Dairy Focus, August 20 2013 by Ashburton Guardian

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Guardian Ashburton

Dairy Focus August 2013

The Wright stuff Page 2

Pages 2&3

2 Dairy Focus August 2013

Dairy Focus An advertising publication of the Ashburton Guardian Opinions expressed in this publication are not necessarily those of the Ashburton Guardian Publication date: June 18, 2013 Next issue: July 23, 2013 We welcome any correspondence to either: Linda Clarke, phone (03) 307-7971 email: linda.c@theguardian.co.nz Desme Daniels, phone (03) 307-7974 email: desme.d@theguardian.co.nz Designed by Simon Fox, Ally Lamb and Eden Kirk Williams

Kimberley’s on a mission Story by: Linda Clarke

Photography by: Joseph Johnson

hen Mid Canterbury herd manager Kimberley Wright walks into a paddock the cows stop and look. Some come up for a pat. The 23-year-old might not know all 560 cows under her control, but she knows at least 50 by number and 20 by name. Kimberley has a passion for dairy cows that is obvious as she checks her pregnant charges on the Coldstream dairy farm where she works for Warren and Suzanne Harris. Life on the farm is a long way from her townie upbring-

ing, but she is revelling in it and was last year one of the district’s top dairy apprentices. She has just begun her fourth season on the Harris’ Waimanu Farm; the property was a sheep farm converted six years ago and has the Pacific Ocean as its eastern boundary. The crossbred predominantly Friesian herd is milked in a 54-bail rotary shed. Warren said Kimberley was a natural, despite her lack of experience. “We just advertised in the Guardian. We got a lot of people who had been in the industry and Kimberley, who did not know one end of a cow from the other.

“She just had the right attitude, and a willingness to learn new stuff. She takes everything in and wants to go places.” Kimberley has progressed from dairy assistant to herd manager in just three seasons, combining on-farm learning with study through AgITO. She grew up in Ashburton, attending Allenton School, the local intermediate and Ashburton College, and got a taste for dairying on an uncle’s farm on the West Coast, where 80 cows were milked. “I used to go there on the

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Kimberley Wright and her trusty ute, custom-painted with pink horns. school holidays and I thought it was awesome. I decided I wanted to do farming.” After leaving Ashburton College, where teachers suggested a career working with children, she applied for a few farming jobs, but was knocked back because of her inexperience. Warren and Suzanne provided just the opening she needed. “They gave me a chance and I have been here ever since.” Kimberley admits the transition from townie to dairy worker took time. “When I first got there I was scared

of everything and I didn’t know what I was doing. I was scared of the cows and of being in the yard with them.” Three years on, there’s no trace of the young woman who once turned green at the sight of afterbirth during calving. She started by learning how to milk and survive in the cowshed, and has progressed to doing all the other jobs needed on a dairy farm, from moving irrigation to pasture and health animal health. Now as herd manager, she is one of three women

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who work on the farm alongside Suzanne and Warren. Women have a gentler touch working with the cows and tend to be more considerate with the young animals during calving, she said. It is crazy busy on the farm at the moment with the herd in the middle of calving. Kimberley gets up early and checks the calving herd for pregnant cows needing assistance. Then the main herd is milked in the shed, followed by the colostrums cows. The cows are then fed and calves collected.

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It is the busiest time of the year on any dairy farm, and sets the tone for the coming season. Kimberley said her plans for the future were to go sharemilking – a plan aided and abetted by Warren and Suzanne, who have given her a calf for every season she has worked for them. “I now have four and two in the milking herd and I get a percentage of the milk they make. I am already starting to get cows in their herd.” “Down the track they want me to buy more cows and go sharemilking. Them giving me a calf every year has really given me a boost.” Kimberley says Mid Canterbury is the place to be a dairy farmer and in the wider Hinds area there were plenty of like-minded dairy farmers and young farmers to so-

cialise with and be motivated by. Her parents Gary and Debbie have supported her along the way, with Gary coming out to the farm at peak times to help. Partner Ryan Robertson, who works in a near-by contracting business, is also there to help. Kimberley says she loves working with cows, feeding them and milking them. Within the herd, she has her personal favourites and pets. “We have 20 named ones and ones that will eat out of your hand.” There’s no bad side to the job for her, though she says the end of the milking season is always welcome as everybody working on the farm gets tired. Kimberley’s learning has not only been hands-on. She has been working on Level 4 of a National Certificate in Agriculture (dairy farming) run by AgITO and has plans to do a two-year diploma course.

Studying while she works has needed discipline. “You have to finish work and then do homework. It is hard, but Warren and Suzanne have helped. If I have an assessment due, they will give me a couple of hours off during the day to do what I need to do. They are the best.” The studying has paid off and last year Kimberly took home the outstanding modern apprentice award from the Mid Canterbury AgITO end-of-year prizegiving. She also won an eight-day Berwick outdoor experience – she attended the course in May between milking seasons and says it was great personal development. National AgITO boss Kevin Bryant said agricultural trainees like Kimberley advanced 30 per cent faster in their industry than those not on a study path. At that rate, she will be soaring soon.

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6 Dairy Focus August 2013

How about that weather A s another calving season rolls on, we farewell a tough winter. Not so much a cold winter, but a wet winter that has been difficult to manage from a winter feed and cow management point of view. A positive note is that although supplementary feed stores are low, farm average pasture covers look healthy and spring is shaping up reasonably well. A wet June made target feeding of lighter body condition cows, hard work. A cold, dry, and frosty winter is far more manageable from a feed utilization point of view than what we experienced. Most farmers

Hamish Davidson Mid Canterbury Federated Farmers’ dairy section head

North Island counterparts are recovering ent limits), we just don’t know what our I talk to are not overly happy with cow from droughts; we are recovering from final destination is or what we are being condition. This will have flow on effects a tough winter, but with projected milk charged for the fare. Not to mention if the leading into the current season. Cows will prices and world demand for our products train is on a collision course.” still milk well, but mating will need to be looking positive, some of the pain will be The sharemilkers section held a duccesstargeted to achieve industry guidelines. masked. ful debate and a few drinks to welcome People always comment how we as farmThe regional council and our industry new people to the district. The SchMOOze ers always talk about the weather. Must leaders are still working through nutriwas an awesome night with 60 od people be something to do with the fact we run a ent issues and the zone discussions have attending. A special thanks to CRT for their complicated biological system that relies almost 100 per cent on soil moisture, tem- begun. I encourage you all to become fully support. perature and the weather. engaged in this process that will dictate Roll on the silly season; keep yourself, fam20X2 COL Industry has been reasonably quiet for our “right to farm”. A quote I heard(74X200MM) the ily and staff healthy and safe. the past couple of months. DIRA, TAF and other day was something along the lines other such issues have been parked. Out of: “We are on the bus/train (being nutri(74X200MM)

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preparations, transport, installation, and plumbing connections. Genius Homes goes over every detail of a new home build with its customers carefully before construction starts. New homes and buildings are constructed at the Genius Homes premises at Washdyke, Timaru, by a team of skilled licenced tradesmen under the strict supervision of Genius Homes production manager. On site Genius Homes organises the site works for new and existing building sites, and once the home is delivered it takes from five to ten days to install and connect services, before it is ready to move in. Jeremy Richards the Geniu Homes Consultant says “Typically we only need about a week on site before the house is ready for occupation compared with three to four months on site with a conventionally built house. Also by keeping the production process in our factory, we have total control over quality and tradesmen on hand so can offer very fast build times.”

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Terry and Jacqui Carr, driving their way to success O

tago dairy farmers Terry and Jacqui Carr are always looking for ways to increase their farming knowledge. Equity managers for the Argyll Dairy Farm Partnership, the Carrs regard farming competitions as a good way to benchmark themselves against other dairy farmers while also gaining valuable farm management information. The Ballance Farm Environment Awards helped them do just that. “We entered because we wanted to improve our knowledge of environmental issues and to pick up information that would help us grow our business in a sustainable way,” says Jacqui. Sustainability has always been a key focus for the Clydevale operation, which milks 1200 cows on 332ha (effective) northwest of Balclutha. “It’s not just about ticking the boxes, it’s about making sure that we look after our staff, our land and our industry.” With dairy farming subject to increasingly strict regulations and scrutiny, the Carrs have taken a proactive approach to addressing environmental issues. This includes fencing off a buffer zone to keep stock away from the Clutha River, which borders the farm. Riparian planting to enhance this zone has been included in the annual budget. Fertiliser is applied carefully to avoid nutrient loss and the farm’s effluent systems have been designed to “go above and beyond” council requirements. The Carrs won the LIC Dairy Farm Award and the Meridian Energy Excellence Award in the 2013 Ballance Farm Environment Awards (BFEA). Judges were impressed with their passion for technology and

energy efficiency and their dedication to staff management, health and safety, recording and maintenance. They also noted the “exceptional relationship” between the Carrs and their contract milkers, Chris and Sandra Campbell. The Meridian Energy Excellence Award recognises farmers who are “driving excellence in utilising on-farm opportunities to generate or maximise energy efficiently”. Argyll Farm has two farm dairies, but only one is used during the early and latter parts of the season to reduce labour and energy costs. Both dairies utilise heat exchange units to increase energy efficiency, and the newest dairy features a lightweight, composite rotary platform that requires less power to operate. All houses on the farm are well insulated and fitted with modern and efficient heating systems. Jacqui says their experience in the Ballance Farm Environment Awards provided reassurance that the business was addressing environmental issues in the

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Terry and Jacqui Carr correct manner. “Being involved in the awards confirmed that we were doing the right thing,” she says.“Getting our entry together was a good exercise for us and the actual judging process was done in a very relaxed manner. It wasn’t just the judges asking us questions, we were also able to ask them questions and so we picked up a lot of information from them.” Jacqui says the expert judges made a number of good recommendations. “One judge even suggested we put a ladder in our effluent ponds, just in case someone falls in.” Jacqui says the feedback received from the

judges was excellent. “We felt it was a very worthwhile experience and we would certainly encourage other farmers to enter the competition. It’s a great opportunity to increase your knowledge.” Entries for the 2014 Ballance Farm Environment Awards are now open. Entry forms are available at www.bfea.org.nz More information on the 2014 Ballance Farm Environment Awards, including regional closing dates, can be found on the New Zealand Farm Environment Trust website.

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Fonterra at risk from GM ryeF

adopting proven, consumerfriendy solutions to improving its environmental footprint," he said.

Recent contamination of milk formula has harmed the reputation of Fonterra and New Zealand as a source of clean, safe, food, and is an urgent wakeup call for Fonterra to protect the integrity of its whole supply chain, members say.

"The DairyNZ research found improved resilience to drought, lower greenhouse gas emissions, and improved production from the use of mixed forage in dairying. Why aren't Fonterra and the Ministry of Primary Production getting behind that?

onterra must act to safeguard exports by keeping genetically modified organisms out of its supply chain, says a group wanting New Zealand to be GE free. It also wants dairy farmers to adopt mixed forage shown in tests by DairyNZ to reduce emissions and improve production.

There are enormous risks to Fonterra's future if it ignores the mixed forage solutions and gambles on genetically engineering a “magic bullet” solution in the form of GM ryegrass being developed by AgResearch and Pastoral Genomics. John Carapiet, spokesman for GE-Free NZ, said the New Zealand brand was built on the appeal to consumers of our natural, grass fed-milk, and sustainable and ethical food production generally, which must be protected into the future. "There is no need for Fonterra to import GE-crops as animal feed, or to delay

"The future of Fonterra's safety reputation is directly under threat from use of GE animal feed that has never been subjected to proper safety-testing or monitoring, and from an agenda to ignore natural solutions and push experimental GE ryegrass." He said it was not too late for Fonterra to learn from past mistakes and commit to keeping its food chain as natural and safe as possible.

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12 Dairy Focus August 2013

Setting your calves up for success C

alf rearing is a critically important job on the dairy farm. These new arrivals are the heifer replacements, and carry vital genetic gain for your herd. They are worth considerable time and effort. The following points are recommendations based on findings and experience within this practice. Calves should be picked up twice daily from the calving areas. This has the effect of reducing the potential time available for cross infection from mother to calf to occur. This is particularly true of Johnes disease. An additional benefit is to reduce the likelihood that the cow or heifer gets calving mastitis as long as she is brought in, teat sprayed and milked within 12 hours of calving. All calves should have their navels dipped in 10 per cent

alcohol based iodine (NOT teat spray). Dipping is preferable to spraying as coverage of both sides of the navel, and the inside of the navel (the most important bit) can be covered in iodine. Complete disinfection of the navel will prevent navel- ill which can lead to sick calves and eventually to bacterial arthritis in all joints. This (chronic joint infection) is an almost impossible condition to treat so is best avoided. All calves should receive at least two litres of colostrum within six hours of birth and another two litres within 12 hours. This is another good reason to pick calves up twice daily. After 12 hours the gut cannot absorb colostrum so calves that have had insufficient will not have protective antibodies circulating in their blood. These calves will be much more susceptible to disease. Once in the shed calves should be free from

cold wet conditions and especially draughts. They should be dried if they are wet. There should be about one calf per square metre and no more than 20 calves in one pen. Calves should be fed at the same time twice daily (preferable to once daily) and ideally with milk of the same temperature (blood warm) every day. The amount to feed is approximately 10 per cent of body weight per day. In most cases 2-3 litres is sufficient at one feed. Hay, straw and meal should be available from one week of age. This assists rumen development which in turn will ensure calves are able to reach the 100kg point sooner. If calves become ill separate them, and ideally contain them in a pen with solid walls to prevent the spread of infection to the healthy calves. Calves with diarrhoea must have a constant

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source of energy so alternate between milk and electrolyte replacement therapy. The degree of dehydration from scours can be assessed by the strength of the suckle reflex and whether or not the calf can stand. In the worst cases where calves are lying on their sides and cannot suckle they will need intravenous rehydration done by a Veterinarian.

and affection. Spending time with them each day can make a big difference. For more advice on calf health and management please contact your veterinarian.

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14 Dairy Focus August 2013

It has never been easy to achieve farm By: Richard Jones Federated Farmers Southland Sharemilkers Section Chairperson

he sharemilking system was established to enable young kiwis to build up equity in order to progress through to farm ownership. Sharemilkers gradually build cow numbers, either by raising calves or buying cows, becoming what is known as a Herd Owning Sharemilker (HOSM). They would then sell some for the deposit on a farm and stock it with the remaining cows. However, with the rapid increase in farm sizes and the price of land escalating, taking the leap up the progression ladder from Contract milker and Variable Order Sharemilker, to a HOSM is becoming increasingly difficult. The result is that sharemilkers have to stay sharemilking for longer to build their equity, slowing their progression to farm ownership. This hold up also affects farm owners when they want to exit the industry, as fewer sharemilkers will have built up enough equity to pay a decent price for the family farm. The only option available for these farm owners may be the faceless multi-national corporate, not the experienced, hands-on sharemilker. Many farm owners do see HOSM's as having too good a return on investment compared to them, relative to each party’s investment. While this is understandable, a sharemilker carries much greater risk that needs to be acknowledged. Sharemilkers to a degree have made a rod for their own backs by becoming too business-like. I know this is a generalization, but

Gen Ys in particular do not seem to understand that they are not only running their own business, but the farm owner’s as well. Far too often I hear the comment; "Well, it's not in my contract so we'll get someone in to do it and the farm owner can pay the bill". Is this the right attitude to have? As well as the change in business attitude, there is the difference in generational attitudes. Gen Ys seem to want everything today: the big business, heaps of time off and all the toys. Farm owners of today are from the previous generation and were brought up to be frugal and work 24/7. Straight away there is an underlying conflict. We all talk about "balance" in life, but your definition of balance may differ depending on your generation. The most successful HOSMs and farm owners who have come through the sharemilking system will all tell you that they have got there by being patient, working hard and smart, with limited time off and delaying getting the flash toys. They have also learned how to "straighten nails". Above all, they have fully understood the farm owner’s goals for the farm. So how can we make the HOSM the management structure of choice? The relationship between both is a partnership. A partnership, by definition, is a “joint business venture between two or more people”. Both parties are essentially in a team and a good team works for each other: there is also no “I“ in team! If you were to ask any successful

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HOSM what it is that has set them apart and made them a success, it will not be that they are any better at HR or pasture management. It will be their attitude and willingness to go the extra mile. It is the stuff they do outside of their contract that saves the farm owner money. It is the thinking they do about what is best for the whole farm business, not just their own. Here’s an example: The HOSM is in the situation that he has 40ha of silage to be made on farm. The HOSM and farm owner have also bought 40ha of standing grass to be harvested for winter feed. Which do you get the chopper to do and which goes into baleage? I'll bet the majority of sharemilkers will say, "we'll chop the stuff at home because that’s my expense and cheaper for me and put the bought in grass into bales because that’s more expensive and the farm owner pays half and I pay the other." Looking at the whole picture, the opposite gives a better win-win result. Making the bales on farm is more expensive, but if the cost savings of chopping the bought-in grass are added to the equation, the HOSM’s bill is about the same either way. The big thing though, is you could save the farm owner thousands of dollars. The other important relationship for sharemilkers is with the bank. They want to know that you can save money. If you can, they are more inclined to back you. The big question you need to ask yourself before you spend the coin is "Do I need it or do I want it?" If it’s a need,

go and buy it, but if it’s a want, leave it on the wish list for later. Here's a simple rule of thumb. For every $5,000 you spend on drawings, you can service $35,000 of debt. So if you live on $50,000 a year instead of $100,000 you will have $50,000 more available which will service $350,000. Imagine what you could do in five years of living carefully! Probably the most important aspect to establishing and maintaining a happy, healthy and prosperous relationship with the farm owner is to build your name as a top operator. The second one is to operate with the very strong core values of compete honesty and utmost integrity. What goes around comes around. If your core value is greed, then watch out! If sharemilkers actually show the farm owners that they are passionate about the success of the whole farm business and not just their own business, then I think there will be more HOSM positions available. Sharemilkers, if the farm you are sharemilking is a stepping stone on your personal journey, you still need to treat it with the greatest of respect. Maximising the profit for the farm owner as well as yourself is paramount. If you remember nothing else, remember this, "The only person who can bugger up your name is YOU" PASSION and ATTITUDE IS EVERYTHING

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Dairy Focus August 2013 15

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16 Dairy Focus August 2013

HDPE Pond Liners proving their worth When considering a suitable lining material for their effluent storage ponds, farmers in the lower South Island are increasingly finding that HDPE (High Density Polyethylene) liners provide a solution that is more than able to meet their requirements. With their regulatory responsibilities front of mind, it is vital to have confidence in the compliance of their effluent storage pond and durability of the liner.

designed specifically for flexible geomembrane applications and contains approximately 97.5% polyethylene, 2.5% carbon black and trace amounts of antioxidants and heat stabilizers. This make up gives HDPE liners outstanding UV and chemical resistance. HDPE liners have a life expectance in excess of 100 years.

HDPE liner really proves its worth with very comprehensive installation and testing procedures undertaken on site. Aspect Environmental Lining constructs HDPE pond liners on site to your unique pond specification.

AEL stands by their installation by means of full workmanship and material warranties. With such a comprehensive testing process in place during HDPE permeability rates easily installation, Aspect Environmental achieve those standards set out by Lining HDPE liners give you confidence HDPE liners have been specified regional authorities throughout New around effective effluent compliance. for containment applications in Zealand. With this in mind, if you would like any New Zealand since the early 1980â&#x20AC;&#x2122;s. product samples or sales assistance As with any product, the installation The material is a high quality regarding our services, please give us a process is key to ensuring a quality geomembrane produced from specially call on 0800 464 235. We are happy to outcome is achieved. This is where formulated virgin polyethylene help out and add value to your business an Aspect Environmental Lining resin. This polyethylene resin is where we can.

Dairy Focus August 2013 17

Longer and Less Profitable Milking R

ecent research shows that the average NZ dairy farmers are using their milking liners for an average of 4900 milkings while the design life of the only part that contacts your cows teats are only rated at 2500 milkings! More concerning is that many farmers are operating at levels well in excess of the average, are we really that clever in making our liners last at least twice their design life?

liners with reduced tension will not massage teats correctly which causes

Any rubber product exposed to frequent movement plus washing

this will show up as cracks which creates the ideal environment for bacteria to grow & be carried from cow to cow. Operators quite rightly blame the milking system for this but they need to look in a mirror for the real cause of it. Keratin containing antibacterial properties is naturally released during milking & is washed out of the teats with milk flow, this supports good udder health & results in lower infection rates but when the teats are incorrectly massaged, washout of Keratin increases leaving the udder more prone to infection.

Liners are like tyres on your car, they can be used past their WOF minimum tread depth but will have less effective braking, cornering & run higher risks of problems occurring which will let you down at the most inconvenient time, guaranteed.

Incorrect teat massaging along with restricted teat canals leads to increased strippings; this is milk left in the udder after milking. If you can hand strip milk after the machine has finished, the teats have been incorrectly massaged.

The problem with using worn liners is not just that it takes you slightly longer to milk it’s all the hidden things creating havoc around the cows udder that cost farmers a lot more lost profit than the cost of changing liners. Liners are shorter than the cups they fit into to create tension to predetermined levels, worn saggy

fluid build-up in the teat end, this in turn causes the milk canal to become restricted which slows down your milking time.

If you noticed milking time reduces & more milk in the vat after fitting a new set of liners, you should have changed your liners some time ago. Please do you & your cows a favour & replace your liners on time leaving you with a healthier herd.

with detergents will deteriorate & as time goes on the contact surfaces get rougher & rougher. When magnified

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18 Dairy Focus August 2013

Ban the plough, says scientist In Holland the first beef burger without disturbing a cow has been eaten, globally governments intend to ban smoking and, in New Zealand, a soil scientist is campaigning to outlaw the plough. World authority on soil science, Dr John Baker, says ploughing or conventional tillage contributes to global warming, crop failure, soil erosion and eventually famine in areas of the world.

He says ploughing is like invasive surgery. It releases carbon into the atmosphere which add to global warming and depletes the micro-organisms which enrich the soil. Over time tillage leads to soil erosion, crop failure and drought. Dr Baker, who has a MAgrSc in soil science and PhD in agricultural engineering from Massey University, says

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Dairy Focus August 2013 19

the single greatest challenge facing the world today is feeding the extra 50 per cent population by the year 2050. “Only four per cent of the world’s surface has arable soil and that’s not likely to increase so we have to learn to farm it more sustainably which we simply haven’t been doing,” he says. “We can get away with conventional methods in New Zealand because we have rich soil and rotating pasture, but other countries don’t have that luxury. Instead they’re turning their backs on ploughing and adopting no-tillage as the only way to feed the population.” Just as Professor Mark Post from Maastricht University says that killing cattle will become unethical and farming them for food is a costly way of using land, Dr Baker says no-tillage technology is by far the preferred way to grow food sustainably.

Professor Post has done something about his research by creating a burger made with real beef cells grown in a laboratory. He believes his product will hit the supermarket shelves in little more than a decade.

As a result he now exports to 17 countries including Australia, the United States and Canada and this year was a finalist in the World Food Prize, announced at the US State Department in June.

Dr Baker has already produced a hundred no-tillage machines. Following his 30 years of research at Massey University, he’s developed a no-tillage drill which penetrates through crop residue or vegetation on top of the ground and sows seed and fertiliser in different bands beneath it at the same time.

His technology is recognised by the United States Food and Agriculture Organisation (FAO) and the United States Department of Agriculture as the best available.

Unlike ploughing the process causes minimal disturbance to the soil, traps the humidity, preserves the micro-organisms and soil life, largely prevents carbon from escaping into the atmosphere and significantly improves crop yield.

“No-tillage is the only method of seeding that can feed a hungry world in the decades to come,” he says. “It’s that important.” And like Professor Post and cattle, Dr Baker looks forward to the day when tillage equipment comes complete with a cigarette-style warning on it.

“No-tillage is the equivalent of keyhole surgery as opposed to ploughing which is invasive surgery,” he says.

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20 Dairy Focus August 2013

Changes expected to have major impact on dairy farmers By Tony Marshall

he Inland Revenue Department has announced that fundamental changes are going to be made to the National Standard Cost (NSC) valuation methodology for dairy cattle that will increase livestock values commencing from the 2014 income year. While there are a variety of livestock valuation methods available to farmers, the valuation methods most commonly used are NSC and the Herd Scheme. As a result, the changes will have a wide ranging impact on dairy farmers. You might be thinking, well why do I care about a change in valuation methodology? The reason why this change is important for dairy farmers using the NSC valuation method is that any increases in value arising under the NSC valuation method are taxable income to the farmer. This will see an increase in taxable income for all dairy farmers using the NSC valuation method. The change in methodology is likely to see increases in livestock carrying values for farmers using NSC of approximately $400 per head for rising two year old livestock. This will also have a flow on effect into the value of mixed age cows in future income years. For a dairy farmer with 100 rising two year old heifers on hand at balance date, an additional $40,000 of income will arise solely from a change in the valuation methodology in the 2014 income year. The fundamental driver behind the change is that the existing NSC methodology had not kept up with current New Zealand farming practices in terms of the

costs incurred by a farmer in growing a rising one year old animal into a rising two year old animal during the course of that year. In the 2013 financial year, the NSC of growing a rising one year old animal into a rising two year old animal was $119.20 per head. Under the revised methodology, it is likely to be somewhere in the vicinity of $500 per head. To understand why the change has been made, it is important to understand the methodology behind the NSC valuation method. NSCs are calculated using an approved methodology where direct costs of “breeding”, “rearing” and “growing”, immature livestock are taken into account to determine a national average cost of production for each type of livestock. The NSC figures are supplied to the IRD under contract with Beef + Lamb New Zealand’s Economic Service, using actual ‘on farm’ cost data from representative sources. Where the existing methodology fell down is that it has not changed to take into account the trend of dairy farmers treating the dairy farm solely as a milking platform with replacement stock being predominantly reared off-farm. Previously, replacements were more often reared on farm or on a run off block owned by the dairy farm operator. It is the inclusion of the additional grazing costs in the NSC valuation methodology that will result in the sharp increase in value. NSC was designed to ensure that each individual farmer would not need to suffer the high cost of undertaking their own full scale cost allocation accounting system to value livestock. NSC generates values that are

acceptable to both farm business and the IRD, except for anomalies that have developed over time, such as the one being addressed with these changes. The IRD has recognised that such a fundamental change, which will bring with it increased income for dairy farmers, cannot be brought in in one foul swoop. Accordingly, the change will be phased in over three income years commencing with the 2014 NSC Determination. For those of you valuing your dairy cattle using NSC, you will see increased values and increased taxable income over the next three years as a result of the change. As such, it may be an opportune time to reconsider what valuation options you will use, and in particular whether it is a opportune time to enter the Herd Scheme, particularly given the drop in herd scheme values for the 2013 year. Farms should bear in mind, however, that once they have chosen to value their livestock under the Herd Scheme, this is an irrevocable election following changes to that valuation method as a result of changes introduced as at 18 August 2011. In any event, how your livestock is valued requires careful consideration on an annual basis to ensure that you are obtaining the best possible outcome each year.

Tony Marshall is a Tax Advisory Principal with Crowe Horwath in Dunedin.

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Dairy Focus August 2013 21

Gas water heating system fast and efficient for dairy sheds A

new gas water heating system for New Zealand dairy sheds is designed to reduce water heating costs by up to 50 per cent and improve flexibility for the farmer. The Bosch dairy hot water system is a New Zealand first and is now available exclusively through Longveld On Farm in a collaboration between Longveld and Bosch Hot Water & Heating Division. The two companies have been developing the system for the past 12 months using the Bosch 32 continuous flow commercial water heater and Longveld On Farm’s engineering and installation capabilities. Longveld Managing Director, Les Roa, says the key benefits of gas water heating in the dairy shed are the lower costs of water heating, and the flexibility of having hot water in the shed whenever it is needed for multiple hot wash uses every day, with both benefits increasing overall efficiency. “Electric heating is just too slow to give farmers hot water when they need it.” “Farmers have to skip a plant or vat wash at times because they don’t have enough hot water, especially if the tanker pick-up time changes unexpectedly” he said. “With gas water heating the water is only being heated for an hour or so before you need it then the system switches off,” he says, “but on electricity your meter is probably running 24/7 and electricity rates continue to climb.” “The Bosch dairy hot water system can be programmed

to start automatically so at 5am there’s a full tank of hot water and then another full tank of hot water at 3 or 4pm – in fact at any time the farmer wants it.” Mr Roa says the system will cut day to day water heating costs by up to 50 per cent. On larger farms with cold bore water this translates into a payback period as low as two years. Mr Roa says farmers are increasingly aware of the need for their milking systems to be fully compliant in all aspects of food production, especially in light of the recent Fonterra food safety scare.

“The Bosch dairy hot water system delivers this.”

“Our dairy farmers are the first link in a global food supply chain where food safety is number one,” he said. “Effective cleaning systems are imperative, and this requires sufficient volumes of hot water on tap to fit the flexibility a modern farmer demands.”

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22 Dairy Focus August 2013

Research shows - hit lepto before it’s too late

road show around New Zealand this spring is aimed at veterinarians to lift vaccination programme awareness, and the need to vaccinate young stock earlier against the disease leptospirosis.

Leptospirosis is often mistaken for a bad bout of the flu by farmers, but is a disease almost entirely avoided if effective1/2PG vaccination ST 2013—hANhAm ADVERT of livestock takes place. Dr Roger Marchant, veterinary advisor to the New Zealand Veterinary Association’s (NZVA) Leptosure® programme is urging farmers to head off the risk of leptospirosis infection, for themselves, their family, their staff and their animals by making sure their animals are

vaccinated at the right age.

This rate puts New Zealand in the top bracket globally for serious human leptospirosis infections.

“The typical pattern for leptospirosis vaccination has not changed much over the years. That’s been to vaccinate calves at around six months of age. However we can now be more specific about the timing and vaccination needs to be earlier than this to be fully effective.”

It is also a disease with insidious downstream affects through the rural community beyond the farm gate. Back in 2008 a meat worker died from the disease, and process workers have a one in 20 chance of contracting the disease through infected carcasses. The estimated annual incidence in veterinarians is 3 per cent.

Farmers and veterinarians are in the front line for infection risk with about 120 reported human cases in New Zealand each year. However, as reported at the recent NZVA conference, estimates of under reporting may mean that the number of cases could be up to 40 times greater.

The Leptosure programme has previously recommended the practice of vaccinating around three to six months. However a revamp of the Leptosure guidelines is underway, with new ‘best practice’

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Dairy Focus August 2013 23 vaccination standards coming out later this year. A key aim is to get vaccinations completed earlier before calves become infected, but not too early since maternal antibodies may interfere with the vaccine. Concern over the mixed messages behind vaccinations prompted the NZVA to initiate a review by Massey University Epicentre on leptospirosis disease incidence. This work reported on the possibility of increased risk of leptospirosis infections in herds where calves had not been vaccinated until six months of age. A small pilot study by Massey showed 30 per cent of apparently vaccinated herds sampled tested positive for leptospirosis, and 13 per cent of cows in these herds could have been shedding the bacteria. The risk of having a herd with one or more cows shedding leptospirosis bacteria appeared to be associated with the age at which calves were vaccinated for the first time. Dr Marchant said the window of infection risk was there when vaccinations were not conducted until six months of age. “An animal may well be infected with leptospirosis prior to that, and even if it does get vaccinated, that will not eliminate the infection.” From the Massey review the Leptosure best practice advice now is earlier vaccination than previously recommended, but not too early: for the average mob age of dairy calves the first vaccination needs to be about seven weeks of age on a farm with a high leptospirosis risk. For a typical dairy farm that equates to 10 weeks after the seasonal start of calving as the earliest time, with a second shot administered four to six weeks after the first.

complete these two shots before 6 months of age. A “high risk” farm is one that experiences high rainfall in spring and summer, flooding and water-logged paddocks, maybe has a history of leptospirosis infection, has a rodent population, and livestock that may have contact with un-vaccinated animals, especially when grazing off-farm, or with bought in seasonal grazing stock. For beef farmers the principles remained the same, vaccinating calves before the risk of exposure to infection develops. Ideally dairy grazers coming onto a beef property should have full proof of vaccination prior to arrival, and all beef stock on the property should be vaccinated. Animal health company Zoetis is working with Leptosure to get the message out about the need to ensure farmers understand the need to vaccinate earlier. Zoetis market development manager and veterinarian Dr Wayne Clough said research has shown that leptospirosis vaccines were effective in preventing leptospire shedding when administered prior to infection. “But these are bugs that do not play by the book, and the longer an animal has not been vaccinated, the more likely it will become infected and shed leptospirosis bacteria. Then vaccination is simply too late.” Zoetis has recently completed trials that confirm the efficacy of Ultravac® 7 in 1 when administered to calves at six weeks of age. “This is about delivering better protection not only to your stock, but also to yourself and your staff, it’s a nasty disease we do have effective vaccines for, it just needs to be headed off earlier,” Dr Clough said.

Even on low risk properties, farmers should aim to

Roger Marchant wants stock vaccinated to reduce the number of people contracting leptospirosis.

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24 Dairy Focus August 2013

Cows acting lame? Fred Hoekstra Veehof Dairy Services

re you ready for the new season? When it comes to being organised with staff and machinery you probably are, but what about lameness? Or, are you like many who believe they won’t get lame cows this year? It is a bit like a new year’s resolution. I guess it is understandable that people have every intention of doing their best in keeping lameness down, but how are they going to achieve it? It is not going to happen automatically. You require a strategy, but in order to have a strategy you need a good understanding of the contributing factors of lameness. I have written many articles about these factors and I will continue to do so, but what are you going to do when you do end up with lame cows, and you will get lame cows. How many lame cows do you need before you consider it a problem? Would you consider five lame cows in your lameness herd throughout the season a problem? I know that many farmers would be more than happy if they only had five lame cows in their lameness herd throughout the season. Let’s break it down. If you have a milking season of 40 weeks and if cows are lame on an average of four weeks then you will have about 50 lame cows that season because you replace the five lame cows every four weeks, so, over 40 weeks you

replace them 10 times. 10 times five are 50. How much does a lame cow cost you? That also depends on who you talk to. Some people say $50 and some people say a thousand. A few years ago we sent out a questionnaire to 300 dairy farmers. With the answers that farmers were coming back with, we worked out that the average cost per lame cow in Canterbury was around $1200. That may seem very high but if you have a cow that is not in calf because of lameness then you have to replace that empty cow with a cow that is in calf. That in itself would cost you over $1000 without the treatment cost or loss of production cost added on. Then there are also plenty of cows that need to be culled because of lameness even though they are in calf. So I think you should work with a cost on average of $500 per lame cow. That is possibly still on the conservative side, but in our example of 50 lame cows during the season you have a cost of $25,000. I don’t know about you but there are many good things that I could do with $25,000! In my travels I come across many farmers who haven’t thought about the cost too much. I am just trying to put things into perspective. There are plenty of new milking sheds being built that have no facilities to trim cows. Some people seem to find it hard to justify buying a crush or doing a hoof trimming course because they don’t have many lame cows. You don’t need many lame cows to have a problem that costs you lots of money, let alone considering the animal welfare costs.

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26 Dairy Focus August 2013

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id Canterbury company RX Plastics, an innovator in the irrigation market, has launched a new addition to its range of robust irrigation solutions designed for a range of terrains and budgets. RX Plastics is the manufacturer and distributor of the ubiquitous K-Line Irrigation pod and sprinkler system which can now be seen on farms throughout New Zealand, Australia, North and South America. The company is known for an on-going commitment to research and development, which has led them to their latest innovation, the G-Set irrigation system. “We listen to feedback from our customers and have responded with a solution that we believe fits a specific gap in the market for an efficient, highly functional system that irrigates more challenging areas,” says RX sales and marketing manager Phil Gatehouse.

G-Set is an embedded irrigation system that can be installed anywhere that irrigation pipe can be run, making it suitable for more difficult terrain, hill slopes and irregular shaped pastures. “This solution means that farmers can effectively ‘farm for rainfall’ – so they are not overwatering and wasting a precious resource. If there is sufficient rainfall, they simply don’t turn on the system for the day or the week. Otherwise, it operates each day as required.’ Mr Gatehouse says the initial target market is to provide irrigation for farmers to cover the difficult to irrigate areas. “G-Set is ideal for irrigating pivot corners,” he says. “The pods and pipe can be installed and then are run automatically from the house or wherever the computer controller

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Dairy Focus August 2013 27 is located, meaning no additional labour is required to shift or turn them on and off.” Each of the G-Set pods is set in the ground and protects a sprinkler and a control unit, which may be battery, solar powered or mains supplied. The pods are made of the same robust rotomoulded plastic as K-Line, but have a distinctive blue colour to ensure they are easily seen when farmers are working a paddock. The new system was introduced at this year’s Mystery Creek Fieldays and so far has generated a high level of interest from farmers all over New Zealand, but the product is likely to go beyond New Zealand shores. G-Set has been patented for a number of international markets. Mr Gatehouse says the first trial installation of G-Set units is currently going into a farm in the Waitaki Valley, and the company has started to ramp up production capacity to start taking orders. Because RX Plastics doesn’t sell directly to the public, the company has been working closely with irrigation companies to show them the potential of the product and how it can be best implemented for different irrigation requirements. “This is a significant innovation for New Zealand farms, given the reliance till now on large and expensive installations of centre pivots or travelling irrigator systems. While K-Line has also been ground-breaking and is particularly suitable as a cost-effective solution, G-Set removes the need to relocate the sprinkler pods regularly, so there is virtually no labour cost involved.”

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28 Dairy Focus August 2013

Risk of more bans on dairy exports By Adam Bennett and Christopher Adams of the NZ Herald

rade Minister Tim Groser warns further international bans on New Zealand dairy exports remain a real threat after the Fonterra botulism scare, which claimed its first scalp with the resignation of executive Gary Romano.

Mr Romano, Fonterra’s managing director of milk products, took a leading role in fronting over the botulism scare two weeks ago, but resigned last week. While there have been calls for heads to roll over the discovery of botulism-causing bacteria in Fonterra-produced whey protein concentrate, Fonterra chief executive Theo Spierings said Mr Romano’s resignation was “his decision”. Mr Romano’s resignation came a day after reports of a ban on Fonterra products by Russia, Kazakhstan and Belarus were officially confirmed. Russian media have reported the bans are unlikely to be lifted this year. Russian Federal Veterinary and Phyto-Sanitary Oversight Service head Sergei Dankvert told news agency Interfax authorities would want to inspect Fonterra facilities before lifting the ban but their inspection schedule for this year was full.

“We’ve been saying right along that we should expect, given the uncertainties around this, that the tide can still go out.” Market commentator Arthur Lim said there was strong sentiment in China that a senior Fonterra staff member needed to be held responsible for the botulism scare and Mr Romano’s resignation would keep the Chinese happy, in the short term. “My sense is that Fonterra is half waking up to how serious the situation is.” Federated Farmers dairy chairman Willy Leferink said Federated Farmers was “utterly shocked” at Mr Romano’s resignation. It had “come out of nowhere.” “It’s a sad day. I think he took personal responsibility for some of the issues and the pressure got too much for him.” Former dairy chairman Lachlan McKenzie said New Zealand farmers were still waiting for the “full story” from Fonterra. “The problem we still have is we do not know the full story.”

“So now only next year,” he said.

“It’s just probably more confusing now than ever,” he said.

Fonterra’s director of communications, Kerry Underhill, said the company was “hoping the suspension will be lifted as soon as possible and we are working hard with the appropriate authorities to make this happen”.

Results of Fonterra’s inquiry needed to be made available as soon as possible, Mr McKenzie said.

Mr Groser said further bans remained a risk.

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16/07/13 10:25 AM