Dairy News 11 Dec 2012

december 11, 2012 Issue 282 // www.dairynews.co.nz

one plan, too many problemsStress levels risepage 5

no rolloverAverting ATV injurypage 38

Successor to Clean Streams Accord coming. page 8

no tIme to slow downOutgoing Fonterra chairman Henry van der Heyden’s vision for Fonterra. PAGE 3

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news // 3

news ��3-21

opInIon ��22-23

agrIbusIness ��24-27

management �� 28-31

anImal HealtH �� 32-36

macHInery & products ��37-39

tractors & macHInery �� 40-42

Dairy helps Canterbury economy recover. pg.04

Using supplements widely with hay feeder. pg.38

Forty years of flood-free farming. pg.14

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‘No time for a cup of tea’outgoIng Fonterra chairman Henry van der Heyden is cautioning farmers against any strat-egy likely to slow the co-op’s growth.

With a lower payout signalling tight on-farm cashflows, farmer anxiety is growing but van der Heyden says now is the time to be bold and increase the pace. “In five years I want to see Fonterra farm-ers the wealthiest farmers in the world,” he told Dairy News. “We have to capitalise on opportuni-ties.”

The Putaruru farmer leaves the chair at next week’s annual meeting having served 10 years. He will remain a director until May 2013.

He highlights the achievements during his watch, saying it laid a solid foundation for accel-erated growth. And he lists Global Dairy Trade (GDT), TAF (trading among farmers), free trade agreements, co-op governance model, developing business relationships with other major global dairy players and appointment of a new chief executive and chairman-elect as game changers for the co-op.

He admits there were bumps but farmers supported him and the co-op all the way. TAF took longer than nec-essary to finalise and there was farmer opposition. “There were turbulent waters around TAF but no one can say TAF has not been successful.”

Van der Heyden says with TAF underway, the foundation is set for the co-op to take off. This is no time to rest or “sit down for a cup of tea. Farmers are tired and need a break but we need to keep going. The new chief executive and chairman-elect have a strategy in place so farmers shouldn’t be thinking about taking a breather.

“The strategy refresh is not about slowing down but making decisions faster. It’s all about maximising payout for farmers and higher profit for investors.”

Van der Heyden acknowledged cashflows are tight on farms and this causes anxiety among farmers. “But this is the time to be bold and take leadership. There are opportunities in China and other developing regions. If we sit on our laurels,

our competitors will be there before us.”As well as pursuing opportunities overseas Fon-

terra must lift its game in sustainability and its pro-file among New Zealanders. For example, the Milk for Schools scheme, an initiative by chief executive Theo Spierings, launched in Northland, has received positive feedback.

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NORTHLAND SCHOOLCHILDREN have been drinking more milk, at school and at home, since the Fonterra Milk for Schools scheme launched in early 2012, according to an independent evaluation by the University of Auckland.

The co-op commissioned the report to understand the impacts of its school milk pilot

on children’s consumption and attitudes to dairy.

Associate professor Cliona Ni Mhurchu, who led the evalu-ation, says the results show a significant increase in children’s milk consumption following the adoption of the scheme in Northland schools.

Notably, consumption has in-creased at school and in homes, the evaluation showing 28%

more students reported drinking milk five or more days a week.

Also, the evaluation showed more children are drinking milk at least twice a day; those drink-ing it twice or more each day rose from from 66% to 77%.

“The evaluation provides evidence [the scheme] is help-ing to increase children’s milk consumption during school time and overall,” says Mhurchu.

Fonterra general manager cooperative social responsi-bility Carly Robinson says the cooperative is encouraged by the findings.

“Our goal… is to make a last-ing difference to the health of… children. New Zealand is the largest exporter of dairy prod-ucts in the world but at home we’re not drinking as much milk as we used to.”

nortHland KIds drInKIng more mIlK

Outgoing Fonterra chairman Henry van der Heyden (left) says chief executive Theo Spiering’s strategy refresh is about promoting growth.

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4 // news

tHe prIce of units in Fonterra Sharehold-ers Fund is dropping after touching $6.95 last week. They launched at $5.50.

On two consecutive

days last week, 15c was shaved off the price. It was trading at $6.66 on Thurs-day as Dairy News went to press.

Broker Grant Williamson, Hamilton Hindin Greene, says it will take a week or two before the price finds the

“appropriate level”.“We have some profit

taking during the first few days of trading. Investors who bought the units at $5.50 each gained in excess of $1/unit by selling,” he told Dairy News. “But it’s settling down and volumes have slowed down.”

Williamson believes retail investors, most of whom missed out on the heavily oversubscribed units, are watching from the sidelines for prices to drop before they bid. Retail investors are not the only ones taking a wait-and-see approach. Fonterra farmers are also cautious. “They are also waiting to see where things will settle and the farmers market is very quiet at the moment,” says Williamson.

Just 260 of Fonterra’s 10,500 farmer sharehold-ers holding 5.5 million shares have sold their divi-dend rights into the fund. The co-op has issued shares to make up the shortfall in the $525 mil-lion fund.

Launched on Novem-ber 30, TAF (trading among farmers) offers economic rights in the co-op shares through the Fonterra Shareholders Fund.

In an email to farmer shareholders, Fonterra chairman Henry van der Heyden and chief execu-tive Theo Spierings told farmers to expect more volatility in unit prices.

“Don’t be surprised to see more of this price movement over the

coming weeks while the shares and units establish their value,” they said.

Farmers were also told they don’t need to trade shares immediately. “All farmers are already com-pliant with the share standard for the current

2012-13 season,” the email says.

However, they cau-tioned farmers to be wary of media commen-tary on TAF and the FSF unit price. “Expect a lot of media interest and com-mentary around the price,

but don’t get sidetracked by it. We’re certainly not going to get distracted. TAF was about removing redemption risk and giving farmers some more flex-ibility.”

Fonterra’s new Darfield site is an important boost to the quake-rav-aged Canterbury region, says chair-man-elect John Wilson.

Speaking last month at the open-ing of a $200 million drier, Wilson noted the dairy sector employed 5000 people in the region. As the largest dairy processor in the country, Fon-terra contributed $1.8 billion into the region last year through milk payout to suppliers.

“In addition, we made further contribution through our links to

supporting sectors, such as freight, transport, storage, packaging and agricultural services.”

The new drier can process 2.2 million L of milk daily. Fonterra is also building a second $300m drier at Darfield which will lift capacity to 6.6m L/day.

Wilson says the decision to invest $500m in Darfield’s two-stage devel-opment was not made lightly. “We are a cooperative and must be answerable to our farmer shareholders for every dollar spent in the running of this business. With recent milk produc-tion growth of 5-6%, we see a strong dairying future for the Canterbury region.”

Fonterra chief executive Theo Spierings says New Zealand milk remains the backbone of its strategy.

The co-op is also building more warehouse capacity and a rail link between the Darfield plant and Lyttel-ton Port.

Spierings says Darfield’s second drier will be the highest yielding in the world and will raise efficiency and payouts to farmers.

Prime Minister John Key joined 250 Fonterra farmers and staff for the official opening. Key described Fon-terra as New Zealand’s “only truly global champion”. “Fonterra is one name known around the corporate world,” Key says.



A boost for Canterbury’s fledgling economy

Prime Minister John Key with Fonterra Darfield staff at the opening.

ABOUT 2500 farmer shareholders, share-milkers, retired farmers and staff have ap-plied for units in FSF.

A further 260 Australian dairy farmer sup-pliers have applied to buy units.

The 2500 New Zealand ‘Friends of Fon-terra’ applicants included nearly 900 farm-ers, 200 sharemilkers, 70 retired farmers and at least 1300 staff.

tHat’s wHat FrIends are For

Unit prices soar then settle as TAF gets underway


Fonterra chairman-elect John Wilson (right) and shareholder Philip van der Bijl at TAF launch.

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news // 5

Farmers stressed out by One Plan

many daIry farmers in the Horizons Regional Council area are suf-fering from stress and depression because of the One Plan, according to DairyNZ. Team leader, lower North Island, Kevin Argyle says his consult-ing officers who run regu-lar discussion groups are noticing this among dairy farmers attending these discussions. He says this is of considerable concern.

Argyle has also con-firmed that DairyNZ has done its own indepen-dent economic analysis on the One Plan which shows that at least 450 dairy farmers face a drop in income of between 25% and 30% if the version of the One Plan handed down by the Environment Court stands as is. This is in sharp contrast to the claims by Horizons that

the economic impact will be between 1% and 16%.

In an effort to help the region’s dairy farm-ers cope with the diffi-cult financial situation resulting from one plan, DairyNZ last week ran four special workshops.

“One Plan will involve significant changes for those 450 dairy farmers that are in the three sen-sitive catchments zones. They are the ones that are going to be the most chal-lenged in terms of meeting the new N leaching tar-gets. They are required to do a nutrient budget and a nutrient management plan each year as part of their consent application to Horizons. The fact is no farm is the same - they are all different and unique and do things slightly dif-ferently,” he says.

The other issue facing farmers is the change to Overseer 6 from Overseer 5.4. Under the latter, many farmers met their N leach

peter burKepeterb@ruralnews�co�nz

targets, but with overseer 6, these same farmers are over the limit. Somewhat ironically another issue to emerge is that poor drain-ing soils are now seen to leach less N than the freer draining and more pro-ductive soils. All this and the debate on what One Plan will ultimately cost farmers is causing stress and anxiety.

“Farmers may have to make changes to their farm systems to ensure that their businesses are sustainable. They may have to change their farm systems in terms of fertil-iser use, their per cow per-formance to see if this can offset a need to drop their stocking rates,” he says.

This is the reason that DairyNZ in conjunction with Fonterra held the special One Plan field days – to try and help farmers find a solution and work their way through a dif-ficult and stressful time. “We are going to have to

do a lot of field days for farmers. After the Friday field days the first thing I would do as farmer in a sensitive catchment zone is ask who’s going to model my farm, in terms of the systems mitiga-tions, changes, and what that would enable me to achieve in terms of my farm, its productivity, per-formance and profitability, and the cost of doing this,” he says.

Argyle says the prob-lem has not been helped by the war of words that is going on about the impacts of One Plan. He says DairyNZ has done it’s own independent research which is at variance with Horizons numbers.

“Unfortunately people are not comparing apples with apples. Horizons are talking about a 1% to 5% change, but they are talk-ing about revenue, while others are quoting operat-ing profit so they are not talking about the same

thing which is not very helpful. The modeling that we’ve done does suggest that some of the worst affected farms could incur between 25% and 30% loss in operating profit in the medium to long term,” he says.

Wintering stock off the

pasture will become more common says Argyle. He says many farmers may opt for feed pads or cow shelters as a means of meeting the N targets – actions which will add to the cost of dairying in the region. “Farms with sig-nificant areas of high LUC

class, high rainfall and free draining soils are going to struggle to physically meet the targets and they may need restricted discretion-ary consents from HRC to farm,” he says.

DAIRYNZ SAYS One Plan is not consistent with National Policy Statement on Fresh-water Management. In the latest edition of its publication, Inside Dairy, the organisation says the plan will have to be reviewed in the light of this inconsistency. It says DairyNZ will support farmers in seeking this review.

DairyNZ says it also doesn’t accept that the Environment Court has ‘struck the right balance’ with its decisions. This is the first time that DairyNZ has made any major announcement on One Plan. It was not involved in making submissions on the plan, leaving this to Fonterra and Fed Farmers. But DairyNZ says it will now work to support farmers and work with Fonterra and others to provide any assistance.

water plan not consIstent wItH natIonal strategy

DairyNZ’s Kevin Argyle says Horizons’ One Plan is causing anxiety among farmers.


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6 // news

Rod Quin

Westland chief has dig at GDT

global daIry Trade prices are well short of

European prices and that’s disappointing for the New Zealand industry, says the chief executive of West-land Milk Products, Rod Quin.

Milk fat derived prod-ucts in particular are dis-counted on the auction platform which is “a bit frustrating because the auction sets the reference

andrew swallowandrews@ruralnews�co�nz

price,” Quin told Dairy News.

“Europe’s exporting butter at US$4400-4500/t. New Zealand butter is at $900/t less. That’s very disappointing.”

Quin says Westland’s payout forecast for the current season remains at $5.40-5.80/kgMS, the strength of the New Zea-land dollar offsetting the gradual lift in markets over the past few months. “There’s probably more upside if New Zealand supply is not as strong as predicted.”

Reflecting on West-land’s 2011-12 season payout of $6.14/kg, and recent annual meet-ing, Quin says finishing 26c behind Fonterra isn’t acceptable.

Shorter contracts resulting from West-land’s smaller scale meant it was more exposed to the falling market than its bigger cooperative rival. However, there’s a 25c “structural gap” between Westland and Fonterra’s returns because Westland doesn’t have the value-add and ingredients business Fonterra does. “We have to change what we make and what we sell it for. We don’t have a big consumer business.”

Westland’s nutritional product plant at Hokitika starts that process. It was commissioned in Septem-ber and “is on schedule” to start regular processing from February. “People are not going to place orders without testing products commercially,” he points out.

Meanwhile DIY yoghurt business Easiyo, Westland’s “one signifi-

cant consumer brand”, is growing rapidly, with sales of $39m last year, up from $22m two years pre-viously when the cooper-ative took full ownership. “It takes about 2% of our total product, about 4% of our milk powder.” Quin sees that growth continu-ing as to date the brand is established in just a hand-ful of countries.

As for where the coop-erative’s milk is coming from, this season the “15 to 20” suppliers from Can-terbury, up from four last year, is “in line with our targets.”

Quin describes as “robust” the level of enquiry to supply West-land from Canterbury for next season.

The cooperative’s growing east coast supply has caused “a bit of a ripple among the share-holder base” as some feel it is coming ahead of core, West Coast supply. Quin stresses that’s not the case, and West Coast growth “is always our pri-ority.”

However, “the reality is that by moving into Can-terbury we can grow our supply quickly,” he adds, noting opportunities for conversions and scope for production growth on the coast are more limited.

No decision has been taken on whether to build a processing plant at Rolleston, alongside the existing office and con-densing infrastructure. Consent applications were lodged in September. “I still think we’ve got to have it on the horizon. It’s just when and how.”

new ceo For easIyo

BRIAN DEWAR, general manager NZ sales for Vitaco Health, will move to become chief executive of EasiYo in March, allowing current Easiyo chief Paul O’Brien to focus on growing business in selected Asian markets.

“Brian’s experience with Vitaco is directly relevant to his new role, as is his previous employment with the likes of Healtheries New Zealand and New Zealand Milk,” says Quin.

“His experience encompasses national and overseas positions, an essential require-ment for the leader of a company that exports around the world.”


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8 // news

WRC’s Variation 6 seminars popular

a serIes of DairyNZ seminars organised to help farmers cope with the complexity of Waikato Regional Council’s new Variation 6 water allocation rules is proving popular with farmers.

Variation 6 relates to a series of water allocation rules in the Waikato Regional Plan where, generally, fresh-water uptakes greater than 15m3 per day require a consent.

The rules affect dairy farmers as well as industry, local councils, commercial growers and others who use large quan-tities of water.

For dairy farmers the main use of water is milk cooling and dairy shed washdown and in some cases irrigation. Brigid Buckley of DairyNZ has been organising the seminars and says she’s pleased with the outcome. A total of thirteen seminars were organised with some, such as the one in Te Awamutu, attracting 140 farmers; most attracted 60-70 farmers.

She says the purpose of the seminars was to help farmers upskill to deal with the rules that the council is now imple-menting across the region.

“It’s the council who has developed these rules and is now working with farmers to implement them. But we saw a need to help farmers cope with what the council was requiring of them. We wanted to ensure farmers get the right amount of water for their system and to help them find ways of using water more efficiently.”

She says showing farmers how to be more water-efficient was a big focus of the seminars. “There’s an opportunity to grow their businesses if they can make more efficient use of the water within their farm system.”

Under Variation 6, farmers who were operating their farms before October 15 2008 will have their water uptake vol-umes ‘grandparented’ back to this date. However, they will need to provide evi-dence of that water volume. This can be an issue, says DairyNZ, as not many farmers had water meters installed at this date. “In the absence of not ‘know-ing’ water volumes used for milking, cooling and dairy shed washdown in 2008, the regional council will use a default calculation of 70 L/cow/day,” she says.

New accord on clean streams coming

a new accord to replace the now expired ‘clean streams accord’ is in its final stages of preparation and is expected to be launched early in the new year.

Called the ‘sustainable dairying water accord’ it has been promoted by the Dairy Companies Association of New Zealand (DCANZ) and DairyNZ with input from Federated Farmers and other stakeholders.

DCANZ executive director Simon Tucker (also DairyNZ policy and advocacy manager) says the new accord will focus on riparian, nutri-ent, effluent and water use man-agement and dairy conversations. Though the clean streams accord had its critics, overall it was successful for the industry, he says.

“With that expiring this year, we thought we should be doing some-thing new. We talked to a lot of farm-ers, Federated Farmers, the dairy

companies, industry stakeholders, central government, regional coun-cils, iwi groups and environmental NGOs. The consensus was that having a succes-sor to the clean streams accord was a good idea.”

The new accord will have targets based on the five main areas, with final detail yet to emerge. Prominent in the new accord will be the influ-ence of the Land and Water Forum (LAWF) of which Tucker was a member.

One message from LAWF was that the best way to address water quality and quantity concerns was to do it collaboratively – the industry work-ing with regulators and other stake-holders to fix the problems.

“So we’ve taken a collaborative approach to thinking about how this document might come together. The other thing the LAWF report iden-tifies is the need for industry good

management practices as being one of the key ways that water quality can be improved. This new accord is

all about indus-try self improve-ment and the adoption of good management practice We had conversations at the LAWF table about where the dairy industry was going with a new accord and received a lot of positive feed-

back about it,” he says.Tucker says there has been good

consultation with green groups and with other parties. He says a group that will play a significant role in the new accord is the Dairy Environmen-tal Leadership Group which has rep-resentation on it from industry as well as central and local government.


Simon Tucker


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news // 9

Fonterra board hopefuls meet farmers

would-be Fon-terra directors have been campaigning for weeks, meeting as many voters as possible in the run-up to the election. Eleven candidates are con-testing three seats.

Voting runs from November 26 to 10.30am on Saturday December 15, when it closes online. Results will be announced to the candidates, media and the New Zealand Stock Exchange on the morning of December

17, the day of Fonterra’s annual meeting.

“Voting coincides with all the pre-Christ-mas postal rush so we are urging shareholders using postal voting to get their voting papers posted early,” says the returning officer, Warwick Lampp.

The electioneering roadshow held 11 meetings in five days from Whanga-rei to Invercargill between December 3 and 7.

At each meeting each candidate had two min-utes to give a resume and then those present were split into 11 groups and

tony HopKInsoneach candidate circulated to answer questions posed by shareholders. Opportu-nity abounded to interact with suppliers.

Responsibility for the election is held by the Shareholders Council which sends the details to electionz.com Ltd.

One of Lampp’s duties is to explain the Candi-dates Code of Conduct to

all candidates and to check they are being adhered to.

As returning offi-cer he hopes to see a fur-ther increase in electronic voting through the inter-net. “First used in 2004 13% of votes were returned through the internet and for elections in 2011, nearly 52% of votes were through the internet. It is so much easier and

straightforward.”Reflecting changes in

technology, in 2003 38% were returned using fax machines and this had dropped to just under 15% in 2011. Sharehold-ers with one or two farms get a voting pack for each farm; shareholders with several farms get one pack containing a voting pack for each property; 10500

voting packs were sent out. “Doing this saves a lot of money and makes it easier for shareholders.”

Lampp says about 50% will vote, of whom more than 50% will vote elec-tronically. This entails shareholders logging to their Fencepost account, and clicking on a prom-inent link to go to the voting site.

ELECTIONZ.COM Ltd is a company founded 10 years ago to organise and manage elec-tions. In this time it has run more than 1,000 elections and processed 25 million votes.

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Warwick Lampp organising the pres-ent elections for the Fonterra Shareholders Council and the board, is based in Tauranga and it is a job he has done before.

He comes from a sheep and beef farm-ing background at Marton. He did a business degree at Massey then went to local gov-ernment administration for councils firstly in Rangitikei, then Papakura and Central Hawkes Bay..

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He stresses that he and electionz.com are completely independent from every client, so that the integrity of the democratic process is maintained at all times.

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10 // news

Chris Kelly

Landcorp moves to fix Crafar farms

days aFter taking over management of the Crafar farms on behalf

Shanghai Pengxin, Land-corp is spending money to fix up some problems on the properties.

Landcorp chief exec-utive, Chris Kelly told Dairy News that they

have few issues of sig-nificant deferred main-tenance which the receivers couldn’t under-take because they were not able to spend the banks’ money.


“The three issues that really concern us are health and safety for the staff, animal welfare and environmental issues. We’ll fix any health and safety issues straight away. We have a few effluent issues where some efflu-ent ponds are not up to scratch and we’ll address that urgently. We also have a couple of farms where they are overstocked which is an animal welfare issue and we are going to fix that.

“Going forward we have issues like a couple of the dairy sheds that need bulldozing down and new ones built and we’ll also do that soon. After that we are going to have things like more fertiliser, more subdivision, more water, more fencing and just gen-erally lifting the quality of the farms.”

Kelly says the receivers have done a pretty good job upgrading the cows and they are in reason-ably good shape. But Kelly says they will continue to upgrade the herd as part of their management con-tract.

While Landcorp will now oversee the man-agement of the farms, they don’t take over as the ‘sharemilker’ until June 1 next year. Up until then, the sharemilkers appointed by the receivers will carry on as normal.

Kelly spent much of

last week visiting the farms and talking to the sharemilkers. He received a positive feedback from sharemilkers.

“We are going to offer all of them positions at Landcorp. I never heard any of them say ‘there is no way in hell I am going to work for you’; in fact it was quite the opposite. Some were saying that’s a good idea and they were really keen to get to know us. We are no different from any other company. People are the impor-tant component of this and these guys know the farms, many of them are good sharemilkers and we would like them to join Landcorp, but it’s their decision.”

One of the immediate problems facing the farms is an impending drought and Kelly says they will have to take some action immediately to deal with this. He says they haven’t got the feed on the farms they thought they might have had; extra supple-mentary feed has already been bought in.

“We are going to incorporate these farms as part of the greater Landcorp group, so we’ll shift stock off those farms that are running tight to our own where there is more feed. We are also going to shift around silage and baleage to get things right.”

YOU COULD almost hear the sigh of relief in Wellington when the deal between Shanghai Pengxin and the receivers, KordaMentha was finally consummated last week. It’s taken two years and had to go through many hurdles including a series of legal challenges.

Brendon Gibson of KordaMentha says the sale of the farms was one of the most difficult, challenging and complex transactions they have ever completed. He says despite the long and challenging process they are happy to have secured the sale at a pleasing price. He says Pengxin’s offer was far and above the best offer received.

“We have operated the properties for three years and the farms have been handed over as a full going concern for Pengxin and Landcorp. The farms we inherited required some hard work and investment during a volatile eco-nomic environment. We understand that the new owners and operators will continue that work and investment in the farms.”

partIes Happy deal sIgned

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12 // news

taranaKI Farmers Chris and Catherine Cook are reported to be distraught after 120 cows – a quarter of their herd – died suddenly last Tuesday.

Catherine’s brother John Murphy says cows started going down on the farm near Hawera within 30 minutes of troughs being topped up from a por-table tank.

“Watching them die was the hardest thing,” Murphy told Dairy News. “There was nothing anyone could do. It all happened very quickly.”

Vets were called immediately and 20 rushed to the scene.

“But there was little they could do… For everyone involved it was heartbreaking… we are now work-ing with MPI to investigate the cause and attention is focussed on the portable tank.”

Local media pointed to nitrate poisoning as a possible cause but Murphy believes that’s “highly unlikely.” “It’s a one-off and the vets don’t know what it was.”

Thirty cows which went down survived. The whole herd was in the same paddock when cows started collapsing but were released soon after the first fatalities.

Murphy says the tank is the farm’s own and reg-ularly used for water.

“We would like to thank South Taranaki Vets for their prompt response and also thank Fonterra, Fed-erated Farmers, Rural Support and DairyNZ in what is a very distressing time.”

Cows drop dead, owner left baffled

Feds hunt on TPP fringe

many countrIes find the concept of free trade ‘foreign and threat-ening’ says Federated Farmers president Bruce Wills.

He and his counter-parts from Australia, the National Farmers Feder-ation, are this week join-ing the throng of 500-plus negotiators and support staff in Auckland for round 15 of the Trans Pacific Partnership talks.

Eleven countries are at the talks: Australia, Brunei,

Darussalam, Canada, Chile, Mexico, Peru, Sin-gapore, US, Vietnam and New Zealand. The goal is to establish a regional free trade zone which would see the removal of tariffs which reduce returns for New Zealand farmers.

The freeing up of trade would make a huge differ-ence to our dairy industry, but convincing a coun-try like the US to do this is a challenge. Dairying is a sensitive issue and one that probably won’t be resolved until later rounds in the negotiations.

Wills says enormous gains would be made if

a favourable deal was to be negotiated. “Every year trade tariffs cost this country well over a $1 bil-lion. We live and breathe free trade as everyone in New Zealand knows. We sell over 90% of what we produce - it’s part of our DNA, he says.

But Wills concedes not many countries think the same way as New Zealand. “I was in Rome earlier this year at the World Farm-ers Organisation confer-ence where we talked long and hard on trade. There were 41 countries repre-sented in that room, but only three of us of 41 sup-

ported free trade; so it was hard work.”

At the TPP in Auck-land this week, the ANZAC spirit will be alive and well. Feder-ated Farmers and the National Farmers Feder-ation are hosting a func-tion at which they hope to at least informally get the message across about the value of free trade.

“The Kiwis and Aussies are strong allies in this one. They, like us, have their borders open for free trade and they see the benefit of it. They, like us, produce more food

than their 20-plus mil-lion people can consume. We work together well and need all the support we can get because we are very much in the minor-ity,” he says.


Bruce Wills

Anti farming symbol goes

RMA reform bill tableda parlIamentary bill that will be music to the ears of many farmers will this week have its first reading in Parliament.

The Resource Management Amendment Bill proposes changes to clarify and improve the work-

ability of the RMA, including a requirement for local councils to prove their economic analysis of their regional plans.

The Minister for the Environment and the Minister for Primary Industry recently criticised

councils for their “woeful” and “sub-optimal” section 32 reports.

The bill also proposes local authorities increase the trans-parency of their decision making, and calls for faster processing of

medium-size consent applica-tions and more consistent decision making on issues governed by clear national guidelines.

The bill will be introduced into Parliament by the Minister for the Environment, Amy Adams.

THE GREEN rig, an environmental education

vehicle belonging to Horizons Regional Council,

is to be sold.The rig, an articulated

truck, drew massive criticism from the region’s

farmers, who perceived they were being blamed

for damage to the environment.

Launched in May 2007, the green rig was promoted

as a giant educational toolbox-on-wheels to

raise public awareness of regional environmental

issues. It was used as an exhibition, classroom and

meeting space. Horizons Regional Council

said it informed about four environmental issues

in the region: declining water quality, scarce water

resources, eroding land and declining native habitats.

One of its “knowledge partners” was Federated

Farmers.

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Forty years of flood-free farminga crucIal flood pro-tection scheme in Waikato this month marks its 40th anniversary.

The Waihou Valley Scheme (WVS) – river and catchment infrastructure worth $130 million – was started in 1972. It covers 220,000ha on the east-ern side of the Hauraki Plains and Thames Valley, from Putaruru to Thames. It guards against flood-ing at Paeroa, Te Aroha and Thames, and allows 50,000ha extra land to be farmed safely.

Since European set-tlement floods have at times inundated parts of the Hauraki Plains and Thames Valley, creating a “vast inland sea”. That prompted stopbanking works last century.

The WVS built on and improved this flood pro-tection, doubling the Waihou River floodway, damaged after two big floods in the 1950s and 1960s. Regular flooding after 1972, especially in 1981 and 1985, emphasised the need for the WVS to be completed.

Mostly built between 1972 and 1995, the WVS now incorporates 177km of stopbanks to prevent waterways flooding land, 75 floodgate structures to manage waterway flows, 20 pumping stations to drain water from farmland, and at least 550ha of soil conservation planting, fencing and erosion protection structures.

Matamata-Piako coun-

cillor Phillip Legg says prior to the WVS being fully developed, it could expect 1981-level flood-ing in Paeroa, Te Aroha and Thames every five to 10 years.

“Now it takes a one-in-50 year event to cause significant flooding in those towns, protecting private property, urban businesses, and industry and agriculture generally. The floods in 1981, 1985, 1987, and more recently with the severe weather bombs, do not have the same consequences due to the assets installed by the regional council.”

Thames-Coroman-del councillor Simon Friar says the scheme’s sup-port for farming in par-ticular paid dividends for

the local communities protected and the wider region. “The WVS – cou-pled with the adjoining Piako River Scheme – means a huge area of farm-land is able to be farmed safely, providing a major economic boost for our region.

“Also, roads across the Hauraki Plains and the

base of the Coromandel Ranges don’t get cut off as they did historically, a fact appreciated by locals and the large number of people with holiday homes on the Coromandel.”

River and catchment services operations man-ager Guy Russell says the WVS was the first scheme in New Zealand to use

a “whole of catchment” approach.

“The works not only include flood protection but involve willow clear-ance from river channels, extensive river chan-nel management and soil conservation works such as riparian fencing, land retirement and control of pests such as goats. All these combine to help us manage the flow of water-ways and protect land from being eroded away in floods.”

Russell says the regional council worked closely with the Hauraki and Thames-Coroman-del district councils to manage drainage issues, while the Department of Conservation also carried out work to control goats in the area.

“The benefits delivered by the WVS complement the work of those pro-vided by the councils and DOC and helps give us the best value for money from what we do.”

Stopbanks at the junction of the Kurere Stream and the Waihou River protecting nearby farmland from swollen waterways.

Paeroa during the 1981 floods.

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news // 17

letter

no effects from variation 5DAIRY NEWS (November 27 issue) com-mented favourably on a letter from Geoff Burton suggesting that trout stocks in Lake Taupo may be declining because less nutrients are going into the lake because of Waikato’s Regional Council’s new Variation 5 policy�

The reality is that over the past 10 years the load of nitrogen carried by the inflows into the lake has increased by about 1% per year, while the load of phosphorus has decreased at about a similar rate� Nothing in these figures that we’re aware of would indicate any reduction in nutrient loads that may lead to trout numbers declining� Neither figure has been influenced by Variation 5�

We hope Variation 5 will eventually mean the load of nitrogen that will enter the lake will be lower than it would otherwise have been if nothing had been done� But, even so, our water scientist considers the load of nitrogen entering the lake in the future is unlikely to ever be lower than it was in the recent past�

We’re aware DOC is undertaking a major study to see why trout stocks have declined in the lake� But, contrary to Mr Burton’s claims, DOC confirms to us that it has not suggested the lake is now “too clean for trout” and certainly hasn’t claimed Variation 5 has caused any problems�Laurie BurdettTaupo councillorWaikato Regional Council

Farmers praying for a wet ChristmasdaIry Farmers are on ten-terhooks waiting to see what the weather does in next two weeks.

It’s generally been drier and colder in most parts of the coun-try and if this pattern were to con-tinue for much longer there are fears that dairy farmers may be in for a poor season. DairyNZ has been closely monitoring the situa-tion and is urging farmers to have contingency plans ready in case things take a turn for the worse.

Craig McBeth of DairyNZ says the challenge is that so far this season there’s been less supple-ment made on farms because the grass has been eaten by cows so there are not the usual banks of feed available. He says it’s inter-esting to note that the soil mois-ture map at Ruakura near Hamilton is identical to what it was a year ago.

“The difference was that last year from this point onwards we had good rainfall throughout the

summer with the exception of Southland. So the bit we don’t know now is what the season is going to bring for us. There are indications that we might have a mild El Nino effect which of course makes for a windy summer and drier on the East coast and wetter on the west coast. All we can say to farmers is do your planning and be prepared. There is some good information on the DairyNZ website and on page 15 of our Inside Dairy publication. This is all about setting up for summer,” he says.

McBeth agrees that the next two weeks are crucial in terms of the industry. Lack of good rain makes it hard for pastures to recover. He says this makes hard for farmers to push out their round length and it can reduce the ‘leaf area index’ of their pasture.

“Farmers need to be prepared to make some decisions and have trigger points identified to act on. This includes when to cull empty cows, even though they may be milking well now. At some point in the season they are going to

become passengers. Farmers also need to source supplements and have some buffers in place. It’s about looking at various scenarios and having a plan in place to act on what might occur,” he says.

Farmers should find feed at a good price and have it on farm when they need it. But he says if it’s not economic to do this, farm-ers should look at reducing their stocking rate and reviewing their culling policy.

“Getting rid of some of the cows you were going to cull at the end of the season earlier so that the stayers you can milk through to the end of the season effectively. Then you can make the best of the autumn rains that you’d normally

expect to arrive,” he says.The other area of concern to

dairy farmers is the state of the all-important maize crop. It requires heat and good sunshine hours as well as moisture and unless the situation changes there are fears of lower yields this season.

“Maize is one of those crops you’d expect to be above the fence posts by Christmas and the usual fear is that it’s never going to get there. But so often Christmas arrives and it’s well over the top of them. Once maize gets estab-lished and kicks in it does do well. It’s very early days yet and we have got a long way to go before we har-vest the maize crops and know for sure,” says McBeth.


Less suplements are being made on farms this year.

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18 // news

in brief

Co-op plans third drier at Pahiatua

Polluting costs farmers plenty

Fonterra Is planning a third drier at Pahiatua plant in lower North Island to process an extra 2.5 million L of milk daily, raising Pahiatua’s capac-ity to almost 4mL/day.

Fonterra director New Zealand operations Brent Taylor says the third drier would help ease peak pro-cessing pressure in the lower North Island.

“Our two existing driers at Pahiatua are already running at capacity, pro-

cessing 1.4 million L per day, and for the past 12 years we have had to send at least 1.6 million L per day by rail to our site at Whareroa.

“While most of the growth in dairy-ing is in the South Island we are still seeing some growth in the North Island and we want to be able to pro-cess extra milk in a way that provides the most value to our farmers.”

The proposed drier will be similar in size to one at the co-op’s recently

opened $200 million Darfield plant in Canterbury.

Taylor says the third pant at Pahia-tua will help increase efficiencies. It will also create another 45 jobs.

The co-op has looked into a number of possible locations in the North Island to expand processing capacity and Pahiatua’s proximity to good infrastructure such as a nearby port and rail lines have made it a good option.

“We’ve done some initial plans and believe we would be able to build a drier which uses the latest technol-ogy so wastewater could be treated and irrigated to neighbouring land. It would also be the first in the country to reuse its own condensate.

“These are early days and our first priority is to talk with the local com-munity before any formal decision is made,” he says.

Brent Taylor

two opotIKI dairy farmers, Ian and Geoffrey Brown and their company Riverlock Farms Limited, have icurred a $74,000 fine, plus costs for discharging underpass liquid to waterways in 2011. The company is said to be one of the largest dairy farming operations in the Bay of Plenty, milk-ing about 2500 cows.

The Bay of Plenty Regional Council, which took the prosecution, says the pair were charged with pumping underpass water containing contaminants directly into a roadside drain on October 18, 2011. The drain led to the Waioeka River via a tributary stream. The second dis-charge occurred when wastewater from a nearby effluent pond overflowed into the same drain. The third charge related to the company failing to comply with a court order to obtain a report about the farm’s contingency plans for effluent management.

Bay of Plenty Regional Council operations, monitoring and regulation committee chairman Malcolm Whitaker said the level of the fine reflected the deliberateness of the discharges. “One year earlier the defendants pleaded guilty to offences relating to two unauthorised discharges of effluent at the same property. A conviction on the breach of this previous enforcement order was necessary as the need to comply with a court ordered direction is imper-ative. The company has spent in excess of $330,000 on upgrading their effluent system on the farm which was reflected by the council not seeking a fine for that partic-ular offence,” he says.

But Whitaker says the conviction for the wastewa-ter offences signals that discharges of this nature are not acceptable, particularly on farming operations of this size.

“The regional council is concerned that some dairy farmers running large herds are not paying enough atten-tion to managing the farm’s effluent system properly, to the detriment of the environment. We are seeing cases where farms have expanded their operations without sub-sequent investment in infrastructure upgrades.”

Whitaker says many resources are available to farmers on effluent management through Fonterra and DairyNZ.

exports lift, prices divedAIrY eXPOrT volumes rose 32% but prices were down 13% in the September 2012 quarter, says Statistics New Zealand.

The New Zealand dollar had the biggest effect on export prices with the reserve bank trade weighted index rising 2%. milk powder was down 14% in the September 2012 quarter and butter down 17%.

In the year to the September dairy prices dropped 21% compared to a 4.2% decrease in the year to the September 2011 quarter.

“dairy export volumes are at record levels, after adjusting for seasonal effects,” Statistics NZ prices manager chris Pike says.

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Ex-Fonterra man to retiremondeleZ Inter-natIonal, formerly Kraft Foods, execu-tive Sanjay Khosla will retire early next year.

Khosla, 61, exec-utive vice presi-dent and president, developing mar-kets, will continue to work with the company through the end of 2013 in a consulting capacity to Mondelez Inter-national’s leader-ship development programs.

Khosla joined the company in 2007 after a stint with Fonterra as the managing director of its brands business. Since joining Mondelez, Khosla and his colleagues have doubled the business through organic growth and more than tripled it after acquisitions,

while also improving profitability. Its US$16 billion revenue represent about

44% of Mondelez International’s 2011 net revenue.

“Having built our developing mar-kets business into the growth engine of the company and a criti-cal part of our global portfolio, Sanjay and I have been discussing since last year the best time for him to retire to

pursue his passions for teaching, writing and board work,” says Irene Rosenfeld, Mondelez

chairman and chief executive.

“With the spin-off completed and our new company success-fully launched, we’ve agreed that now is the right time.”

Khosla says he’s pleased to be leaving the company having largely accomplished the challenge Rosen-field put before him in

2007.“ I’m especially

proud of the tremen-dous talent we’ve developed through-out the organisation. Indeed, the people who will continue to lead the regions have earned their promotions. And I’m confident they will drive top-tier growth going forward.”

Cheese sandwich on the chopping block?a uK health lobby is under fire for highlighting salt levels in cheese and suggesting lower sodium targets for manufactur-ers.

CASH (Consensus Action on Salt and Health) looked at 772 cheese products available in UK supermarkets and found many were unnecessarily high in salt.

Graham MacGregor, CASH chairman and Professor of Car-diovascular Medicine at the Wolfson Institute says cheese is still a big con-tributor of salt in the diet. “We urge the government to stop dragging its heels and set new, lower, targets for cheese manufacturers to work towards.”

However, the UK Dairy Council dis-agrees, its director Judith Bryans saying the survey reveals a lot of what is already known: different types of cheese con-tains different levels of salt. Some are lower and some are slightly higher.

But it’s wrong to draw the health conclusions CASH does, she says.

“The survey is mixing up the effect of cheese on health with the effect of salt on health. Cheese is a whole food with a complex nutritional make-up not shown to cause heart disease or stroke. The National Diet and Nutrition Survey shows that cheese contributes only 4% of the nation’s salt intake.”

She says the council does not think it is constructive to send out a message that a cheese sandwich is not good for you.

“Cheese provides a wide range of nutrients including protein, vitamins and important minerals such as cal-

cium. To reduce cheese for its salt content is not accept-able. People have been eating cheese sandwiches… for many years…. Cheese and dairy are important in a healthy diet.” It is bought by at least 98% of households.

Cheddar, though not the saltiest variety of cheese in the survey, was found to con-tain more salt than a packet of

crisps – average 0.52g salt/30g portion.MacGregor says even small reduc-

tions will have large health benefits. For every one gram reduction in population salt intake we can prevent 12,000 heart attacks, stroke and heart failure, half of which would have been fatal, he adds.

“The Department of Health must now stop its delaying tactics and set new much lower targets for cheese manufacturers, and make sure they achieve them. The cheese industry must comply if we are to save the max-imum number of lives.”

Sanjay Khosla

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Fonterra is Oz’s top butter maker

world // 21

SUNGOLD JERSEY milk from Warrnambool Cheese & Butter Factory won the champion milk title at the 2013 Australian Grand Dairy Awards (AGDA).

The judges said: “This is how milk should taste; sweet, fresh and an absolute delight to drink. The texture produces a full-bodied mouth-feel with a clean aftertaste.”

Sungold Jersey milk is collected from pure-bred Jersey cows first introduced to Australia in 1829, and known for turning out high-fat, high-protein milk.

The milk is supplied from farms in south-west Victoria. In 2012, Sungold Jersey milk claimed gold awards at the Hobart and Ad-elaide Royal Agricultural Shows.

best mIlK award

Fonterra Is offi-cially the best butter maker in Australia. The co-op’s Western Star Origi-nal Butter last month won the champion butter at the 2013 Australian Grand Dairy Awards (AGDA).

Western Star, owned by Fonterra Brands, origi-nated in Victoria’s western district when the Cobden First Dairy opened in October 1888. Winning the same category in 2009, Western Star Original Butter remains a classic, the co-op says.

The judges noted West-ern Star Butter “shows a

good closed, compact tex-ture with an even pale, yellow colour…. A good salt balance with a hint of nuttiness, and the sweet, fresh flavour is outstand-ing.”

The grand champion cheese title was won by Tasmanian Heritage, the makers of St Claire, a Swiss-style cheese. The maker started in 1955 when Swiss cheese makers were invited to bring their craft to north-west Tas-mania, a region with geo-graphical similarities to Normandy in France.

The judges noted

St Claire is an excellent example of a modern Swiss-style cheese, “exhibiting perfect eye formation and distribu-tion essential to the development of the sweet, nutty and complex flavour these cheeses are admired for”.

The grand champion dairy product award was given to Bulla premium sour cream from Bulla Dairy Foods, Victoria. This also won the cham-pion cream class in 2006, 2008 and 2011. It contains 35% milk fat, so it retains its shape longer. The judges said it is fine and clean acidity with a good tex-ture and a great balance of creamy flavours. “This product exhibits just the right amount of

acidity for sour cream.

The tex-

ture is silky smooth.” The champion ice

cream in Australia is Dool-ey’s licorice ice cream, made by Dooley’s Ice Cream at Apollo Bay store, Victoria, by Dooley Milner and his daughter Alyci-andra.

Dooley’s churns out 300L of ice cream every 24 hours, operating since 2002. Raised on a dairy farm in Warragul, Milner left home in his early 20s to establish his own dairy at nearby Drouin and

then started working in the ice cream retail busi-ness. Dooley’s has won a number of awards, includ-ing the inaugural Pre-mier’s Trophy at the 2010 Royal Melbourne Fine Food Awards. The judges said the ice cream displays a fine lic-orice flavour combined with a superb texture that all premium ice cream makers would aspire to. “The excellent licorice fla-vour lingers nicely on the palate,” the judges said.

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Top ice cream maker... Dooley Milner with his award.

Western Star Butter, from Fonterra Brands, took out the top award.

WCB’s Paul Pino with the award.

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Head Office: Top Floor,29 Northcroft St, Takapuna,Auckland 0622 Phone 09-307 0399. Fax 09-307 0122

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Dairy News is published by Rural News Group Limited. All editorial copy and photographs are subject to copyright and may not be reproduced without prior written permission of the publisher. Opinions or comments expressed within this publication are not necessarily those of the staff, management or directors of Rural News Group Limited.

ABC audited circulation 27,478 as at 30.6.2012 ISSN 1175-463X

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THE NEWS that Landcorp’s chief executive Chris Kelly is plan-ning to hang up his gumboots next July engenders a sense of regret; it will take a special person to fill those Red Bands. His contribution to the primary sector is immense and he has given a lifetime of service to agriculture.

He was a successful veterinarian, a lecturer and private com-pany executive before joining the Dairy Board where he held a variety of senior posts including strategic planning manager.

His role as chief executive at Landcorp, held since 2001, is huge. Arguably he manages the biggest agricultural business in the country: 1.5 million stock units on 119 separate farms. Under his watch, a raft of innovations have taken place includ-ing improved genetics, better environmental management and wireless broadband for all farms. He has shown real leadership, adopting and applying appropriate new technology.

In the last year or so, Kelly has been deeply involved as one of the deal makers in the sale of the Crafar farms. His astute leadership in helping to clinch this deal is widely recognised.

The Chinese clearly felt comfortable having a quasi-gov-ernment agency – Landcorp – as their business partner. From Landcorp’s point of view it also made perfect sense. They are already in a similar arrangement with the New Zealand-owned company Wairakei Pastoral and their farms in the central North Island are virtually next door to some of the ex Crafar proper-ties. The synergy between the two operations is obvious.

While Kelly can mix it with the best of the corporate chief executives and academics, he has never lost the earthiness one expects of a vet who knows what life is like in the country, on the land and in the dairy shed. This ability to mix freely and easily in both worlds sets him apart.

One final accolade for Kelly: he is a brilliant communicator who talks freely and openly to the media and encourages his staff to do the same.

His own confidence in this area and his trust in his staff to interface with journalists has done much to enhance the rep-utation of Landcorp.

A great guy

Got somEthinG on your mind?

post to: Letter to the editor po Box 3855, AuckLAnd 1140. or emAiL: [email protected]

GOT SOMETHING on your mind about the latest issues affecting our dairy industry? Put your pen to paper or your fingers to your

keyboard, and let our readers know what you think. Contact us by either post or email. Don’t forget to put your name

and address. Note: Letters may be edited.

poor prDAIRY NEWS’ sister publication Rural News last week ran a story that essentially said New Zealand farming could be better represented in the eyes of the public� Environment Minister Amy Adams was quoted saying farmers were not always perceived well in New Zealand despite being the economic engine of the country� Milking It couldn’t agree more and reckons representative bodies such as the Feds and DairyNZ should do better at media engagement�

there lurks a ghostNOT OFTEN does Milking It take a literary turn, but Fonterra’s choice of a bell to mark the start of trad-ing in its units brings to mind the words of Shake-speare’s Macbeth after the murder of the king, Duncan: “The bell invites me� Hear it not, Duncan, for it is a knell that sum-mons thee to heaven, or to hell�” What’s the betting some anti-TAF shareholders would like to substitute the name Henry for Duncan?

was that the sound of a cowbell?TALKING OF bells, couldn’t Fonterra have produced something a little more impressive than the pint-sized effort used to launch TAF? Any-one who’s ever seen (or heard) an Alpine ski race in Europe will know the Swiss do some super-size cow bells which make an impressive clang-clang-clang� Something akin to one of those would have been appropriate for such a milestone in the coop-erative’s history� As it was the tame tink-tink-tink was more like a school-child’s triangle�

please explainIS A partial listing of Fonterra still doing the rounds of the Beehive? Prime Minster John Key, chief guest at the open-ing of Fonterra’s Darfield plant last month, referred to the launch of TAF earlier that morning as a “par-tial listing of Fonterra”� Fonterra leaders insist TAF concerns redemption risk, not eroding ownership and control of the co-op� Does the PM know something we don’t?


tHe taF (trading among farmers) scheme and the Fonterra Sharehold-ers Fund have morphed, on opening day, to ‘trad-ing amongst institutional investors’ and ‘the insti-tutional investors fund’. Despite the Fonterra chair-man’s countless assur-ances to the effect that “TAF does not bring extra capital into Fonterra, it’s all about farmers trading among farmers” – in real-ity we have the opposite.

Only 260 (2%) Fon-terra farmers want to trade less than 0.5% of Fonterra shares on issue.

So, in order to create this Fonterra Sharehold-ers Fund, Fonterra will issue, at Fonterra share-holders expense, 470 mil-lion of the $500 m fund. All the while they refer to a “minor” dilution of the dividend of 1c (I calculate that if you add $500 m to a market capitalisation of $7.5 b, you dilute a 6%/30c dividend by 2c – a 7% dilu-tion of earnings).

This is a perma-nent effect, along with the effect on the under-lying intrinsic value of the shares that Fonterra neglects to mention.

Those farmers forced to share up at $6.79 when Fonterra was being pre-pared for sale in 2007 will not be impressed to see their capital contri-butions offered direct

to institutional in inves-tors – including the Chi-nese Government – at a discount. For what ben-efit? To accommodate those who want to trade less than 0.5% of Fonter-ra’s shares on issue? This is a capital raising. Nearly 100% of the fund is new capital for Fonterra.

Yet I observed our chairman submit to the DIRA select committee that this was not a capi-tal raising and brought no extra capital onto Fon-terra’s balance sheet. The farmers will sell their eco-nomic rights and the capi-tal will go on the farmers’ balance sheets, we were promised.

This scenario was of course totally predict-able. Why would farm-ers release economic rights at the current share price when the book build should drive it upwards, at least temporarily? – apart from the very few who may have been forced to sell now by their banks. We could only ever have had a scenario where the shares were going to be issued by Fonterra – a cap-ital raising.

Of course farmers will release their shares when the economic drivers push them there at a later date. But the capital raising will have been achieved by then: $470 m of non-milk-backed equity contributed to Fonterra by institu-tional investors, all to accommodate the small-

est minority who have had to trade.

Fonterra is quoting farmer application for units as an ‘expression of confidence’. The farm-ers or sharemilkers I have spoken to are applying for units out of fear they will not be able access them at a reasonable price once the volatility begins and the traders ‘discover’ the share price. So, we have created an opportunity for:

Fonterra to shift capi-tal redemption risk off the company balance sheet, and onto the farmer’s bal-ance sheet.

More attractive oppor-tunities to exit Fonterra

particularly after the frenzy created by the book build.

Significant barriers to entering Fonterra now as farmers must com-pete with institutional investors for their ‘alloca-tion’ and those consider-ing converting to dairy are unable to budget now on the cost of joining Fon-terra. Who will sign up to supply when they need to consider the share might cost them $5-15?

Which brings me to the second absolute about-turn by our board on their assurances to farmers: while the board insisted a $500 m fund was needed for “fungibility and liquid-ity to discover the share price”, numerous farm-ers brought up the con-cern that the market will

now determine the share value, creating potential barriers to entry. As these concerns were raised at meetings, the chairman did a 180-degree turn and claimed

that, because the farmer market is the larger market, the farmer would determine the share price. So which is it: we needed a $500 m investor fund for price discovery, or we had it already? It is obvi-ous those trading in the units will set the price. The chairman’s claims to soothe those farmers’ fears were unrealistic. The small cog drives the big cog and those trading in the unit fund will set the share price.

We have TAF now; I bring up these exam-ples of the about-turns so that farmers go into their co-op’s annual meeting with their eyes wide open. We have mitigated an over-exaggerated capital redemption risk by means of a much more serious supply redemption risk. An exporting co-opera-tive’s strength lies first in keeping its milk vats full.

It is following this mis-informed guidance from our leadership – that we now hear from the board – that farmers should vote against a resolution to tighten farmer control on the board.

Any farmers concerned

Heads full of rocksleonIe guIney

about differences between what they were sold and what was actually deliv-ered should exercise their democratic rights by sup-porting the McKenzie and Jones remit.

A second handbrake available to farmers is to vote in favour of the reso-lution that relates to con-trols on the fund size – the resolution that the coun-cil promised was a prereq-uisite of their support for TAF, yet was not in place when TAF was launched.

A third handbrake is in the hands of MPs: to leg-islate a limit on the fund size before the inevitable combination of low com-modity prices combined with higher interest rates

at some point puts the squeeze on farmers and forces them to beg for a bigger fund.

When that happens, unless the limits are set in concrete, we can wave goodbye to our current collective strength. Then we will disintegrate to the meat industry model: a

dismantled Fonterra that delivers local ‘competi-tion’ so desired by our minister of agriculture. Then, in reality, one would have to have rocks in one’s head not to know that our competition is offshore, not within New Zealand.• Leonie Guiney is a South Canterbury farmer.

“I bring up these examples of the about-turns so that farmers go into their co-op’s annual meeting with their eyes wide open.”

Some Fonterra shareholders want TAF limits set in concrete to maintain its collective strength.

opInIon // 23

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Westland board welcomes fresh faces

maJor growtH in its milk powder ingredients business saw Canterbury’s Synlait Milk post a $6.3 million after-tax profit in its fourth year of opera-tion.

The company paid its milk suppliers a total aver-age milk price of $6.22/kgMS.

The company had a turnover of $377 million in the year to July 31, 2012, an increase of $78 million on the previous year.

Chief executive John Penno says the devel-

opment of the compa-ny’s new adult and infant nutritionals business holds exciting prospects. However it has been its value-added and con-sumer-ready milk powders business that delivered the strong financial result last year.

“We were pleased to achieve a solid profit while providing a com-petitive milk price to our milk supply partners,” says Penno. “It is even more pleasing this came about in a year when our volume

of ingredient powders has grown by 50% and we were commissioning our new infant formula capa-ble drier.”

The company’s milk volume grew from 343 m L in 2011 to 498 m L in 2012,

with 40 new farms being contracted for supply. The additional milk processed lifted manufactured vol-umes from 54,414 t in 2011 to 81,398 t in 2012.

In 2012 Synlait Milk expanded its operation to

Synlait posts $6.3m profit

include a purpose-built infant formula plant. The company also upgraded its existing spray drier to allow for the production of growing-up milk powders, and its special milks drier was upgraded to produce high-value milk protein concentrate.

“We remain com-mitted to our strategy of developing our value-added and nutritional milk powder business, and building a reputation for quality and technical excellence. Current per-formance confirms our view that the margins pro-vided in these demand-ing market segments will be critical to Synlait Milk’s future,” says Penno.

“The company is now positioned at the premium end of the highest value milk protein markets,” he says.

tHe board of Westland Dairy Prod-ucts has two new directors following the Hokitika cooperative’s annual meeting late last month.

Bede O’Connor, Westport, beat incumbent Jon Sullivan for a general director seat while Kirsty Robertson, Hari Hari, won a two-way election in the southern ward where Jim Wafel-bakker was standing down.

“They’re big shoes to fill,” Rob-ertson admitted to Dairy News last week, reflecting on Wafelbakker’s 25 years on the board.

She and husband Gordon moved to Hari Hari in 2007 to buy their first farm, having sharemilked in southern Waikato for nine years previously. “Now we’re here we wouldn’t want to be any-where else… It’s really refreshing to be part of a smaller co-op.”

Standing for the board was some-thing she’d been thinking about for

some time and with Wafelbakker stand-ing down, good staff on their farm, and their younger daughter having started at boarding school, the time was right, she says.

“I think one of the biggest challenges facing Westland is the successful imple-mentation of the strategy and ensuring suppliers understand and support the direction of the company. Westland is

moving beyond what it’s done in the past when the focus was very much on commodity products. Now it’s very much more value-add.”

Robertson’s previous governance experience is in local community/sports committees and involvement with organisations such as Dairy Women’s Network. She is currently in the West

Coast leadership and governance pro-gramme.

Fellow board newcomer O’Connor is also on that programme. “I’m very strong on the fact Westland is an inde-pendent co-op,” he told Dairy News after his election. “Basically farmer shareholders are the ones who should be rewarded from the cooperative’s activities, first and foremost.”

O’Connor bought his family’s 320-cow farm last year having farmed it since 2006-07, and in the 1990s after graduating from Lin-coln. In between he had five years in Auckland as a con-

tract supervisor installing fridges in supermarkets.

“It was probably my OE, living and working in Auckland for five years. It increased my organisational and com-munication skills, dealing with contrac-tors and all sorts of people in all sorts of areas to make things happen. It was very good experience for me and I was def-

initely outside my com-fort zone for a while.”

Westland’s “very loyal shareholder base combined with very loyal staff,” are one of its key strengths, he believes.

“For 15 years we’ve produced very high qual-ity milk powder and as we move into the nutri-tional space these skills are being transferred.”

Inevitably, as a company grows, there will be challenges, and “going into Canterbury” is one of those, he adds. “We are in Canterbury now and we’ve got to make the best of where we are and turn it into a positive.”

As for the threat of Fonterra seek-ing suppliers on the West Coast, the cooperative has to be alert to it but he believes developing and delivering on Westland’s value-add, nutritional strat-egy should keep current and future sup-pliers loyal.

O’Connor’s father John was a found-ing Westland director of 1987, having served on the boards of the Karamea and Buller dairy cooperatives prior to that. O’Connor’s older brother is Labour MP and agriculture spokes-man Damien O’Connor.

Westland chief execu-tive Rod Quin says both

new directors represent the solid and practical base of West Coast dairy farm-ing.

“I fully expect they will be active con-tributors to the discussions on the com-pany direction as it seeks to improve shareholders’ incomes by moving increasingly into the more stable and higher value nutritionals market.

“It’s an exciting period for the com-pany but one that also presents some real challenges. I look forward to their input,” says Quin.

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“I’m very strong on the fact Westland is an independent co-op.” – Bede O’Connor

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In wellIngton for The Hobbit launch, a Los Angeles business consul-tant friend told me that in the 1970s he had lived in a housing cooperative, and how much he had enjoyed the experi-ence. But today, he said, many cooper-atives are like corporates. As an example of a co-op that had gone bad, he sug-gested REI – a US chain of outdoor rec-reation and sports goods stores.

I couldn’t agree with him less.Recreational Equipment Inc (REI)

is a consumer-owned cooperative. Its 11.6m members bought one $20 share in the business to join the co-op, and

this entitles them to annual rebates on their purchases, in proportion to how much they buy from the co-op. This year, almost $100m was rebated to 4.7m members.

Generating 2011 revenue of US$1.8bn, REI has 127 stores in 31 states, an online store and a catalogue business. Co-op members and staff do what they can to ensure the outdoors is accessible and respected by all. “It’s the right thing to do, and it’s a whole lot of fun,” says REI.

“Being a consumer co-op, rather than a publicly traded company, enables us to focus on the long-term interests of the co-op and our members. We answer to you – our members – and run

our business accordingly. And it means that we’re able to operate a business that plays a national role in growing out-door participation and protecting the environment for future generations.”

However, with 11,000 employees and a chief executive whose salary is at least US$1m, this means REI is a ‘corporate’ rather than a co-op, according to my friend. I strongly disagreed.

A ‘corporate,’ I countered, is char-acterised by the limited liability of its owners, the issuance of shares, and exis-tence as a going concern, rather than

the number of employees and the size of the chief executive’s pay. To my way of thinking, all New Zealand co-ops are therefore ‘corporates’.

Incorporation, the process of becoming a cooperative company, gives a cooperative separate legal stand-ing from its owners and protects those owners from being personally liable in the event that the co-op is sued.

What a cooperative is not, though, is an investor-owned firm. And this is what my LA friend’s former housing co-op has in common with REI and all

other large, successful cooperative busi-nesses.

Cooperatives are owned by mem-bers and operate for the benefit of those members, who transact with the co-op either by selling to it (dairy co-ops) or buying from it (as in REI).

REI, incidentally, has been on the Fortune 100 list of Best Companies to Work For every year since 1997, rank-ing at #8 in 2012. Seems like a reason-able business to me.• Ramsey Margolis is executive director of the NZ Cooperatives Association.

dAi ry nEws december 11, 2012

26 // agrIbusIness

Cooperatives, corporates and investor-owned firmsramsey margolIs

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agrIbusIness // 27

NZ season at play in world milk pricelast montH I took a broad look at the Austra-lian season so far. Most farmers – particularly in export-oriented regions – have received at least one increase in their farmgate price, due in large part to a recent recovery in global dairy commodity prices.

While prices of all commodities have firmed and markets are currently in good balance, some pat-terns have emerged that reflect the global dairy sit-uation.

Prices on the Global Dairy Trade (GDT) online auction platform have increased 20% since the beginning of the 2012-13 Australian season in July, with the average whole milkpowder (WMP) and skim milkpowder (SMP) prices rising by 19% and 31% respectively.

While traded volumes vary, WMP and SMP make up around three quarters of the volume of prod-uct traded on GDT. Aus-tralian exporters suggest price rises of 15% and 21% for WMP and SMP respec-tively, while cheese prices have remained steady – increasing just over 1% since July.

Whilst cheese prices

are generally slower to move in either direction than those of the powders, the difference in dynamics between WMP and SMP is of interest.

Other sources pro-duce different figures, but the patterns are similar globally. Rapid increases in both WMP and SMP prices during the July-Sep-tember period have given way to a period of price stability during October and November, as global supply and demand have been well balanced.

SMP however, has risen faster and remained higher than WMP for most of the season to date, despite its historical propensity to trade at a discount.

To illustrate, Dairy Aus-tralia monitoring shows SMP has traded at a higher average price than WMP for only 19 out of 120 months in the last 10 years – and four of those have been this year.

Geographic differences in supply are at play here. The leading exporters of SMP are the EU and US, which each ship about 30% of the world’s traded SMP. Farmers in these two mar-kets have faced severe and well documented hard-ships over the past few months, with adverse cli-matic and economic fac-

tors including drought, floods, high feed prices and low milk prices cur-tailing milk output.

Despite the end of the drought in the US and some recovery in farmgate prices, grain prices remain elevated and heavy cull-ing is continuing to reduce the number of cows avail-able for production in the coming season.

Similarly in Europe, farmers relying on pur-chased feed inputs are experiencing poor pro-duction margins, having emerged from a summer that was far too wet in the UK and Ireland; and too hot across much of conti-nental Europe.

By contrast, about half of the world’s WMP exports originate from New Zealand, where above average in-calf rates and herd retention have produced rapid supply growth during the first few months of their 2012-13

production season (which begins in June).

Building on a bumper 2011-12 season, data to September shows produc-tion up by about 8% so far this season, although few expect this rate of growth to last the full 12 months. Local sources suggest pro-duction has peaked early, and expectations are the second half of the season will see output trail the huge volumes recorded in the latter months of the 2011-12 production year.

Notwithstanding the expected slowing in New Zealand growth, the strong season so far has been enough to keep WMP prices from increas-ing as fast as those of SMP. Whilst strong purchasing – particularly by China – has kept up with seasonal increases in WMP supply, the continuing level of Chinese purchases over the next few months is seen as a key factor (along with the resilience of New Zealand output) that will define the direction of WMP prices into early 2013.

Australia benefits from a balanced product mix, with about a third of milk going to cheese produc-tion, 28% to the SMP/butter line, and 11% to WMP (the rest is pro-

cessed as drinking milk or other low volume or specialty products). This has diversification ben-efits in not overexpos-ing industry returns to one product, but the ben-efits are limited by the linkages between dairy commodities, and the abil-ity of buyers to substitute in favour of the cheaper

alternative. So while New Zealand production poten-tial affects WMP pricing in particular, it also has wider implications.

Australia’s dairy pro-cessors themselves vary in their product mix and therefore their potential to exploit or suffer from such pricing quirks; however the healthy competition

for milk supply that exists in most export regions suggests that while WMP might lead the market in the coming months, for farmers, it’s ultimately the overall market movement (and the exchange rate) that counts.• John Droppert is a market analyst with Dairy Australia.

JoHn droppert

John Droppert

The average whole milkpowder and skim milkpowder prices have firmed.

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28 // management

New tools simplify farm performance, analysisanalysIng and understanding farm accounts is now easier with DairyNZ’s introduc-tion of simple graphs and charts to its DairyBase system; these show how a farm business is perform-ing.

Nearly 2000 dairy farms are now registered in DairyBase, launched in 2006.

DairyBase manager, Dr Adam Barker, says over the last few years, Dairy-Base has really come into its own with farmers gain-ing huge value from the system.

“The changes we’ve recently made to Dairy-Base provide simpler ways to analyse and understand a farm’s performance with the addition of easy-to-read graphs and charts and

a new, cut-down analysis,” says Barker.

“We’re helping farmers analyse operational farm performance without the complexity of the entire balance sheet. The new additions to the system mean farmers can quickly pinpoint areas of good and poor financial perfor-mance including profit per hectare, liabilities and cashflow.”

DairyBase helps farm-ers analyse the resources they have and the way they are using them. By way of benchmarking, it also compares the use of resources with other farm businesses. It is avail-able to all dairy farmers through levy funding.

Morrinsville farmer Brendon Van Vugt has been using DairyBase

for three years. He is an owner/operator milk-ing 570 cows on 170ha between Gordonton and Morrinsville. He started using the DairyBase prof-itability analysis on advice from his accountant, Nigel McWilliam of Diprose Miller.

Van Vugt says he has used other systems that tried to do the same thing but, unlike DairyBase, they were complicated.

“DairyBase recog-nises that financials aren’t a farmer’s core business – and that’s why a lot of farmers don’t bother with these types of systems. But, the new graphs and charts are really visual, simple and easy to under-stand.”

He has talked to his banker about lending

using the reports, and he showed his reports to his local discussion group to demonstrate how easily and effectively the reports measure profitability.

“If you’re doing things a little differently, people will question whether or not it’s profitable. The DairyBase profitabil-ity report goes beyond milk production or kg/ha and kg/cow. It tells you whether what you are doing every day is improv-ing your bottom line.”

Barker says the top benefit of DairyBase is that it gives farmers and their advisors the information and analysis they need to have well-informed dis-cussions about farm per-formance.

“They can discuss topics such as achieving

short and long-term goals, opportunities to improve operations, how they stack up against other farms, whether their farm work-ing expenses are in line with similar farms and what decisions need to be made to improve their life-style.”

Barker went on to say that DairyBase is not only providing value on farm, but to the wider industry as well. “Through DairyBase, the industry now has this huge repository of physical and financial information about a statistically robust sample of New Zealand dairy farms. This has allowed DairyBase to contribute data and statistics to a range of national and international research studies and

reports related to the New Zealand dairy industry.”

Barker emphasises that DairyBase keeps individ-ual farm information con-fidential and statistics are only ever provided in a nameless and unidentifi-able manner.

DairyBase contrib-utes industry and seasonal commentary to the indus-try’s annual Economic Survey and provides the foundational information for DairyNZ’s calculation of the Profit from Produc-tivity (PFP) measure.

As well as contributing to industry monitoring,

DairyBase has provided information to research projects covering topics including the factors influ-encing volatility on farm, on-farm risk management practices, organic dairy-ing management practices and development of meth-ods to allocate nutrient losses.

DairyBase has also pro-vided data to the Interna-tional Farm Comparison Network, an organisation which releases an annual report on milk production worldwide.Tel. 07 858 3890 www.dairybase.co.nz

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delaval launcHed two products recently, hoping to attract dairy farmers the lower payout. The products are a super-large milk filter and a ‘clip-on technology’ rotary milking platform.

The new shed, the PR1500 is modular in design and according to DeLaval’s Solutions manager for conventional milking systems, Gareth Johns it can provide a range of options to suit a farmers specific needs.

Setting this new system apart is that it can take a customer anywhere on their journey or needs. Farmers don’t need to buy a bells and whistles system immediately.

“They can start with a very simple system with no technology and then they can add on things. These can include automatic cup remov-ers, animal identification on the rotary plat-form, in-parlor feeding, milk recording and technology that drafts cows from the bail,” he says.

Johns says the clip-on system means that farmers can ‘future proof ’ their new dairy shed without having to outlay huge amounts of capi-tal at the outset. They would once have bought a very ‘low tech’ system or a ‘high tech’ one with nothing in between which he admits was effec-tively a ‘product gap’.

The new platform design was developed in New Zealand and was based on input from farm-ers, DeLaval dealers and the companies techni-cal staff in Hamilton. Johns says this works very well and brings a good balance into the design. “You may get a situation where what a farmers wants is impractical to make, then you can get to the other extreme of a dealer and engineer who favour an elaborate creation. By having the three inputs we get decisions made on factual

rather than emotive grounds.” Two test sheds have been built:

one near Whanganui in the North Island and other in South Canterbury. Johns says both are working well.

Another feature of the new rotary is the bail width size option. It can be either 680 or 730. In the case of the latter option being chosen, the actual bail itself is lengthened to accommo-date the larger cows.

Johns, responsible for South Africa and Australia as well as New Zealand, says the PR1500 has potential over-seas. But he says it’s likely farm-ers there will want the larger bail size. Price of a new PR1500 will vary depending on the technol-ogy that’s bought and Johns says it can start at around $1600 per bail and go up to about $3000.

management // 29

Clip-on automation a winner

a dealer’s vIew

KEVIN FOLEY, DeLaval dealer from Opunake, Taranaki, was one of 30 staff and dealers at the product launch. He forsees good demand for the rotary given its ‘clip-on’ fea-ture and ability to ‘future proof’ the shed in technology terms.

Foley says the new concept and the way it’s priced allows farmers to put in a rotary and not spend a

heap of money on full automation. “Whereas in the past we would

have had a full cabinet bail without any other options, now the farmer can put the basics in at the start [without needing] to worry about putting in automation if he doesn’t want to.

Later he can step up to the full automation – the selling point.”

tHe drIver for the development of the MF100 milk filter, says Gareth Johns, was a change in NZCP1 (code of practice for dairy farm construc-tion and equipment).

This is administered by the NZ Food Safety Authority which in Octo-ber 2010 changed filtering require-ments for the surface area of filter

socks, based on cow numbers.All filters on the market were at

that time evaluated and given a ‘cow rating’. Even filters that may previ-ously have been acceptable for 600 cows were rerated for about 400 cows.

“This created a need and an oppor-tunity to create a large capacity filter

capable of doing 800 odd cows. Traditionally we would have

banked filters up… two filters if you had 800 cows. We wanted to avoid that and get a single filter for a set number of cows, [hence] the birth of the MF 100 which caters for 880 cows and is the biggest filter on the market,” he says.

Standards drive change

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30 // management

Good cultivation pays offusIng good cultivation practices helps farmers protect both the finan-cial and environmental bottom lines of their properties.

Post-winter is the time when farmers are cultivating their paddocks to ensure they can best provide fresh pasture or the next crop. Also, so-called ‘sacrifice paddocks’ are normally cultivated about now and sown with a summer crop to restore damaged soil. As farmers go about this work, there are a number of factors to bear in mind to maximize farm efficiency and minimise their envi-ronmental footprint.

Sediment and nutrients from farm-ing operations, along with erosion gen-erally, are some of the important causes of reduced water quality in our region. Although much of the Waikato’s 2.5 million hectares is relatively stable, the national land resources inventory has identified at least one million ha affected to some degree by erosion, with erosion on almost 36,000ha ranked as severe to extreme. A further 400,000ha is classified as having severe erosion potential.

Topsoil erosion, especially in hill country, of bare or culti-vated land, leads to the loss of valuable nutrients. It can also disrupt infrastructure and increases the costs of mainte-nance activity, such as cleaning culverts and drains.

The greatest risk can be at times such as now when the protective plant cover is lost through cultivation of soils for pasture renewal and crop establishment. Even with well-established shelterbelts protecting paddocks, wind ero-sion can still occur because of inappropriate cultivation tech-niques.

Farmers with lighter soils should consider ‘conservation cultivation’ measures. These are cultivation prac-tices aimed at maintaining maximum vegetative cover on the soil surface and which encourage moisture retention in soils. The aim is to produce an uneven soil surface in as ‘rough’ a condition as practicable and to restrict the cultiva-tion period to the minimum time.

The use of the chisel plough or grub-

bers is recommended as these give a fine deep seedbed while still retaining a cloddy surface. Top-working imple-ments, discing and rolling can create a fine seedbed prone to erosion even in well-sheltered situations. Contour cul-tivation, sowing at right angles to the prevailing wind, sediment retention, and reducing runoff are recommended for minimising soil loss.

Soils should be cultivated when the

moisture content is nei-ther too high nor too low. To assess if soils are suit-able for primary cultivation, take a piece of soil (half the volume of an index finger) and press firmly to form a pencil. Roll the soil into a ‘worm’ on the palm of one hand with the fingers of the other until it is about 50mm long and 4mm thick. Exert sufficient pressure with your fingers to reduce the diameter of the worm to 4mm in 15-20 complete for-ward-and-back movements of the fingers. Conditions are suitable for cultivation if

the soil cracks before the worm is made. The soil is too wet to cultivate if you can make the worm. Clods that are too dry won’t break down with cultivation to give a good seedbed.

Satisfactory results are achieved when cultivation is carried out at a suitable soil moisture content and at a suitable depth. If good precautions are observed, a two-pass cultivation is needed to prepare a seedbed.

Other conservation cultivation tech-niques include minimum tillage or no tillage – the least cultivation possible or none at all to reduce soil disturbance. If soil has been continuously cultivated for many years, the structure is likely to be poor because cultivation reduces soil organic matter levels. No-tillage will not repair the damage overnight but, with residue retention, it will eventually. Chemical spraying followed by direct drilling is an option on light erodable soils.

A range of material from adjacent land can contaminate watercourses. This can include sediment, nutrients such as nitrogen and phosphorous, other chemicals and microbes.

Sediment and some nutrients, par-ticularly phosphorus, are carried to streams primarily in the overland flow of water. Dissolved nutrients such as nitrogen and other materials (includ-ing dissolved organic carbon) can also move through the soil in underground flows and contaminate watercourses.• Bala Tikkisetty is a sustainable agriculture coordinator at Waikato Regional Council. Tel. 0800 800 401 or email [email protected]

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management // 31

Move early against mastitisdaIrynZ’s smart-samm scheme offers a new regime for prevent-ing mastitis in dairy herds. The first to access this new Mastitis Focus Report-ing system are farmers herd testing and recording on CRV Ambreed’s new

Insight programme. “DairyNZ and CRV

want to help farmers more easily identify mastitis and reduce somatic cell counts in their herds,” says CRV information product man-ager Henk Huurnink.

The Mastitis Focus

wItH early predictions pointing to a long hot summer, forages are going to play an important role in farmer’s feed management plans, says Pacific Seeds territory manager Barry Smallridge.

Forages are an important pasture supplement during summer, as they help deliver the protein intake often lack-ing in pasture at this time of the year, he says.

“Although summer pasture grasses continues to have high DM content they are often low in protein during Jan-uary and February. Forage supplements will therefore help reduce the fall-off in milk production at a time when other options to prevent this reduction are often difficult to come by.”

Properly managed forages also provide growers with a wider range of feed options than alternative crops such as brassicas or turnips. Forages deliver fast regrowth for addi-tional harvests, and in addition to direct grazing, they can also be conserved as hay or silage, says Smallridge.

To help growers with the growth and management of summer forage crops, Pacific Seeds has published a guide: ‘Your Guide to Summer Forage’ covers from pad-dock selection and preparation, through to crop manage-ment and feed conservation, and a hands on method to estimate soil temperature.

The Pacific Seeds range of summer forages includes Sprint and two BMRs, both of which are proven perform-ers.

Sprint is a Sudan x Sudan available for first grazing or cutting within about 50 days, and second-cut/graze about 25 days after that. It is suitable for all stock types, as well as hay and baleage.

Pacific Seed’s BMR hybrid options include Rocket– an early flowering type, and Octane – later flowering. Feed analysis of these BMRs show a 3 – 6% digestibility advan-tage over non BMR hybrids.

This in turn translates into an extra 0.3 to 0.7MJ/kg of metabolisable energy. Note that both these hybrids, con-tain the correct BMR genes which characterise a true BMR hybrid.

“It is these genes, including BMR 6, which deliver the quality yields, digestibility, standability and fast regrowth that growers rely on from true BMR hybrids,” says Small-ridge.www.pacificseeds.co.nz

Guide to summer forage points way to protein

Report is now available to farmers and their advisors using Insight.

This report shows farmers the changing udder health status of their herd, giving clues on how to improve masti-tis control and reduce the number of clinical masti-tis cases.

Data to produce the

report is automatically pulled from the herd’s test data on Insight as well as any health or drug treat-ment data entered by the farmer, says Huurnink.

An introductory ses-sion on the Mastitis Focus Report was jointly hosted by DairyNZ and CRV this month at CRV Ambreed’s centre near Cambridge.

The session involved interaction between invited farmers and vet-erinarians, alongside DairyNZ and CRV staff.

Huurnink says the most important message received by the farmers was to prevent mastitis before symptoms appear, and that healthy cows pro-duce quality milk.

Forages supplement pasture during summer.

The Mastitis Focus Report is now available to farmers.


32 // anImal HealtH / nutrItIon

Cow nutrition imbalance eroding milk yield, farm income

daIry club to sHare resources

ALONGSIDE THE Tracker, Hague is building a resource centre as a ‘dairy club’ for farmers interested in better nutrition. Farmers will be able to use tools, find information and ask questions within the forum to help them get their herds’ nutrition right. Hague and NZARN colleagues will also be running nutrition workshops around the country.

andrew swallow

tHousands oF kilo-grammes of milksolids and income is being lost on New Zealand farms because cow nutrition isn’t up to scratch, says a Canterbury-based dairy business analyst and nutri-tionist.

“For many produc-ers there is a shortfall between the potential milk production and what is actually achieved,” says James Hague, of Daisy’s Agriculture. “Most of this lost milk is due to nutri-tional reasons.”

Hague has designed

an online dairy business management tool which highlights the problem. It predicts weekly milk production based on the genetic make-up of the herd. The tool, called Tracker, then tracks actual production, as recorded by the farm’s milk company.

For an average sized farm with 350 cows the difference can amount to 20,000KgMS, or $110,000 at current payout fore-casts, he says.

One of the trends Tracker has identified is excessively rapid declines in output post peak, indi-cating cows are running out of fat reserves.

“If the diet does not encourage high dry matter intakes to supply the nutrition the cow needs, then once those fat reserves are expended milk production drops sharply. Some herds are dropping at over 4% per week as opposed to the target of 2-2.5% per week.” Company milk graphs show this to be a national trend, indicating most herds are affected, he notes.

Weather and grass quality are important fac-tors. For example, on a dull day, sugars in the grass are much lower than on a sunny day, to

the extent the lost fer-mentable energy can be the equivalent 1.5kgDM of high ME meal or molasses

for a cow eating 14kgDM of grass.

“The aim of our job as dairy farmers is to allow

the cow to express her potential so if you look at the forecast and it says the weather will turn to cus-tard, you need to put more energy in or we will lose milk.”

One of the skills he’s observed among the best producers “is knowing when to turn the feed up, and when to turn the feed down. Keeping a balanced

diet in front of the cows certainly helps to reduce the variability in produc-tion.”

The Tracker uses weekly calving data and the farm’s target produc-tion for the season to plot a season-long production curve with weekly targets. When output drops below target, users can look at nutrition of the herd and

“For many producers, there is a shortfall between the potential milk production and what is achieved.”

Is your production dropping too fast, asks nutritionist James Hague.

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anImal HealtH / nutrItIon // 33

Cow nutrition imbalance eroding milk yield, farm income

about Hague

JAMES HAGUE hails from the UK where he had a dairy farm and worked for independent dairy costings business Kingshay. He came to New Zealand four years ago and has been consulting for the past three years under the name Daisy’s Agriculture.

He’s marketing the basic Tracker either as a standalone package for $250, including set-up, or, preferably, as part of a Dairy Club subscription costing $450. The subscription includes a dairy farm management informa-tion service and fellow-farmers’ network. www.dairyclub.co.nz

take steps to address the loss.

“Many farms on the Tracker are showing big drops throughout the season, followed by modest recoveries. Taking action sooner can help avoid these drops.”

Hague says at an indus-try level Tracker shows the large potential that many herds have to increase pro-duction— potential not being realised. Herds with the smoothest production curves achieve a total of about 250 times their peak daily milksolids.

“That 250 times peak daily production ratio is a good starting point for many farms to look at, and assess whether their sea-son-long production is reaching the potential,” he suggests. “For example, one farm was achieving a peak of 930kgMS/day. That indicates it should have been doing 230,000kgMS in a season, but because of a sharp fall from peak and inconsistent pro-duction through the season the herd only did 197,000kgMS. That short-fall of 33,000kgMS was worth about $200,000.”

Many farms do not have sufficient “insurance policy” feed stocks, or at least arrangements to get feed in quickly if grass is short, hence the incon-sistent production, he adds. “Producers should weigh up the cost of this lost milk with the cost of having silage and feed stocks to buffer the short-falls.”

Protein and fat curves lie behind the consoli-dated milksolids curve in the Tracker. If protein pro-duction is ahead of sched-ule, that’s a good sign. If it’s behind, that’s an indi-cation the cow or herd may be burning protein as energy, which is both inef-ficient as protein is a high cost feed, and environ-mentally bad because the nitrogen from the protein is excreted.

“The milk data we get every day tells us a huge amount about the nutri-tion of the herd.”

If processing compa-nies passed on milk urea content results it would reveal even more, but at present most, including Fonterra, don’t, he notes. “We need those figures out there. They can be an indication of excess pro-tein in the diet, or even too little.” An all grass diet is typically well over 20% protein, but a lactating cow only needs about 18%, so the excess is excreted in milk and urine. “It’s all about balance – balance, balance, balance all the way.”

Hague is a commit-tee member of the New Zealand Association of Ruminant Nutrition-ists (NZARN) and says all dairy farmers should learn as much as possible about nutrition.

“That knowledge can help interpret what is hap-pening on farm. Much can be done to keep produc-tion on track, but reading the signs and interpret-

ing them is not always easy without having tools and knowledge.”

In the near future Tracker will be updated to include records for culls, feed inputs, feed costs and production predictions from different classes of feeds, with associated margins over feed and forage forecasts.

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34 // anImal HealtH / Feed

Good quality feed when times are badaustralIan daIry farmers are being urged to bear the costs of main-taining good quality feed for their cows, even when times are tight.

Colac DPI dairy extension officer Nadine Markham told ‘Tactics for Tight Times’ field days in south-west Victo-ria that reducing feed inputs was a risky strategy.

Markham says cutting back feed or not using enough supplements could lead to increased over-grazing and reduced pasture growth which would stop farmers from maximising profit.

“If you pull back on feed you get hungry cows and profit drops. Some-times you have to accept profit is lower but you still have to feed your cows properly. Even in a year of low milk prices and high feed costs you still want your cows to be fully fed.”

Markham says cows should be fed well enough to dilute fixed costs. “Higher production per cow dilutes the fixed cost of maintain-ing the cow. If the diet is properly balanced we get more milk out of cows as we put more feed into them, which dilutes the total cost of producing the milk. Every kilogram you feed above mainte-nance comes back to you in milk.”

Markham says a 550kg Friesian during lactation needed 9kgDM or 100 MJME and would return 60 MJME.

Farmers should aim to use less than 40% imported feed, she says. “In a good year, the more you can grow the less expensive feed you have to bring

in, which means more profit. You should grow and consume or con-serve as much high quality pasture as is

profitable and use supplements prof-itably to fill feed gaps and balance the diet.

“Fine tuning your system to make the most of your pasture base and feed system will increase farm profits. If you use more than 40% imported feed you

expose yourself to risk, especially in a bad season. Home-grown quality pas-ture is the cheapest source of feed if it is used well.”

Markham urged farmers to take a long view of stocking rates based on milk price and feed cost outlook and to monitor their farm performance annu-ally.

The field days were hosted by West-Vic Dairy and facilitated by the Depart-ment of Primary Industries. Dairy

Australia developed the campaign as a levy-funded initiative to support dairy farmers through the milk price down-turn.

About 130 dairy farmers and ser-vice providers attended the field days at Cooriemungle, Colac and Bookaar where topics such as market trends and outlooks for feed supplements, nutri-tional impacts of feeds and the con-sequences of feeding decisions were discussed.

Price comes second in feed equationFarmers sHould focus on quantity and quality more than price when buying feed, a field day in Western Victoria has been told.

Ron Storey from Australian Crop Forecasters told the ‘Tactics for Tight Times’ field day that price should be the least important consideration when farmers are buying feed.

“You can control quantity and quality, delivery period and delivery point and payment teams; price is the least controllable. You need to know what you want.

“Quality is the biggest component and price is the least likely to impact on milk volume. There is more money in buying energy and there is more money in quality, quan-tity and delivery than in haggling over A$5 or $10 on the price. Go for the low hanging fruit.”

Storey encouraged farmers to get feed contracts in writing and to actively negotiate the best deal for their needs and to particularly focus on quality.

“All terms are negotiable. Sellers will take control if you allow them to so you need to build a good relationship. The grain market is competitive so use that to your advantage.”

Storey says farmers should plan, not predict, what might happen in markets and when buying feed. “We’re all punters but no one can accurately predict what will happen. But we should plan; too many farmers walk out the door in the morning and say they need another load of feed which means they then have to pay spot prices.”

Storey predicted grain prices would remain firm until mid-2013. “It remains uncertain until 2013 crops are assured, but it is hard to argue a case for major price drops before the second quarter of 2013.”

Fodder supplies might be lower than normal from northern Victoria and New South Wales due to strong export markets and floods last March, but there is good supply in southern Victoria.

“Quality is excellent throughout Victoria for all hay types,” Storey adds.

He says sellers were remaining firm on prices which may rise A$20-$50/t if there is a normal summer and March-April autumn break.

Nadine Markham

Reducing feed inputs can be a risky strategy, says Australian dairy expert Nadine Markham.

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In Victoria, Australia Christmas break is also the time for putting bulls in with the herd to mop up those cows not pregnant by AI.

Keep an eye on the kids (and bulls) this holidaywell 2012 has flown by and here we are at the end of yet another year.

Dairy farmers have faced some real challenges over the last year, with many curved balls thrown out by Mother Nature.

Depending on what part of the coun-try you live in, we have faced fires, floods or droughts. Combine that with global economic uncertainty and 2012 has been a tough year for many.

The dairy indus-try still has many bright points to look forward to in 2013 and beyond. I think as global uncer-tainty resolves and the demand from developing economies for milk prod-ucts increases, that we in Australia are well placed to continue to supply the world with quality, safe products.

Christmas is a time for family and reflecting on the year past, but it is also a time for looking forward and it can also be a very busy time of the year.

Unfortunately, summer holidays do not mean that work stops on a dairy farm. The kids are home from school, and with that comes the risk they may get injured in a farming accident.

Quad bikes are one of the most danger-ous things on a farm, but there are many potential dangers lurking on the average dairy farm so make sure that children are supervised, trained and take all safety pre-cautions if helping out around the farm over the Christmas holidays.

Watch out for risks as diverse as sun-burn/sunstroke, snake bites, drowning and injuries caused by livestock or machinery.

Nothing would ruin your Christmas cele-brations more than a serious injury to one of yours, or an employee’s children when “helping out” mum or dad on the farm.

Over my years as a vet, I have seen many instances of kids hurt during the holidays so I ask you all to take extra care.

In my part of the world, Christmas break is also the time for putting the bulls in with the herd to “mop up” those cows

not pregnant by AI.I have written before about

the lottery this represents. Many dairy bulls would fail to pass a thorough Veterinary Bull Breeding Soundness Examina-tion (VBBSE). Issues that can cause sub fertility or infertility include abnormalities to their reproductive “tackle”, lame-ness, conformational or other health conditions.

Introduced bulls may also represent a risk of introducing diseases to your herd that could create reproductive or other disasters. Problems like Pestivirus, Johnes Disease and STDs like Vibriosis or Trichomoniasis often come into the farm when bulls are bought in from another herd.

Talk to your dairy vet about a health and biosecurity plan that will protect you and the herd from introduced diseases and infertility in the bulls you are buying.

I wish all the readers of Dairy News the safest, most prosperous and happiest New Year ever and the complements of the upcoming festive season• Rob Bonanno is the past president of the Australian Cattle Veterinarians Association and a director of the Shepparton Veterinary Clinic.

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36 // anImal HealtH

Trevor Smith

Dairy feed toxin content ‘probably underestimated’

new Zealand’s evolving farming systems and climate change are making our dairy cows more susceptible to health problems associated with

fungi and mould, says a visiting Canadian expert in the field. But they are hard to pinpoint to fungi or mould toxins, says Pro-fessor Trevor Smith from Ontario Agricultural Col-lege at the University of Guelph. Better method-ologies to detect chemi-

cals associated with fungi could lead to improved production and animal health.

Smith was brought to New Zealand last week by Alltech (NZ) Ltd to look at changes in New Zealand farming systems and bring industry up to date with

pam tIpapamelat@ruralnews�co�nz

the latest research in his field. Smith has worked in the field of mycotoxins for 35 years at the University of Guelph.

Smith explained to Dairy News that mycotox-ins are small chemicals produced by moulds and fungi. Fungi or moulds themselves are relatively easy to destroy using heat treatments or chemicals. “But these compounds produced by the moulds are very stable. They are hard to destroy once they are present so that’s a real challenge,” he says.

The dairy industry’s primary concern is afla-toxin, the mycotoxin which causes liver cancer – it is one of the most car-cinogenic compounds known to medicine. Afla-toxin is watched over by Government and milk pro-cessors test for it.

Substances such as peanut and cottonseed meal are particularly sus-ceptible to fungi. “But the main source for cattle in New Zealand would be from palm kernel,” say Smith. But there are other toxins in other areas such as silage, pasture (rye grass staggers and facial eczema) and various prod-uct blends. “This is quite a challenge to the dairy cow,” he says.

When Smith first started studying the toxins in the 1970s, it was common to have myco-toxin issues maybe every third year. “But over the last decade or decade and a half, there’s been issues every year and it’s generally related to cli-mate change and extreme weather,” he says.

Rain and cold weather is known to pro-mote mould – but so can drought. Drought stresses the moulds and they respond by produc-ing more toxins,” he says. Cracking of plant surfaces allow fungi to invade.

Smith has visited New Zealand for 11 years and says evolution from a pure pasture-based production system to more feeding of blends of byproducts exposes the dairy cow to a bigger risk of mycotoxins.

“It has always been a challenge knowing when the feed is contaminated,” says Smith. “The most recent information indi-

cates probably the anal-ysis in commercial or industrial labs is under-estimating the true toxin content.”

Recent research shows there are different chem-ical forms of the toxin. “There is the one we mea-sure that is produced by the fungus but that com-pound can be changed by the plant the mould invades. It is thought to be a defence mechanism… chemically it is quite dif-ferent from the toxin that is produced by the mould. But it is still toxic because when the cow consumes the feed, using enzymes in the rumen it can con-vert that back to the origi-nal form.”

Laboratories have not been able to measure the different compounds. “We’ve been working on that and we’ve produced a simple method that can be used in company lab-oratories or commercial labs that will allow you to quantify the toxin and the total toxin – which means the sum of all the changed toxins. That will give a better opportunity for producers, milk com-panies, processing compa-nies to make better quality assurance decisions and to reject certain materials as being unsuitable.”

Aflatoxin in milk is a human food safety issue but a variety of myco-toxin compounds affect the cattle themselves. Quite a few are found in silage. “They are produced by pencillin mould and maybe aspergillus mould. Many of them are anti-biotic – when the dairy cow consumes this it may seriously disrupt rumen fermentation. Nutrient utilisation goes way down and milk production falls off.

“Others toxins found in grains and other byprod-ucts affect cows with loss of immunity. With immu-nosuppression, we see lin-gering health problems, cows that don’t respond to medication and failure of vaccination, probably the greatest single loss of income to the producer.”

A consultant for Alltech, Smith travels to Australia, Chile, France, Spain, Turkey, Russia and China to discuss myco-toxins.

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EID usage lifts farm performancea weIgH and scan station has stream-lined management for Northland dairy grazier and beef farmer Graham Hodg-son, grazing 350 on 230ha at Whatatiri, south west of Whangarei.

Three farmers have replacements rearing on the farm. One has sent replacements there for 10 years. Hodg-son attributes this to his careful mon-itoring of stock, including weighing animals once a month to make sure they remain in top condition.

“Stock might look alright but some-times they might be losing weight which would indicate there is a prob-lem with them. If you weigh animals three months or even six months later any problems are much harder to fix.”

Previously the farmer who owned the stock came onto the farm and recorded cows’ weights and tag num-bers by hand before taking them home and entering them into a system.

Hodgson now emails all information to them in CSV files since he installed a Gallagher W610 weigh scale Indicator and HR1 electronic tag reader. “I just need to upload it to my computer, email

it and it’s gone.”Besides allowing for automatic

weight-based drafting, the scales will assign visual tag numbers against EID tag numbers for easy instant identifi-cation and can store up to 12,000 ani-mals and 1200 records with the ability to also record body condition scores. “It certainly makes my job a lot easier.”

Having that information for indi-vidual animals immediately accessible allows more focused management, says Hodgson, and he has worked with farm-ers as a result to get cows into peak con-dition for mating.

“Farmers are able to upload the information to Minda and instantly see growth patterns. This allows my grazers to fast-track the development of their high BW herds.”

This lead him to the extraordinary measure of feeding palm kernel extract to one grazer’s herd at the start of this

season to make sure they hit target weights at mating. “It is a cost but the potential pay-off is huge. It’s not some-thing you’d do every year but we just haven’t had the rain to get the neces-sary grass growth.”

Hodgson also finishes steers and heifers on the farm and winters a total of 580 cattle on his property.

He has started using the scales to monitor the progress of 150 recently purchased 2-year-old bull calves. The

scale’s ability to calculate the average daily weight gain and carcase weight of stock has come in handy when doing this, says Hodgson, as it allows him to see the growth pattern of each animal.www.gallagher.co.nz

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“If you weigh animals three months or even six months later any problems are much harder to fix.”

Careful monitoring of stock ensure they remain in top condition, says Graham Hodgson.

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38 // macHInery & products

Quad flexible roll bar available on sale soona FleXIble and ‘pas-sive’ farm quad roll bar made by Ag-Tech Indus-tries, Dargaville, is now reckoned the best way to avert injury, should machine and rider ‘meet’ after a rollover. The roll bar – or ‘crush protection device’ (CPD) is branded Lifeguard; it is believed a world-first.

These once-contro-versial quad accessories gained a fillip from the August 2012 finding by the Mt Isa, Australia, Farm Safe Conference run by Health and Safety Austra-lia, New Zealand and USA. The conference concluded that quad manufacturers’ decisions to oppose roll

bars has been shown up as invalid.

Says Ag-Tech Indus-tries, “This is a major step forward as statistics have [pointed to] a marked increase in injuries and fatalities since the removal of CPDs. It has been estab-lished that a CPD, as they are now called, is essential to protect against crushing – the major cause of con-cern and the major cause of injuries and deaths.”

The company says a steel roll bar will give crush protection but can have limitations in causing injuries, because of being “very unforgiving when they strike or land on the rider on the ground”.

Ag-Tech Industries’ new concept has been developed and tested for 18 months, attracting a lot of interest from govern-ment departments and health and safety organisa-tions in New Zealand and Australia.

Unlike a hard, rigid roll bar, the Lifeguard is pas-sive and flexible and will deflect around a person’s body, limbs or head on impact, but will not col-lapse and will hold a quad off the ground to pro-vide crush protection for the rider. The key feature of the Lifeguard is its arc design – individual seg-ments held together in tension by cables enabling

it to flex and move on impact, and to support weight.

The product this year won the New Zealand National Fieldays ‘Golden Standard’ award for excel-lence in innovation.

On sale in January 2013. www.lifeguard.co.nz

an advantage Feeds tray hay feeder is helping a Waikato organic dairy farmer offer his stock supplement in ways that haven’t before been possible.

Nick and Jo Collins milk 255 Friesian cross cows on a 130ha (eff.) platform at Piopio, south-west of Te Kuiti.

With 255 cows and replacements being kept on the milking platform for much of the year, strategic use of supplements helps ensure condition stays on stock and the farm’s pasture stays long, Collins says. He feeds hay from October to keep condition on animals and production up when pas-ture growth slows.

Despite having a bale feeder and hay racks, Collins says they found it difficult to get supplementary feed to smaller mobs of dry cattle on the farm during this period. Weighing only 130kg empty, the tray hay feeder has solved this problem well, says Collins. Mostly it is used on some hill pad-docks lacking tractor access.

“Rather than having to feed out daily, you just need to drop a bale in the tray and they’re good for a few days. It’s a great time saver.”

Some soil compaction occurs around the feeders but nothing excessive if cattle numbers are not too high and conditions are relatively dry underfoot. “There is some degree of soil damage around the feeder after winter but the over-sowing of tap-rooting plants such as chicory and plantain soon corrects this.”

Collins has also used the feeder through spring to offer the milking cows supple-ment after milking. It’s a good way to get extra feed to animals without damaging the pasture, he says. “It’s a time saver and it gives cows access to food as they need it.”

A beneficial use of the feeder is load-ing it and leaving it; Collins says he plans to take full advantage of this next season with late calving cows. “I should have used it for late calvers in October; it would have been ideal for that small number and I will certainly use it for them next year.”

He uses an estimated 200 silage bales and up to 400 bales of hay to supplement fresh pasture. Most of the feed is grown on-farm; the rest is bought in from certified organic farms in Taranaki and Hawkes Bay.

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Gongs for Ford

Ford Kuga has been recognised for its safety innovation.

Ford Is the first car manufacturer to achieve six different Euro NCAP Advanced rewards for outstanding technologi-cal innovation. It recently received awards for MyKey on new Fiesta and SYNC with emergency assistance on its new B-Max, Fiesta, C-Max, Focus and Kuga.

Ford also achieved maximum five-star safety ratings for the Kuga and Fiesta from the indepen-dent vehicle safety organi-zation, following its latest round of crash tests.

“MyKey and Sync with emergency assistance are not just new technologies for Ford in Europe, they’re technologies never seen before in small cars,” says Andrew Johnson, super-visor, automotive safety office, Ford of Europe.

New Fiesta’s MyKey technology enables par-ents to restrict drivers by limiting the vehicle’s top speed and lowering the maximum volume of the audio system. It also provides earlier low fuel warnings, prevents safety features including elec-tronic stability control and active city stop from being deactivated, and mutes the audio system if the driver and front seat passenger fail to buckle up.

In the event of an acci-dent, Sync with emer-

gency assistance enables the B-Max to assist the occupants to call a local emergency services opera-tor in 26 languages spoken in 40 European regions. It uses information from the on-board GPS unit, map and mobile network to pinpoint the accident loca-tion and calls emergency services via an occupant’s Bluetooth connected mobile phone. The tech-nology is also available on the Fiesta, C-Max, Focus and the Kuga.

Ford has been awarded Euro NCAP advanced rewards for active city stop (a safety system designed to help drivers avoid low speed collisions) on the B-Max and Focus. The Ford Focus has gained advanced rewards with driver alert; forward alert; and lane keeping aid.

“Euro NCAP advanced rewards recognise safety innovation of the high-est level,” says Michiel van Ratingen, Euro NCAP sec-retary general.

In achieving a five-star Euro NCAP rating, the Kuga got 88% for overall protection (said to be the highest rating for a mid-sized SUV), as well as 94% for adult protection, and 86% for child protection. The Kuga also offers Sync with emergency assis-tance, active city stop

and blind spot informa-tion. This system indicates with a warning light in the door mirror that a poten-tial hazard is in the driver’s blind spot.

The Fiesta scored 83% for overall protection in achieving its five-star Euro NCAP rating; 91% for adult protection; and 86%

for child protection. As well as debuting MyKey, it offers segment-first active city stop, Sync with emergency assistance, and a body of which more than 50% is fabricated from high strength and ultra-high strength steels for additional accident protection.

Kia’s online popularitytHe KIa Rio has been voted a dual winner (drivers and critics) in the People Choice Awards on an Australian web-site.

The Rio then went on to join the Kia Sportage in claim-ing top wins in the Australian Automobile Association’s Best Cars awards. And the Rio is a finalist in the Canadian Automotive Jury 2013 ‘Best of the Best’ awards.

The car topped the votes on the motoring.com.au web-site as the most desired first car and won the inaugural overall prize as the most popular of the 13 segment win-ners.

The 13 lifestyle categories by which the various cars were selected mirror the search options shoppers can use to find vehicles they want on the various car sales network sites in Australia. For 2012, the People’s Choice Awards are based on the motoring.com.au editorial team settling on the finalists, with winners in each category then decided by popular vote from the public. To be considered, each of the cars had to be on sale and driven by motoring.com.au prior to September 1 this year.

“The car sales network of websites attracts more Aus-tralians buying and researching new car purchases than any other; they are well informed and that adds more kudos to a category or outright win,” says managing direc-tor and chief executive of carsales.com Ltd, Greg Roebuck.

The Rio is also one of the most popular models in the Kia range in New Zealand.

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40 // tractors & macHInery

Independent contracts within family business works well for Forkerts

an agrIcultural contracting business that works ‘separately but together’ is Forkert Agri-cultural, Paterangi, 13km from Te Awamutu.

Maurice and wife Leonie Forkert have been contracting in the area for 10 years with son Paul working for them during this time.

It is a full contracting business doing silage and hay, mowing, raking and baling with big squares and rounds. Added to this they have a Krone Titan loader wagon for bulk silage to pits, bunkers and stacks. The square baler is a M-F 185.

Maurice does all the square baling and Paul does all the round baling using a Vicon Bale Pack Combi Unit. They offer full cultivation and ground preparation for all crops including power harrow-ing and a roller drill. They harvest all crops.

They work to Ngaru-awahia in the north and to Otorohanga in the south, up to 50km from their base. They employ two full time staff and one casual when needed. Tractors are all M-F and they have

tony HopKInsonfive ranging from 90hp to 220hp.

Four years ago Paul and wife Renee set themselves up as independent contractors within the family contracting business. “We wanted to have some independence for ourselves but still be

part of the business I have always been a part of,” said Paul.

They were also keen to expand into other areas of contracting his par-ents were not so keen on: crop and pasture spray-ing, round baling and har-vesting grass with a loader wagon.

Paul has just taken delivery of his latest M-F 7619 rated at 190hp from Piako Tractors, Morrins-ville. “I have dealt with them before and dealer principal Darrell Russell

is great to deal with and the back-up service when needed is just what a busy contractor needs.”

The tractor is the latest Dyna 6 transmission with six power shifts on the move and Dyna power management giving extra power delivery in demand-ing applications. The trac-tor has the latest AGCO Sisu Power engine with accurate AdBlue injection to ensure the motor meets the new low emissions standards.

The larger diesel and AdBlue tanks mean longer times between refuelling stops.

“We have always been M-F people and this tractor has the tried and proven transmission as well as being the latest from a well proven brand.”

Paul admits that he himself is not a ‘small unit’ so he appreciates the extra roomy cab in this tractor.www.piakogroup.co.nz; 027 215 0403 - Forkert Agriculture.

“We wanted to have some independence for ourselves but still be part of the business.”

Paul Forkert appreciates the extra roomy cab.

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tractors & macHInery // 41

Crucial tool in contracting plana new Massey Fergu-son 7624 Dyna-VT trac-tor is a prime mover in a large dairying operation with a contracting strategy that contributes to get-ting silage made when and where it’s needed.

They’ve only had the fully-specced MF7624 for a short time, but say it complements their exist-ing tractor fleet, par-ticularly their Massey Ferguson 7400.

Cooksons, dairy farm-ing in Waikato since 1926, now run a large operation including four dairy prop-erties in Waitoa. They milk

2400 cows, with contract milkers employed on each farm, 11 fulltime and three part-time workers.

“This property started off as eight small farms which we’ve reshaped into one large farm,” Richard Cookson says. “We have our own cultivation and rolling gear and also do a bit of work where the cows have pugged paddocks.”

Richard runs finance, governance and human resources; his brother Robert is the operations manager.

Now the company is taking on more contract work, focused on grass -- particularly mowing and bulk silage. “The strat-egy of the contracting is to add value to our business so we can do grass silage and get it into a stack as quickly as we can to main-tain quality,” Richard says.

“In most cases the con-tracting is based on grass. We want to be a grass-fed system and maintain qual-ity. We work for a small group of clients whom we look after. We’re there within three or four days when they want to do silage.”

During early season the Cooksons use the Massey Ferguson 7624 Dyna-VT with a loader wagon for grass silage, as well as for ground work. Later on, it will be take on any jobs that need doing, including

stack work, and in autumn it will go back to cultiva-tion.

Robert Cookson says it is the latest in a long run of Massey Fergusons owned by his family. They currently have a 7499, two 5430s and a 390.

“We looked at a 7600 tractor and ordered the 7624 from there. We liked the layout of the cab and we’ve had a really good run out of the 7499, which has done 1000 hours in the 12 months we’ve had it,” he says.

“The 7624 just looked really comfortable and

everything is user friendly. The cab gives great visibil-ity and it’s a much quieter tractor to drive. You can’t hear the engine noise.”

The Cooksons opted for the limited edition model with full specifica-tions, including the joy-stick controller. Robert says the joystick makes stacking maize much easier due to the forward-and-reverse controls on the stick.

The 7624 has Dyna-VT (stepless) transmis-sion, simple to operate -- no shifting of gears, no jolts and no breaks in traction or power. The joystick makes forward-reverse shuttling and speed change convenient and easy.

Robert says the 7624 is ideal for loader wagon work because the position of the drawbars keeps the weight in close to the trac-tor. “All the specs make the tractor more user-friendly and keep our run-ning costs down. That’s why we specced it to what we did.”

The 7624 is mainly driven by Richard and Robert’s cousin, Stuart Colson, a self-employed operator. He also likes the joystick and the location of the PTO and throttle. “The joystick makes it a lot more comfortable to drive and it has good lights on it,” he says.

Richard says the 7624 is a key piece of machinery in their fleet.

“Our business is based on being nimble and adapting to the condi-

tions each year. Because we’re a rain-fed system, we need to be able to be flex-ible. We want to provide all clients a good service,” he says.

“The cab gives great visibility and it’s a much quieter tractor to drive.”

The MF 7624 Dyna-VT with a loader wagon for grain silage.

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is a worldwide brand of AGCO.www.masseyferguson.co.nz | Freecall: 0800 826 872 is a worldwide brand of the AGCO Corporation.


42 // tractors & macHInery

Eight ‘cats’ achieves NZ recordownIng eIgHt Case IH Puma tractors is reck-oned to be a New Zea-land record – held by Bay of Plenty contractors Phil and Cheryl Brogden.

Their firm, PJ Brogden Contracting, has worked 38 years in the business, at Awakeri, 15km from Whakatane.

They run a full con-tracting service with silage and hay mowing, raking and harvesting program. This includes square and round bales, a loader wagon for pit or stacked silage, and a full culti-vation and planting and harvesting service for all crops, including maize. The business works up to 50km from base.

They also run a truck-ing service mainly for their own bales and bulk grass and maize silage as well as general cartage. “Any contracting work a farmer wants done we can do it,” says Phil.

Cheryl manages the

base, organising the staff and work programme and looking after the accounts.

Brogden Contracting has nine full time staff, some with 25 years service. “They all can multi-task so if there are jobs to be done they can all help as well as the tractor driving.”

Why all Case IH Pumas?

“There are good rea-sons to standardise on one model,” says Brogden. “Firstly they are top trac-tors; any driver can drive any tractor as they do not have to change their thinking at all and all the gear hitches, PTO shafts and the like are all stan-dardised so there is no risk of error.”

Brogden Contracting had four Pumas 165hp to 210hp and has just taken delivery of their four latest model Case IH Puma with full power shift rated at 215hp. They were supplied by Whyteline Limited, Paeroa.

“This is the ‘gold spec-ification’ model, which means it has all the bells

and whistles,” said manag-ing director of Whyteline Ltd, John Whyte.

Whyte says there are ‘bronze’ and ‘silver’ models for famers or con-tractors who do not need all the extras.

Brogden, when he ordered the machines, was able to fill in a speci-fications list he wanted to suit his work, and ordered them when they were being assembled at the factory in Austria.

These included ‘Euro hitch’, front suspen-sion, five hydraulic ports, oversized tyres and multi-control command module.

“I chose the over-sized or ‘super single’ tyre as there was then no need to run duals and they improved our access through gate-ways, and cause less compaction on culti-vated ground but still retain their stability on rolling to steeper coun-try.”

One of the latest deliv-eries also has front linkage

and PTO.The multi-control com-

mand module is at the driver’s right hand and has all functions easily read day and night with back lighting.

The motors are all Tier 4 which meet the European strict emis-sion standards with selec-tive catalyst reduction (SCR) technology. “These motors produce almost no emissions at all,” said Whyte.

This is an after treat-

ment that places a mixture of urea (Ad plus) and pure water into the exhaust system that converts the NOx into nitrogen (N3)

tony HopKInson

BROGDEN CONTRACTING has the Euro Star hitch system fitted to its Case IH Puma model tractors and has standardised all implements to utilise it.

It is located almost under the differential drive and is extended, lowered, lifted and returned hydraulically. The hook hitch locks into a clevis and no safety chains are needed.

The weight of the implement is brought as close as possible to the rear end of the tractor, increasing stability and traction.

The driver does not have to leave the cab as all controls are at hand.

“There is a sequence to hitch/unhitch the implements so there is no chance of the implement com-ing off,” said Brogden.

worKIng From tHe cab

and water as found natu-rally in the air. The process enhances engine perfor-mance and reduces pol-lution.

“While the higher

owered tractors might be large for hay rakes, etc, they can return to the depot and immediately go out with a 6m power harrow,” added Brogden.

PJ Brogden Contract-ing and Whyteline have an association going back many years.Tel. 07 304 9471www.whyteline.co.nz

Phil Brogden (standing second from left) with his team.

Phil Brogden (left) and John Whyte, Whyteline Ltd.

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Dairy News 11 Dec 2012

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Transcript of Dairy News 11 Dec 2012