal pain. In some cases an antibiotic is injected into the conjunctiva of the eye by a veterinarian and a course of injectable antibiotics may be prescribed. Eyepatches to cover the affected eye are useful to avoid sunlight during recovery. In extreme nonresponsive cases, surgery may be required to remove the damaged eyeball. Fly control is essential to help reduce the spread of infection and pour-on products registered for use in dairy animals can be used. It is important to always read the label carefully and check for any withholding periods. Avoidance of dusty paddocks with long grass, paddocks near bushland and excessive yarding in dry, dusty conditions will help decrease the risk of Pinkeye. Early identification, prompt treatment and segregation of affected animals will help limit the spread of infection within the herd. There is one registered vaccine for the prevention of Pinkeye in Australia (Piliguard, Coopers). This is a single dose vaccine and needs to be given three to six weeks prior to the onset of the Pinkeye ‘season’.

DAIRY NEWS AUSTRALIA OCTOBER 2016

MACHINERY & PRODUCTS  // 23

Elmore shines despite the rain MARK DANIEL

ONE THING’S for

sure, the recent rush of inclement weather in Central Victoria wasn’t going to faze the organisers of the Elmore Field days, just up the road from Bendigo. Now in its 53rd year the event has only been cancelled once, and is firmly planted in the annual round of events that serve to showcase the latest ag technology, good practice and a day out for lifestylers and recreational visitors alike.

attendances of about 42,000 visitors over the three days, those same volunteers are kept busy getting cars into, and indeed, out of carparks, manning the gates and of course feeding the hungry. For the 2016 event, the weather made sure that smart visitors packed a Drizabone and some gumboots, whilst the less prepared, including this Dairy News team over from New Zealand, added to the Australian economy with a whistle-stop tour of the local Bunnings hardware depot to buy some suitable footwear.

ever growing releases of products from India, Korea and China. For those looking for a new steed, offerings

ranged from about 20hp right up to the likes of the 600hp tracked Case IH Quadtrac, while those TO PAGE 24

Anthony Darvenezia, PFG Australia.

HARD WORKING. EASY TO OWN.

For those looking for a new steed, offerings ranged from about 20hp right up to the likes of the 600hp tracked Case IH Quadtrac. Attracting around 750 exhibitors to the 32ha central area, part of the overall 129ha site, a network of roads ensured that the 2016 event could be run despite the heavy rainfall in the days leading up to the event. Run by an army of local volunteers ranging from farmers, retirees and even the local catholic school principal, the event also serves as a lynch pin for the surrounding communities, who rally to bring the showcase together. Distributions to local community organisations from the event run to the tune of $3 million over the 53 year period. With typical

In the fashion stakes full “wet-gear” was the go, although those who hadn’t thought ahead made the best of what was available, including plastic bags. Whilst a little “fluid’ underfoot on the sites, organisers and exhibitors had made good use of woodchip and rice straw to soak up the moisture, but unfortunately the ground conditions meant that the working demos had to be cancelled, but there was much for those with “heavy metal disease” to see around the site. As well as offerings from the multi-nationals such as Deere, CNH and AGCO, the smaller marquees were well represented, as was the

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DAIRY NEWS AUSTRALIA OCTOBER 2016

24 //  MACHINERY & PRODUCTS

Elmore shines despite the rain FROM PAGE 23

looking for a bargain would struggle to pass the YTO stand, where a 125hp tractor/ loader combo with cabin, and a six cylinder motor could be had for $50k on the day. On the machinery front, a large contingent of Kiwi companies had chosen to support the event with the likes of Giltrap, Buckton, McIntosh and Duncan Ag. showing off their products which were targeted largely at livestock producers and smaller cropping framers, but as always were well received by the Aussie hosts. Walking the machinery lines gives an insight into the breadth of the Australian agricultural scene, with the high value items such as headers and tractors, being shown

L to R Max Williams, life governor; Sharron Andre, centre manager; Ivan McKenzie, life governor.

alongside high-tech items such as hay steamers, super-big items like wide cultivators and drilling rigs for broad acre, and the other end of the spectrum being covered by useful attachments to make mundane daily tasks just that bit easier. Whether it was a highlift, assisted lift system for

that heavy and awkward UTE lid, or a modular storage system for ATVs to carry electric fence reels and standards safely and securely, the imaginations of the designers and engineers appeared to show no bounds. Quite often some ideas are just the simplest, such as a bale feeder that was based around a conveyor belt, and could be easily fitted to a trailer or the old farm truck to make feedout a breeze. One thing’s for sure, the Australian farmers’ thirst and acceptance for new ideas, buoyed by the enthusiasm of the Elmore organising team, will ensure that a little bad weather won’t dampen the spirits, and as one old sage told the DNA team: “the crops in the area have never looked so good- all we need now is a spell of sunshine to make some hay”.

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MACHINERY & PRODUCTS  // 25

Treadmill inspires novel hay feeder

Pat Daniher, Girral, was the winner of the inaugural Henty AgriInnovators Award. Photos: hmfd.com.au

AN EASY solution to

feeding out fodder off the back of a ute has earnt a southern NSW farmer the inaugural Henty AgriInnovators Award. Girral farmer Pat Daniher showcased his hay and silage feeder at the Henty Machinery Field Days after finetuning it during months of feeding sheep on his own farm.

by HMFD Co-operative members Nigel Scheetz, Culcairn, Kerry Pietsch, Pleasant Hills and Joshua Maher, Holbrook. Mr Scheetz said the winning entry was O H & S friendly, affordable and could be used by people of all ages and skill. “It was easy to detach from the vehicle and place on a trailer, it was well made, had longevity and

“People come to the field days to look at something different so I hope I contributed to that.’’ – Pat Daniher While using a home exercise treadmill, Mr Daniher came up with the idea of adapting the concept into a conveyer belt feeder. Mr Daniher’s invention was up against a pivoting post-hole shovel from Dederang farmer Stephen Quast, a star picket post straightener from Allan Hilder, of Burcher, NSW, and a slip-on fencing tray from Peter Kelly, Rugby, NSW. Barry Bennett, Barooga, entered a dual way gate stopper, modern ATV shovel holder, and front-end loader three point linkage lifter. Sam Turnbull, Wagga Wagga, impressed judges and the crowd with his Hammerhead rock crusher. The entries had to meet the criteria of having a practical on-farm application, be based on an original idea of the entrant and not be in full scale production at the time entry. The award was judged

simple mechanics.’’ Mr Scheetz said the award attracted a vast amount of interest from a broad spectrum of agriculture. “It was good to see the farming community still has ingenuity and good ideas,’’ he said. Pat Daniher was thrilled to win and said feedback had been positive. “People come to the field days to look at something different so I hope I contributed to that,’’ he said. The remote controlled Daniher Belt Feeder is designed to fit on the back of a trayback ute and capable of handling large square hay or silage bales. The belt feeder is remotely controlled from within the ute cab, turning feeding-out into a one person operation. The belt is operated by a boat winch at variable speeds to drop hay either three to four metres apart, or further to accommodate shy feeders.

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DAIRY NEWS AUSTRALIA OCTOBER 2016

26 //  MACHINERY & PRODUCTS

Pivoting post-hole shovel saves time during fencing jobs A SIMPLE invention of a pivoting

post-hole shovel has saved many hours of laborious work for Kiewa Valley dairy farmer Stephen Quast. Mr Quast, of Dederang, is among the entrants in the Henty Agri-Innovations Awards with his labour saving device for digging post holes. The shovel features a handle which allows the blade to tilt 90 degrees, enabling the operator to trim the hole and scrape the bottom. The shovel allows rocks and mud to be easily removed from the hole. Mr Quast invented the shovel more than 15 years ago and has used it regularly on his farm. “It has saved me a lot of hours over the years – there are still many fence posts concreted or rammed in so it is useful,’’ he said. “I’ve dug hundreds of holes with it over the years – I made the metal version over 15 years ago and has proven to be quite robust.’’ Stephen and his wife Lynda milk 80 Normande cows on their Dederang farm.

The French breed is known for its protein and high presence of kappa casein B making the milk ideal for cheese. Stephen also drives buses while Lynda makes fetta cheese and soap from her goat herd, runs alpacas, produces honey and makes her own bread. Mr Quast was disappointed to find the farm inventors award had been cancelled at Henty last year after intending to enter the shovel. The shovel head can pivot through 90 degrees. He made the original version while helping his father with fencing jobs. “I got frustrated with the shovelling and thought about putting a pivot head on a shovel,’’ he said “I made the first version and used it for many years, and later made a lighter model. “The only similar thing on the market has two handles and users a pincer action.’’ Stephen worked at Kiewa Valley Engineering as a teenager and has maintained a life long interest in engineering.

Sheds on the Quast farm are bulging at the seams with scrap metal and spare parts waiting to be turned into another handy item. Stephen Quast is constantly coming up with new ways of making jobs easier on the farm. “I see potential in things – if I wasn’t so busy farming I would be making a lot more stuff,’’ Mr Quast said. Stephen and his sons Karl and Daniel have made a tipping tray for their ute, added a tailgate to the early silage wrapping machines and bale grabs for the tractor among many projects. His sons Karl and Daniel have picked up the family interest in all things mechanical. “Dad is always doing something creative and taught me how to work with hand tools and fix motors,’’ Karl said. “You don’t go to Henty with Dad as it means going into the tool tents for three hours and half a dozen trips back to the car with things he has bought. “One year, we got a bag trolley to push around all the stuff he had bought.’’

Stephen Quast is constantly coming up with new ways of making jobs easier on the farm.

Mr Quast conceded one year he returned to Henty the next day with a ute to pick up goods he had bought at the field days and couldn’t fit in the car. He has even worked at Henty as a representative for an organic fertiliser company.

“I’m always interested in the machinery – how things are made and can never go past the inventors section,’’ he said. “The only way to see if my invention is a good idea is to put it out there.’’ (Source: www.hmfd.com.au)

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