Dairy Focus March 2012

An Ashburton Guardian Supplement

FOCUS Issue 46 - March 20, 2012

Converting to dairy Pages 12-20 NZ Dairy Industry Awards Pages 6-10

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2

Herd scene with Hamish Hamish Davidson n d Mid Canterbury Federated Farmers’ dairy section head

T

he last month in the life of Federated Farmers Dairy has been one of the busiest I can remember and dominated by two major issues: Dairy Industry Restructuring Act (DIRA) and Raw Milk Regulations, and Trading Amongst Farmers (TAF).

Federated Farmers has made submissions to MAF pointing out that any changes to the DIRA relating to Trading Amongst Farmers (TAF) must be halted until Fonterra shareholders have seen, and explicitly endorsed, the value proposition of Fonterra’s capital restructure. Legislative change must not drive Fonterra’s capital restructure. The federation agrees that sunlight and transparency is good for all when it comes to the milk price. The milk price is key to the Raw Milk Regulations, the setting of the Fonterra share price, Trading Amongst Farmers (TAF), consumer milk prices and the price that farmers get for their milk at the farm gate.

The federation therefore welcomes having the Fonterra Milk Price Manual in the public arena and the oversight the Commerce Commission will have on the milk price. The federation, however, rejects government intervention on the way Fonterra sets its shares.

Fonterra and its shareholders must be left to set the share price as they see fit. In our submission on the Raw Milk Regulations, the federation said minor adjustment was needed to make them work better.

We gave some options that could be used to tie the milk taken by independant prossesors over the seasonal curve to that taken at the peak of the season. We also suggested that those independent processors, with their own supply who were established before June 2008 should have their 50ML allocation ramped down, with zero entitlement by 2015/16. The biggest disappointment in the proposed changes is the complete freedom for those independent processors without their own supply (or below 30 million litres a year) to keep taking this milk at a regulated price forever.

We pointed out to MAF that it only needed ten independent processors to take their full allocation of 50 million litres to spark over demand for the milk and suggested that it would be better to deal with this problem now, than later. We also pointed out that leaving these independent processors free to keep taking

this milk would not provide greater competition at the farm gate, something that MAF is keen to do.

Trading among farmers (TAF) As most dairy farmers may be aware a confidential letter we sent to Fonterra Co-operative Group’s chairman and board, following the 2012 Dairy Council meeting in Palmerston North, was leaked to the media.

Regardless of how it got into the public domain, it was not the ideal scenario we had planned. To prevent further speculation on what the letter may or may not contain we released the letter to our members.

The intention of the letter was to robustly and independently represent the concerns of our dairy members who make up, of course, the majority of Fonterra’s shareholder-suppliers. The letter in brief contained the following: An expression of our deep concern in how TAF and its details have been presented to the shareholders of Fonterra.

Neither the advantages nor the disadvantages have been fully or well explained, nor the outcome if either comes to bear. In short, we have not seen the value proposition which we were told in 2009 would be presented to us after all the details had been worked out.

We have no concerns with the actual “trading amongst the shareholders” part of TAF. But we are particularly concerned about four issues that hang to the side which, as you yourself have said, you will need to have to make TAF work. The ability of the regulator and others with vested interests in their investments, as proposed in the DIRA, to control or influence the Milk Price model. This model is instrumental in calculating the Dividend stream in the future.

Once the Shareholders’ Fund reaches the total amount of shares issued by Fonterra, as currently proposed in TAF, there is the potential to block changes to Fonterra’s Constitution, as these need a 75 per cent majority The governance model of the Shareholders’ Fund and the Custodian, as set out in the current proposals before the Government is hard to swallow for farmers who put Fonterra together with “blood sweat and

An advertising supplement of the Ashburton Guardian

FOCUS

In the meeting of the Federated Farmers Dairy Council in Palmerston North, attended by over 50 members from Southland to Northland, we heard presentations from two Fonterra directors, the Minister of Agriculture and the Chair of the Shareholders’ Council. After discussion, the next day a motion was put and after a vote it was turned into a remit. The remit reads as follows: That Federated Farmers Dairy strongly recommends the board of Fonterra take the finalised TAF proposal, inclusive of proposed DIRA TAF provisions, back to shareholder suppliers for another vote.

It is our view that the evolution in detail and complexity inherent in the TAF proposal, and yet to be released information, relative to what was initially voted on, deserves further consultation, understanding and debate among shareholders before it is advanced fully.

It is the Federation’s view that the current TAF proposal compromises the cooperative values and presents real risks to supplier shareholders maintaining 100% control and 100% ownership. This was carried unanimously.

With TAF we are turning to a new chapter in Fonterra’s existence. We are not the ones who would like to be remembered in 30 years time as the ones who sat back and allowed Fonterra’s final chapter to be written.

It is the farmer shareholders who created Fonterra, with the permission of the government. We do not want anybody to destroy this. It is our co-op and it is our right to be informed and informed in such a way that we can see the whole picture, not just parts of it.

We are all adamant we are not going to “Trade Away Fonterra”. Watch this space.

We welcome any correspondence to either:

Opinions expressed in this publication are not necessarily those of the Ashburton Guardian Publication date: Next issue:

tears”. With the introduction of the Shareholders’ Fund and its ability to dissolve, as currently proposed in TAF and the DIRA, comes the re-emergence of the redemption risk, which was one of the key issues TAF was meant to resolve. We are extremely worried that the Shareholders’ Council will not have all the information to make an informed judgement and nor will the farmer shareholders.

Amanda Niblett, phone 307-7927 email: amanda.n@theguardian.co.nz or Linda Clarke, phone 307-7971 email: linda.c@theguardian.co.nz

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Fonterra at a crossroads Willy Leferink k n Chairperson Federated Farmers’ Dairy Section

A

s an immigrant, I’ve worked my way from being a farm worker in Taranaki to farm ownership in Canterbury. That is the opportunity New Zealand’s dairy industry has given me and I am not alone.

It’s also why I remain unconvinced about plans for a Fonterra shareholders fund.

The future of Fonterra affects everyone as it is our one true multi-national. Best of all, Fonterra is mostly owned by New Zealanders. What it earns comes back here, to its farmer-shareholders and ultimately, back to the communities in which these farmers live. Fonterra’s proposed Trading Among Farmers shareholders fund will control up to eight per cent of Fonterra worth up to $500 million.

The fund is a potential solution to a hole in Fonterra’s balance sheet called redemption risk. Right now when a farmer leaves the cooperative, their equity must follow within 30 working days of the season ending. This hole is why two years ago, some 90 per cent of Fonterra’s shareholder-suppliers voted to change the cooperative’s capital structure.

While the proposed shareholders fund was light on detail at the time, it was proposed as a balance sheet ‘shock absorber’. The idea is the fund will buy shares off farmers with the dividend income enticing ‘mum and dad’ investors to buy ‘units’ in the fund. Fonterra gets a $500 million shock absorber and unit holders get a safe investment.

Two years on and Federated Farmers Dairy council has asked Fonterra’s board to consider a second vote. This request isn’t made lightly. If, as we’re told, there is overwhelming shareholder support for the fund, then a second vote will confirm it.

Federated Farmers members, who make up a majority of Fonterra’s shareholder-suppliers, seem to be increasingly uneasy. As they see it the 2010 vote wasn’t a blank cheque. Following comments from the Prime Minister that he’d like to see our company on the stock exchange, farmers are nervous about external interference and from Government especially.

Fonterra is our company and Fonterra’s future must only be decided by those who own it. As I am of Dutch extraction, my family’s experience is directly relevant. The old Friesland/Coberco in what is now RoyalFrieslandCampina started down a similar path but stopped. It stopped because ex-farming ‘dry’ shareholders started to dominate decision-making and that affected the farming ‘wet’ shareholders. It seems the investment outlook of ex-farmers changes radically when they exchange the farm for a dividend.

As proposed, the unit holders in Fonterra’s shareholder fund won’t get a say in Fonterra in exchange for their cash. As farming has its ups and downs, the notion of 100 per cent farmer control may become moot over time.

For two seasons in the past decade, dairy farm-

Fonterra milk plant. Federated Farmers members are uneasy about what they see as external interference in the co-operative’s structure. ers have done it tough financially. Imagine if a ‘white knight’ shareholders fund offered to buy shares from farmers desperate to keep creditors at bay. It would be hard to resist. Tough times can provide the motivation to overcome constitutional impediments, even if the fund’s expansion came with strings attached.

With no clear boundaries it’s a brave person who’ll place hand on heart and say the shareholders fund will only ever be eight per cent of Fonterra. While Fonterra can promise safeguards to protect its ‘wet’ farmershareholders against ‘dry’ unit holders, time and economic circumstance could erode that. The Judicial Review of the Crafar farm sale also shows how a legal challenge can turn things on their head.

Optimists believe the shareholders fund will help turn a large base of urban ‘mum and dad’ investors into farmer cheerleaders.

Pragmatists argue the actual number of individual investors in the fund will be tiny. Speaking on radio, First NZ Capital’s Peter Corban said Fonterra’s shareholder fund would be “good news” for Kiwisaver and the New Zealand Super Fund. How many individual investors will get their piece of the dairy action? Precious few.

that produced iconic Kiwi brands like Steinlager and Lion Red. It took only the 1990s for Lion to slip out of New Zealand ownership and out of New Zealand. Lion is now part of a Japanese company headquartered in Sydney.

The best safeguard to keep Fonterra New Zealand owned and controlled is for the owners to be those who get up at 4am to milk cows. Compared to the number of corporate train wrecks littering New Zealand’s history, Fonterra hasn’t done too bad being owned by savvy, if demanding, farmers. In fact, it’s become a world beater with plenty of ‘A’ passes in a recent dairy co-operative survey.

That’s why we want the full shareholders fund proposal put to farmers. Much in Trading Among Farmers makes sense, but the fund stands out like the proverbial on a bull. The current review of the Dairy Industry Restructuring Act actually hangs on Fonterra having a shareholders fund. The best course is to decouple the proposed fund from Trading Among Farmers and have an open discussion among farmer-shareholders. Relying on a 2010 vote for what was conceptual at best, belies the fact Fonterra is in good financial health. Time is on our side and we advise Fonterra’s Board to take it.

Willy Leferink Chairman, Federated Farmers Dairy

The fate of Lion Nathan further highlights our concerns. Here was a brewer as old as New Zealand

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ATS Dairy Days Out A

TS is delighted with the response to its inaugural Dairy Days Out and is planning a repeat of the event next year.

General manager of operations Jono Pavey said he hoped the Dairy Days would become cemented on dairy farmers’ calendars.

Several hundred people visited the giant marquee erected in the ATS Ashburton carpark, where businesses serving the dairy industry displayed a wide variety of products and services. Knowledge, expertise and innovation were on display, with products aimed at increasing milk production and pasture growth, animal health and farm management. “The majority of the visitors were dairy farmers and the good thing about it was they were there with a genuine interest in buying or seeking information from suppliers. The feedback was it was a great atmosphere with a lot of knowledgeable people under one roof and farmers could seek information and make some purchasing decisions for the coming season while taking advantage of some great deals.�

Mr Pavey said ATS’s dairying business had grown significantly in the past four years, to keep pace with the dairying boom in Canterbury. “Four years ago we didn’t have a dairy rep, and now we have three. It is becoming a significant part of our total sales, whether it be retail or card suppliers and it is growing with more conversions.�

Feedback from farmers has been positive regarding the relevance the suppliers present, the timing of the event and the deals on offer, he said.

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Keep it low D

airyNZ is searching for prize dairy effluent storage ponds in the first ever New Zealand Prize Pond 2012 Awards.

the risk of running into problems when the seasons change.

Farmers who are keeping their effluent storage ponds as low as possible are being asked to send DairyNZ a photo of the pond to be in to win one of two DairyNZ Prize Pond 2012 Awards.

DairyNZ project manager for effluent Dr Theresa Wilson says low ponds have storage capacity which reduces

“We’re after the two best operational dairy effluent storage ponds that meet relevant consents and the requirements of your farm.

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“And we want to see that you are keeping it low. “When the wet weather starts, it’s good to know you’ve got as much free storage as possible in your effluent storage pond.�

Enter the competition to be in to win: • a catered barbecue for you and 10 of your mates with former All Black prop, TV sport commentator, radio personality and farmer, Richard Loe • a polo shirt with Keep it Low! cartoons on it • a magnetic fridge pond gauge.

All entrants who meet the requirements will receive a prize pond pack.

To enter, send a photo of your pond to keepitlow@ dairynz.co.nz by March 30 2012. Visit dairynz.co.nz/ prizepond for competition details.

Winners will be announced in April.

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Dairy Industry Awards T

he winners of the Canterbury/North Otago Dairy Industry Awards will be announced at a gala dinner at Hotel Ashburton on March 28.

â&#x20AC;&#x153;The awards provide an opportunity for us to better ourselves and our business while building strong networks and friendships with other like-minded, progressive farmers and rural professionals from around the country. Being a regional convenor is an extension of that.

Regional convenor Shelley Singer says the region received 65 entries across the Sharemilker/Equity Farmer of the Year, Farm Manager of the Year and Dairy Trainee of the Year competitions â&#x20AC;&#x201C; beating last yearâ&#x20AC;&#x2122;s entry tally by two.

â&#x20AC;&#x153;Many of the people we have met are at similar stages in their careers to us and have become friends.

We can visit them throughout the North and South Islands.

â&#x20AC;&#x153;It is a great result and weâ&#x20AC;&#x2122;re obviously pleased at the high level of interest in the competitions. Canterbury has had a great summer for grass growth and dairy farming, so that all helps to generate positive thinking and attitudes heading in to the awards dinner. â&#x20AC;&#x153;The number of entrants and favourable farming conditions will ensure there is a tight contest between entrants to determine the regionâ&#x20AC;&#x2122;s winners.â&#x20AC;?

â&#x20AC;&#x153;We hope this yearâ&#x20AC;&#x2122;s entrants, whether they win or not, also gain some benefits from their participation.â&#x20AC;?

The three Canterbury North Otago regional winners will each progress to the national finals in Auckland on May 12. TV3 news presenter Mike McRoberts has been confirmed as MC for the event.

Ms Singer and partner Graeme Wall won the 2009 Canterbury/North Otago Sharemilker of the Year title, and is convening the awards for a second time.

Canterbury/North Otago representatives have won the coveted New Zealand Sharemilker of the Year title three times in the competitionâ&#x20AC;&#x2122;s history.

She expects about 400 people to attend the awards night.

Shelley Singer â&#x20AC;&#x201C; pleased at the high level of interest in the Dairy Industry Awards.

The last Canterbury/North Otago winner was in 2007 when Matt and Julie Ross won the competition.

The other winners include Leo and Kathryn van den Beuken in 2005, and Geoff and Lynn Walker in 1993.

change venues at the last minute. We are also pleased the region has continued to attract such high numbers of entries, which goes to show people just want to get on.â&#x20AC;?

In 2006 Canterbury North Otago Farm Manager of the Year winners, David and Shirlene Cochrane, went on to become the New Zealand Farm Managers of the Year.

She says a benefit of being the regional convenor is working alongside other people passionate about the awards.

Tickets to the Canterbury North Otago awards dinner cost $70 and can be purchased by emailing Carmen Ryan at carmen_ryan@westpac.co.nz

â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s going to be a great night and the room will be full of the regionâ&#x20AC;&#x2122;s whoâ&#x20AC;&#x2122;s who in the dairy industry.â&#x20AC;?

Ms Singer says it has been a rewarding experience to convene the regional competition and is particularly pleased at how the region has rallied after the earthquakes. â&#x20AC;&#x153;The planning and organisation is certainly going more smoothly than last year, when we were forced to

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Dairy Industry Awards T

he build-up has intensified as entrants in the 2012 New Zealand Dairy Industry Awards compete for regional titles and the opportunity to progress to the national finals in Auckland.

Awards management executive chair Matthew Richards says there is considerable excitement around the awards at this time of year as judging is completed and the 36 regional winners in the Sharemilker/Equity Farmer of the Year, Farm Manager of the Year and Dairy Trainee of the Year contests are named.

thinking around modern farming practices and techniques â&#x20AC;&#x201C; we are not bringing up third or fourth generation farmers that are doing it like dad did it. â&#x20AC;&#x153;We will be taking to Auckland guys and girls who are using the latest technology and innovation to succeed.

Many started with nothing and are now running multi-million dollar businesses. Thereâ&#x20AC;&#x2122;s some exciting talent out there.â&#x20AC;?

Mr Richards says holding the event in Auckland will also better enable industry, business and political leaders to attend.

Mr Richards, a Southland Minister for Primary IndusMatthew Richards â&#x20AC;&#x201C; Auckfarmer, says holding the national tries David Carter has already land venue for dinner of awards dinner in Auckland holds confirmed his attendance for the special significance. special significance this year. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s national finals on May 12. been 10 years since we were last there and we really want to show New Zealand â&#x20AC;&#x201C; and AucklandMr Carter says he is looking forward to meeting ers especially â&#x20AC;&#x201C; that dairy farming is striving for the regional finalists and to experience their enthuexcellence and best practice. â&#x20AC;&#x153;We are not going to siasm for the awards and the dairy industry. bring our cows and tractors with us. We have taken it to Auckland to showcase excellence and the best â&#x20AC;&#x153;The awards are an excellent way to identify and of the up-and-comers in the industry.â&#x20AC;? promote talent within the industry and to share information and knowledge to help entrants improve He says dairy farming is a business and it is that the performance of their business or their own side of the industry, and the people within it, on personal development. show. â&#x20AC;&#x153;We are not just overalls and gumboots and we donâ&#x20AC;&#x2122;t just harvest milk for a living â&#x20AC;&#x201C; thereâ&#x20AC;&#x2122;s very â&#x20AC;&#x153;The opportunity to learn what the finalists are important business that we do. The farmers in our doing on their farms and how they are progressing awards are striving for sustainability on their farm within the dairy industry will be most interesting. I and have been brought up with new generational am sure I will be impressed.â&#x20AC;?

MORE REWARDS FOR WINNERS

T

he three 2012 Canterbury/North Otago Dairy Industry Awards winners have the opportunity to gain further recognition and reward as they head to the national final in Auckland on Saturday May 12.

The trio will line up against other sharemilker/equity farmer, farm manager and dairy trainee regional finalists to determine who will take home the prizes, worth nearly $140,000, and national honours.

The prize pool for the New Zealand Sharemilker/ Equity Farmer of the Year is valued at $83,000 with the winner taking home prizes worth nearly $36,000. The runner-up will receive $16,000 in prizes and the third place-getter will take home prizes valued at more than $11,000. A further $20,000 in cash and prizes will be won by the winners of the nine merit awards.

The New Zealand Dairy Industry Awards are supported by national sponsors Westpac, DairyNZ, Ecolab, Federated Farmers, Fonterra, Honda Motorcycles NZ, LIC, Meridian Energy, Ravensdown and RD1, along with industry partner AgITO. The 12 regional finalists competing in the New Zealand Farm Manager of the Year will compete for a total prize pool of nearly $43,000, with the winner taking home nearly $23,000 in prizes. The runner-up will receive prizes worth $9000 and the third place-getter will win $3000 in prizes. Four merit awards are worth another $8000 in cash and prizes to the winners.

A total of $12,500 is on offer to those competing for the New Zealand Dairy Trainee of the Year title, with the winner collecting prizes worth $7500. The runnerup receives $3000 and the third place-getter $2000 in prizes.

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Dairy Industry Award finalists Canterbury/ North Otago region

It is their second time entering the awards, where they hope to surround themselves with positive like-minded people. “We want to raise our profile and develop our business.”

They say the contest gave them the opportunity to take a good look at their business and scrutinise it, as well as benchmarking it against the best in the industry.

Sharemilker/equity farmer of the year finalists: Glen and Wendy Drummond farm at Culverden, where they are 50:50 sharemilkers with farm owner Rod Thomson. Two-year-old daughter Sophie keeps their life busy.

The farm milks 430 cows, with a seasonal production of 170,000kgMS. Effective hectares total 120ha.

They have entered the competition once before and are back for more. “We want to analyse our business, put procedures into place, find out what we do well and what we can improve on.”

Enda and Sarah Hawe milk 1410 cows on Valetta Westerfield Road, in Mid Canterbury.

They are lower order sharemilkers for Ben and Shannon Johnson, and have two children Niamh and Kayleigh.

On 370 effective hectares, the herd produces 600,000kgMS annually.

Enda and Sarah Hawe It is the third time they have entered the awards and they see it as a way of raising their profile in the industry. “It’s also about networking with like-minded people.”

The couple see the awards as a tool to achieving their goal of farm ownership one day. Irish-born Enda loves living in New Zealand, and says the scope and scale of dairying here allows him to achieve dreams and goals.

James and Belinda McCone James and Belinda McCone, and children Fergus and Max, live at Waiau, where they are equity farm managers on a 1150-cow farm owned by L. H. Dairy Ltd. Farm effective hectares total 328, and the herd produces 485,000kgMS a season.

They are new to the competition, but hope it will improve their business and help get policies and procedures up to standard.

They also see it as a way or raising their profile within the industry.

Earl and Melissa McSweeney have three children, Ella, Caden and Rylan, and are equity farm managers for Alford Forest Dairies on Forks Road, at Alford Forest.

They milk 840 cows on 240 effective hectares, with production for the season 350,000kgMS. Benchmarking their operation against other top performers, the challenge of the competition, and creating opportunities for the future are their reasons for entering.

They have the experience of one previous competition to help them prepare.

Boyd and Annette Slemmint are lower order sharemilkers for Dairy Holdings, farming at Oxford with their children Nicholas, Connor and Sonja.

They milk 750 cows on 224 effective hectares. Production for the season is 280,000kgMS.

Oamaru couple Hayden and Robyn Williams are 50:50 sharemilkers for Dennison Farms.

They milk 560 cows, on 153 effective hectares, with a production of 235kgMS. They are newcomers to the competition, but wanted a chance to focus on their business and better understand it.

The Williams say they also look forward to networking with other good farmers. “We are very excited to be part of such a progressive industry.”

Farm manager of the year finalists: Shannon Croy – the third time he has entered the contest.

Shannon Croy is married to Sarah and lives with their two boys Jack and Charlie on Reynolds Road, near Methven, where he is a farm manager for Waimana Dairies.

The farm milks 500 cows on 134 effective hectares.

Production for the season is 250,000kgMS. It is the third time he has entered the contest and says it is a great way to meet forward-thinking people.

“The feedback from judges is very helpful for not only the way I run the farm, but also for personal

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9

Dairy Industry Award finalists growth. The networking at the dinner opens up lots of opportunities for the future. I have been very lucky to have such good owners and team structure around me, which makes doing my job easier.”

Stephanie Macfarlane and Robert Holt are farm managers for Andy and Tricia Macfarlane on Hepburns Road, where they milk 800 cows.

Production for the season is 338,000kgMS, with farm effective hectares 213.

They enjoyed entering the contest last year and are back again. “We learned how to analyse ourselves.”

They said the contest also provided great networking opportunities.

our business is heading in the right direction as this is our first season contact milking.”

Kenneth and Catherine Pottinger, and their three children, live on Fords Road, where they are contract milkers for Synlait. The 625-cow farm produces 245,000kgMS, on 169 hectares.

It is the second time they have entered the awards, and say they look forward to networking, pushing their business forward in a progressive manner, and the challenge of the contest.

Farm managers Jason and Paula Strawbridge work for the Spectrum group on a 1475-cow farm on Timaru Track Road. They have four children.

The herd produces 660,000kgMS from 385 hectares.

They say they want to progress in the industry, and to network with likeminded people.

Trainee of the year finalists: Stephanie Macfarlane and Robert Holt Athol New and partner Jane Campbell work for Synlait Farms, running a 1150-cow farm at Rakaia.

On 205 hectares, the herd produced 460,000kgMS. New to the Dairy Industry Awards environment, they decided to enter and get some feedback about how their business was going.

“We also wanted to judge ourselves against our peers.”

Mick O’Connor is a contract milker for Dairy Holdings. He and partner Kirsten Wyatt live on Heslerton Road, at Rakaia, where their farm milks 840 cows on 255 hectares.

Production for the season is 310,000kgMS. They decided to enter the contest this year, so they could get some advice from “the best in the industry” as well as setting a challenge for themselves. “We want to make sure

Lisa Avery is second-in-charge at a 450-cow farm owned by Cole and Virginia Groves at Oxford. She has entered the competition again to help her profile for future jobs. She said it was a good chance to compare herself with other trainees, network and meet top farmers.

Kirstie Austin Kirstie Austin works for Eric and Georgie Webb as a herd manager on their 800-cow Temuka dairy farm.

She said her bosses had encouraged

Meridian is proud to be part of the New Zealand Dairy Industry Awards family We’d like to congratulate Rob and Debbie Mackle on winning the 2011 Meridian Energy Farm Environment Award.

Seeing our customers do well makes our job all the more worthwhile.

We’re wishing all entrants in the 2012 New Zealand Dairy Industry Awards the best of luck. Let us know if we can do anything to help with your entry. If you’re not involved with the Awards this year but would like to see how Meridian can help you on your farm, give the Meridian is p d to be a prou Meridian Agribusiness Team ma r sponsor majo a call on 0800 496 444. of NZDIA NZDIA A

meridian.co.nz/forfarm

her to enter again. “And I wanted to give another crack at it this year for selfdevelopment.”

She said it was a chance to see where she stood and what she could improve on in the industry.

areas where ne needed to broaden his knowledge.

It was also a chance to put what he had learned for the year together.

Joshua Grant

Nathan Christian – a great opportunity to mix with future leaders.

Nathan Christian is a farm assistant on an 800-cow farm at Westerfield, in Mid Canterbury. He works for Ben and Shannon Johnson.

He said he loved the networking opportunities the contest created, and learning how he could push himself.

“I am entering again as I see it as a great opportunity to mix with the future leaders of the industry.”

Joshua Grant works for Lincoln University as a dairy assistant on its 630cow farm. He said he was entering the contest again to test himself and identify

Nicholas Rogers

Patrick Whittle

Nicholas Rogers is second-in-charge on a 200-cow dairy farm at Rangitata, under the supervision of Rob Wilson and Rangitata Dairies. He says potential career development was a big motivator in entering.

Patrick Whittle works for Duncan Rutherford at Waiau, where he is second-incharge milking 1200 cows. He is new to the contest, and says it is good practice for interviewing and getting involved. He hopes the experience will win him recognition within the industry.

He said it was also good to be involved in a dairy farming activity outside the farm gate.

10

Dairy Industry Award winners Winners have ambitious growth plans

T

he winners of the 2012 Auckland Hauraki Sharemilker/Equity Farmer of the Year, Scott and Alicia Paterson, plan to grow their

equity by 20 per cent each year.

The Patersons are in their first season 50 per cent sharemilking 630 cows for Stuart and Kaaren Davey at Paeroa.

It was the third time they had entered the awards, placing second in 2010 when they were lower-order sharemilking for the Daveys. â&#x20AC;&#x153;Our future farming goals are to achieve 20 per cent growth in equity yearly, to secure an additional 50:50 position or lease job nearby within three years, to assist and develop the next generation of dairy farmers and to achieve farm ownership through a large scale equity partnership.â&#x20AC;?

The couple says entering the awards gives them valuable, constructive feedback from well-respected professionals, and provides opportunities to improve growth and efficiencies in their business. â&#x20AC;&#x153;It also forces you to constantly evaluate how you execute your business and means you are regularly refining your systems.â&#x20AC;?

The winners of the 2012 Auckland Hauraki Sharemilker/Equity Farmer of the Year, Scott and Alicia Paterson.

The couple, who entered the dairy industry as part of a Taranaki rugbyplaying arrangement for Scott, say their strengths are in planning and monitoring and human resources.

PROUD NATIONAL SPONSORS OF THE NEW ZEALAND DAIRY INDUSTRY AWARDS

Paul and Amy Koppens â&#x20AC;&#x201C; contract milking 240 cows.

C

areer changers, Paul and Amy Koppens, walked away with the Northland Farm Manager of the Year title.

The Koppens are contract milking 240 cows for Bryce and Glenys Laing at Pukekohe and plan to continue to progress in the industry through to large herd sharemilking.

Paul Koppens spent 11 years drainlaying and another five years running drystock on leased land while Amy Koppens previously worked as a commercial property manager and only recently gave up her own wedding planning business. â&#x20AC;&#x153;Dairy farming for us is a lifestyle, one which our whole family loves and enjoys.

We hope to have a long career in this great industry.â&#x20AC;? The couple says farm and money management are two of their strengths. â&#x20AC;&#x153;Having the right education and qualifications, including great employers and mentors, has led to good skills and good farm management.â&#x20AC;?

T

he regionâ&#x20AC;&#x2122;s Dairy Trainee of the Year, Kylie Dunlop, is a farm assistant on a 600-cow Mercer farm owned by Matthew Dean. It is her fourth year in the industry. â&#x20AC;&#x153;I did a few different jobs before I started dairy farming. I was assistant manager at Burger Fuel in Parnell for four years and before that I ran the preparation kitchen for two years that made all of Burger Fuels secret sauces. It was a great job, but my husband and I decided we needed a change of lifestyle and moved to the country. He tried dairy farming, but didnâ&#x20AC;&#x2122;t like it. I love it!â&#x20AC;?

Ms Dunlop, who has just married her long term partner Philip Grigg, says her goal is farm ownership and she plans to take the traditional pathway through managing and sharemilking to achieve it. â&#x20AC;&#x153;I think thatâ&#x20AC;&#x2122;s the best way to move your way up when you are not born into Kylie Dunlop â&#x20AC;&#x201C; farm assistant the family farm.â&#x20AC;? on a 600-cow Mercer farm.

At Ecolab we are proud to be part of New Zealandâ&#x20AC;&#x2122;s dairy industry and we are proud to support the New Zealand Dairy Industry Awards. We believe in helping farmers succeed and further their careers in the industry and we look forward to a strong working partnership now and in the future. )RU LQGHSHQGHQW TXDOLoHG DQG IUHH DGYLFH RQ DOO \RXU IDUPLQJ VDQLWDWLRQ DQG PLON quality requirements please call your Ecolab Territory Manager 0508 737 343.

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11

Held to ransom Ray Mayne ne d Ray Mayne Hose and Fittings Limited

B

eing held to ransom is possibly one way of explaining it. I am referring to the Port of Auckland debacle and the Maritime Union of New Zealand standoff. At long last the port company has done what it had to do – sack the lot of them!

Our irrigation suppliers in the United States, Reinke Manufacturing, sent me an email late February. That email was from a number of freight forwarders based in the US. Most of these forwarders were in the process of diverting ships away from the Port of Auckland to Tauranga.

They also changed the port rotation to fall outside the strike periods and “took other measures to maintain the integrity of the supply chain for our customers exporting to Auckland”.

The email continues: “We are now seeing negative flow-on effects to other ports such as Tauranga which is operating at full capacity.”

The punch line of the email is “regrettably we have to pass on a portion of the strike related expenses. As of 1st April 2012 all cargo destined to New Zealand will be subject to a strike surcharge of USD 220 per 40’ container” (NZ $270.00) Not a lot of money – one would think, however when one considers the numbers of containers that are in New Zealand at any time - the extra cost is huge!

All this because watersiders are up to their old tricks again.

Some facts: The average pay for full-time stevedores at the port is $ 91,000.00 per year. Superannuation contributions and medical insurance make

Ports of Auckland workers striking against their work being contracted out. up $ 2055.00 of that amount. Permanent employees receive five weeks paid leave and are entitled to 15 days sick leave each year. However, once again there is a punch line – for every 40 hours paid only 26 hours are worked!

These figures have been provided by leading accountancy firm, Ernst and Young, so I guess the figures can be believed!

According to reports Ports of Auckland put an offer of a 10 per cent wage increase, bonuses of up to 20 per cent for improved productivity and rosters planned a month in advance to the Maritime Union of New Zealand. Unfortunately, apparently, that offer was turned down by the Union! It is, and was, appropriate, I believe, that the lot be sacked.

Since the 330 workers have been sacked, Drake New Zealand and AWF Group have signed contracts to

introduce “competitive stevedoring at the container terminals”. At long last sense has prevailed and hopefully, now, things will get back to normal as quickly as possible.

All of the containers we receive from Reinke Manufacturing in the US have come through Port of Auckland. We haven’t really had too many issues with the system in place up until now, although we have had some minor issues in the last few weeks with delayed shipments etc., and as of the 1st April an extra cost will be incurred as the freight forwarders are trying to bypass Port of Auckland and go straight to Tauranga.

Why we can be “held to ransom” by a small, but militant group, like this, is unbelievable. I would imagine some of our major exporters – like Fonterra for example, will be very mindful of exactly where their containers are being despatched from!

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12

Dairy conversion Linda Clarke ke Rural Reporter, Ashburton Guardian n

Laying down the gravel base for concrete pads.

Swamp Road cropping farmer Alex Mowat is converting his land into a dairy farm.

H

inds cropping farmer Alex Mowat is converting his 170ha home block on Swamp Road into a modern dairy farm where he will milk 700 cows from next season onwards. He said good planning and allowing plenty of time for the conversion

were crucial to keeping stress levels down. However, the project is an exciting one for the Mowat family, who are watching every day as the cowshed takes shape.

Alex said they were prompted to convert by the positive encouragement of a neighbour. Having more control over their farming business and the financial security of regular milk cheques were also factors.

While career converters would have taken less time, the conversion was a 12-month process for the Mowats. In June last year, he and wife Pip started investigating the conversion concept and drawing up budgets. “I wanted to have a decision made by the end of August, but it didn’t quite go that way.”

The decision process was longer than anticipated.

The couple pitched their conversion plans to three different financial institutions, each bank looking at the scenario quite differently. Mortgage secure, Alex and Pip visited plenty of working dairy sheds, including automatic milkers, before settling for a 54-bale rotary. As well as a milking shed, the farm also needed accommodation for a farm manager, pasture regrassing and new fences. Lateral irrigation developed on the dryland farm several years earlier would continue to be put to good use.

Contractors work on the area surrounding the shed’s concrete pit.

After finding a farm manager who would help him through a steep learning curve, Alex then signed up

13

Dairy conversion Linda Clarke ke Rural Reporter, Ashburton Guardian n

a team of experts to undertake the physical work Eventually, after a Christmas break treading water, construction finally began on January 11. Alex said he hoped the shed would be complete by mid-June. His mixed-age herd, sourced from Feilding and Reefton, will arrive, pregnant, on the farm at the end of this milking season. It had been an intense exercise, both stressful and exciting, he said.

He has managed the project himself, being on site most mornings to make decisions. â&#x20AC;&#x153;Communication is a big part of what we are doing.â&#x20AC;? He said he was not sad to be selling his combine harvester. â&#x20AC;&#x153;We have just finished what is my 32nd harvest. I think it is fair to say I am just over it.â&#x20AC;?

Budgeting and succession planning was clearer.

Alex said while the dairy shed had plenty of mod-cons, like automatic drafting and cup removal, he had some experience as a youngster to call upon. â&#x20AC;&#x153;I had an uncle with a town milk supply and we used to work on his dairy farm in the holidays when we were kids. We have employed a manager who will work alongside me and I think it will be a good learning curve.â&#x20AC;?

Researching the conversion, Alex said fellow dairy farmers had been happy to show him their systems.

He still gets a bit of stick from arable colleagues for converting. â&#x20AC;&#x153;I was one of those people a few years ago.

New pasture pushing through after having been direct drilled.

I didnâ&#x20AC;&#x2122;t want to be a dairy farmer, but at the end of the day it is sheer economics.â&#x20AC;?

Minding the environment remains an important part of the conversion process. Alex spent a fair bit of time researching effluent systems, and investigating effluent management in the UK, Scotland, Germany and Austria. He plans to inject treated effluent into his main irrigation lines and distribute it back on to pasture via the laterals. â&#x20AC;&#x153;I am reasonably confident with the whole effluent management. Every farm is different and every situation is different.â&#x20AC;?

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Starting with a clean site, once a wheat paddock, gave him the opportunity to use the best technology and design at the time.

Another aspect of the conversion was deciding on a milk processor. â&#x20AC;&#x153;We have gone with Fonterra. We seriously investigated Westland and Synlait; they all have something to offer.â&#x20AC;?

Ultimately, it was a decision the Mowats made with their professional advisors â&#x20AC;&#x201C; including accountants and farm advisors.

100907C4595

The Mowats will lease a run-off block next door to the dairy farm and grow greenfeed for their dairy cows. Theirs is one of two dairy conversions on Swamp Road, the first dairy farms on the road. â&#x20AC;&#x153;It is all go, and we are generally looking forward to it. We feel like we are in charge of our own destiny. In arable, you get what you are given; the dairy industry has a lot more structure.â&#x20AC;?

14

Dairy conversion Linda Clarke ke Rural Reporter, Ashburton Guardian n

T

here’s still plenty of demand for land for dairy conversions in Mid Canterbury, says rural estate agent Paul Cunneen.

A 302ha block of prime arable land at Dorie sold last month after the vendors considered multiple offers.

This, and ongoing inquiries by potential purchasers, was evidence of the steady demand for land to convert to dairying, he said.

The Dorie sale price was confidential, but the purchasers have dairy farm interests and it is likely to eventually be converted.

Mr Cunneen said the steady demand for land came mostly from New Zealand purchasers, with farms in the Pendarves and Dorie area keenly sought after.

“It is a premium area, because you can do a variety of things, not just dairying.”

He said buyers included existing dairy farmers and equity investors, and all had done their homework on the land’s production potential.

Buying the land is the first step in plans that may have been brewing for 12 months or more. The building of cowsheds, grazing, lanes, fences and

irrigation – all governed by consents – and then buying a herd followed.

A new issue for farmers converting in

Armadale farm at Dorie fetched a record price in a recent sale. the last five years has been which milk company they will supply. Fonterra was once the only choice, but now Synlait and Westland are increasing their presence in the district.

Mr Cunneen said choosing a supplier was a decision influenced by a farmer’s finances and business philosophy. “They all have their own thinking on the matter.”

At least 20 new dairy farms are expected to be operational by the start of the 2012-13 season, with more on the drawing board. The number of dairy cows in New Zealand has more than doubled since 1974, with the national Paul Cunneen herd numbering 4.5 million cows in the 2010-11 season. The average kgMS per cows has grown from 259 in 1992 to 334 in the 2010-11 season.

&RQYHUWLQJ RU XSJUDGLQJ" 1HHG PRUH WLPH DQG OHVV VWUHVV" Let us take care of your dairy shed, housing, farm buildings and maintenance needs. Leaving you more time to organise everything else.

In Ashburton, the total number of herds was 308, with 202 owner-operators and 106 sharemilkers. The district’s herd totalled 260,801; the average size herd was 847. Average kgMS per herd totaled 322,694 and was the second highest (behind Hurunui) in the South Island.

One things is for sure, the dairying “wave” that began 30 years ago in the district is still rolling.

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15

Dairy conversion Linda Clarke ke Rural Reporter, Ashburton Guardian n

A

lvin Reid and his wife Judith bought their first dairy farm in 1981 in Temuka, South Canterbury.

A lot has changed since then – the Reids now have interests in six farms - three of their own and three with business partner, neighbour and friend Milne Horne and his wife Christine. It is a complex task to ensure water is used and managed efficiently across multiple farms with multiple consents and water sources.

Another noticeable change since the early days is Alvin’s gumboots are now, more often than not, found by the front doorstep. Much of Alvin’s time is now spent surrounded by computers, gadgets and wires in a small, but comfortable, room located within sight of his muddied boots.

Alvin says he wouldn’t have it any other way. “An efficient irrigation system is vital to any dairy operation,” he said. “The water take system on our Accord Dairies farms is particularly complicated with water coming from either ground or surface water abstraction or an irrigation scheme originating from the Opuha Dam. “Some consents have different conditions attached to them including daily and weekly volume restrictions making it difficult to manage the water-take at each pump and irrigator. Some individual water-take consents are also affected by what is taken at other sources and the permitted volume of take can alter as river levels change. “This meant we used to have to manually check meters at each pump and monitor how often irrigators could run and at what level,” he said.

and accurate system,” he said.

Complex information synchronised and simplified on South Canterbury farms

Alvin’s Acerna Pastures dairy operation is just as complicated. It has consent levels that allow for a maximum of six days per week pumping.

“We thought there must be an easier, more efficient and reliable way.”

To help simplify the process and ensure up-to-date and reliable water information use is readily available, Alvin and his business partner installed nine telemetry systems across the three properties.

Data is collected at every bore on the property and sent to a central point (along with data from around 40 other pump sites around Geraldine flat) before being transmitted to a firm in Timaru that uploads the information and graphs it on a website that can be viewed by Alvin and his team. A compliance report is also sent to Environment Canterbury.

“The telemetry system means we can maximise the efficiency we are getting from our water resource while ensuring we still operate within our consents.

We also get automatically notified if we breach our consent conditions so we can make the appropriate adjustments.

“The cost to install and run the system is acceptable when you consider the benefits we gain from it. I would definitely advise any farmer who has a consent to take water to install telemetry devices and begin enjoying the increased efficiency from an automated

“The complexity of our water take system meant we often had to turn irrigators off well before they reached their consent limit to reduce the risk of a breach. By automating the process we ensure we are getting the most from what we are entitled to use.

“Telemetry has been an essential tool on this property in order to maximise the water use on that consent without becoming non compliant.”

Alvin admits he is particularly adept in dealing with technology and relishes the opportunity to utilise new devices and technologies but he is quick to add that other farmers who aren’t as savvy as him should not be put off by the technology.

“The automated water measuring systems have revolutionised the way we do business,” he says.

“It would be very difficult to manage resources across this many farms without the precision, accuracy and ease offered by the telemetered devices.

“Our farm managers all rely on the information that is provided and if there is an issue they are sent a text or email so it can be rectified very quickly. Everything can be checked from the comfort of the computer chair removing the need for time consuming trips to check manual devices.”

In all, there are 16 water measuring devices installed on the farms Alvin Reid is involved with and the majority of these have telemetry features.

TIME IS RUNNING OUT to ensure you comply with your water take consent

2012

Failure to do so could cost you money and impact on production If you have a water consent to take 20 litres a second or more you need to install a water measuring device by 10 November 2012.

Deadlines

Take size

10 November 2012

20 litres/second or more

10 November 2014

between 10 and 20 litres/second

10 November 2016

between 5 and 10 litres/second

More than half of Ashburton zone water consent holders have yet to install a water metering system Ashburton water metering installation rates* Groundwater takes

52%

48% Installed

For more information contact: Environment Canterbury Water Metering Team, 4 McNally St, Ashburton Phone 03 308-7682 or visit www.ecan.govt.nz/watermetering * As at 12 March 2012

Brought to you by Environment Canterbury working with NEW ZEALAND I N C

Surface water takes

82%

18% Installed

16

Dairy conversion Linda Clarke ke n Rural Reporter, Ashburton Guardian

D

onald Sutton fields the first inquiry from dairy farmers wanting Calder Stewart to build a new milking shed for them.

He says some farmers have done a lot of homework and know exactly what they want; others need to walk through a few sheds.

There are many variations – rotary, herringbone and automatic milkers; sheds with rectangular or circular hard stand areas.

One issue to be sorted early in the construction phase is what type of platform and milking plant will be installed. Platforms now come in concrete and the new plastic composDonald Sutton ite, while two of the major milking systems are Milfos and Waikato. Both are installed by specialists.

Mr Sutton said if the circular pit and roof were constructed first, builders could work around platform and milking system installers while they laid the concrete around the platform. He said getting the fall of the concrete yard was important so effluent could be washed off.

Inside the sheds are few novelties. Most are white,

The shed’s concrete pit is constructed first. but colour panels inside and out are an option. It’s not that the cows mind, but people spending many hours in the sheds are entitled to an enjoyable work space.

“If you compare the sheds now to 20 years ago, the shed owner is becoming more aware of actually creating a better environment to work in. People can spend six hours a day in the shed. It is a long time to be standing, so things like a warm, light and bright environment are important.”

Calder Stewart likes to give more room between the platform and the outside walls to create space.

Some sheds are sited so people working in them have views of the Alps; location is important in reducing the distance cows have to walk to be milked, and how effluent will be treated.

In ideal conditions, a crew of three or four could complete a shed build in about three and a half months.

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17

Dairy conversion Ian Hodge, BVSc. MACVSc. c.

Riverside Veterinary Services Ltd d

A veterinary perspective

In the South Island we see diseases which commonly are associated with new conversions. Rumen diseases like acidosis are common because of a lack of effective fibre from new pastures.

T

here is no doubt that there is a great deal at stake when beginning a new dairy farming enterprise.

Protein levels can be high in new pastures which can have an effect on the energy status of cows. Trace mineral deficiencies are often seen. Selenium deficiency, for example, can result in a number of significant health issues for dairy cows.

Considerable financial investment is required just to get to the point of milking the first cow. In our experience good planning, management and decision making is paramount. This includes the purchase of your herd.

Your cow shed also represents a significant investment. We strongly recommend using reputable companies, and having a milking machine and milking management assessment done after you have started milking.

Your cows are your asset. They will be providing a daily income for many years to come. Buying the right cows is very important. Cheaper is not often better when it comes to cows.

Accurate pregnancy testing to age all foetuses, accompanied by accurate records of this pregnancy testing is critical.

The health status of cows should be known and disclosed to you and should include written evidence.

Cows should be vaccinated against diseases such as leptospirosis and possibly bovine viral diarrhoea virus, both of which can result in reproductive failure.

The individual somatic cell count of the cows should be known; otherwise you may well purchase cows with high levels of sub clinical mastitis which will be almost impossible to cure once they start lactating.

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We have had many examples of herds that have been purchased with unknown calving dates based on inaccurate pregnancy testing and this makes herd management in your first season very difficult.

Planning for a compact calving pattern that will comply with the induction code means buying cows with known calving dates that are within an eight week period of your planned start of calving.

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Planning for a compact calving pattern that will comply with the induction code means buying cows with known calving dates that are within an eight week period of your planned start of calving. Many cows sourced in the North Island will have earlier calving dates.

Your staff are critical to your survival in the dairy industry. They should be given every opportunity to learn. People respond favorably to positive reinforcement, being given opportunities to learn and being treated with respect. On-farm training for staff is highly recommended.

Finally we recommend aligning yourself with one primary veterinarian who can assist you through the planning and implementation of a new dairy farm.

Your vet will be able to ensure the new herd is healthy, and arrives with accurate calving dates and the appropriate vaccination status.

Your vet will also be able to see that your first season goes well, your cows and heifers have good reproductive performance and your mastitis risk is minimised.

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18

Dairy conversion Fred Hoekstra ra Veehof Dairy Services es

Poor tracks at fault?

That leaves about three hours or so for the farmer to get the cows out of the paddock, milk them and back into the paddock again - twice a day. Many farmers donâ&#x20AC;&#x2122;t manage that, therefore the cows become very lethargic and that is particularly evident from now when cows are increasingly slower in getting to and from the paddock.

T

he Field Day season is in full swing again. We have been in Waimumu and are about to go to Feilding and soon it will be time for the Hamilton Field Days again.

At the Field Days I sometimes get into interesting discussions with farmers about lame cows. Every time I notice that physical damage is seen as the major cause of lameness. It seems so ingrained in peopleâ&#x20AC;&#x2122;s minds that it is hard to change their thinking.

Often that thinking is based on what other people say, or on what we believe is logic. Tracks (or races), for example, are blamed for the so-called stone bruising. Somehow, it seems logical that rough tracks with more stones cause more bruising because there is more chance for a cow to stand on a stone.

When we spend a lot of money on our tracks we seem to get less lameness so, therefore, the stones must be the cause.

If we work 16 hours a day every day at some point it is likely that we will burn out.

Improved tracks mean improved cow flow, and improved cow flow means more time to eat and rest in the paddock, which is likely to reduce lameness.

I think that there are other possible explanations that, to me, make more sense. I donâ&#x20AC;&#x2122;t see any evidence of bruising caused by stones. If the bruising was caused by the stones then I would expect more bruising and damage on the inner (more vulnerable) claw than on the outer claw which has a thicker sole.

So, what then can be another explanation as to why poor tracks seem to have such an impact on our cows that makes more sense? I believe that time budget has a lot to do with it. Cows need 12 hours a day for resting and eight hours a day for eating. They also need some time for drinking and socialising.

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The thing is that every cow in New Zealand has got laminitis to some degree. So, they have unhealthy feet.

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I believe that that is what is happening with our cows. Improving the tracks does seem to improve cow flow, just like people generally walk easier/faster over tar seal roads than gravel ones.

Improved cow flow will result in more eating and resting time for the cows in the paddock â&#x20AC;&#x201C; a factor which is much more likely to reduce lameness than the perceived extra physical force that poor tracks put on cows feet in and of

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19

Dairy conversion Linda Clarke ke Rural Reporter, Ashburton Guardian n

D

onâ&#x20AC;&#x2122;t panic if you need stock for your new conversion, says PGG Wrightson livestock agent Victor Schikker.

There will still be quality stock at the end of the season, he says, but do your homework and go with your agent to view the most likely herd buys.

Mr Schikker said some dairy farmers in the last two conversion booms had panicked and bought cows early, at high prices.

Conversions hoping to be operational by the start of the next milking season on August 1 will be under way at the moment while plans for conversions in the next season will be being born, or rehashed and fine-tuned.

Mr Schikker said some farmers converting will have already bought heifer calves, and will be waiting for other herds to move at the end of the milking season.

Eighty per cent of herds for Mid Canterbury conversions are sourced from the North Island.

Before buying stock it pays off to do your homework and scrutinise herd performance on paper.

and whistlesâ&#x20AC;? - automatic cup removers, electronic identification readers, computer systems which measure and monitor individual cow production and track sick cows. â&#x20AC;&#x153;Instead of building basic sheds and putting the bells in later, they put them in at the start. It He urges farmers to do their homework, and take means fewer people in the shed, with only one person care when buying, cows are a lifetime investment. He said many farmers and agents scrutinised herd perfor- putting cups on.â&#x20AC;? mance on paper prior to inspection. Doing the homeHe said dairy cows grazing grass would remain work paid off and meant potential purchases could be the dominant form of the industry in Mid Canterbury, whittled down to a couple of groups worth personal despite one conversion under way locally where cows inspection. will be kept undercover. â&#x20AC;&#x153;That one conversion happening in the district at the moment is being watched Research should not be confined to stock, he said. with interest. But there is a high cost to it.

Think about shed design and layout. Visit dairy farmers with new sheds. Mr Schikker said new rotary â&#x20AC;&#x153;In Mid Canterbury the ground does not get wet, sheds were most popular, and fitted with â&#x20AC;&#x153;all the bells

does not pug, and weather conditions are favourable.â&#x20AC;?

He said dairy farming had come a long way over the past decades and there were high-tech versions of the simple â&#x20AC;&#x153;feed and milk twice a dayâ&#x20AC;? routine, using computer software to monitor and improve herd performance. But basic stockmanship was still important, and there was no substitute for gut-feeling and the â&#x20AC;&#x153;eye-cromoterâ&#x20AC;? (casting your own eyes over the herd).

What sorts out the top farmers? Mr Schikker says the best dairy farmers stand out because they feed well, keep good records and have good breeding programmes. â&#x20AC;&#x153;They do everything well, not just one thing.

It is about extra attention to detail and being a good all-rounder.â&#x20AC;?

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20

Dairy conversion A

round 550 people attended the inaugural Canterbury Dairy Effluent Expo last month, which has industry players excited.

“We are very encouraged by the number of people who attended the expo and the high level of engagement around finding out good practice for current dairy farming issues,” said dairy farmer and Environment Canterbury Commissioner Tom Lambie.

good-practice information on dairy effluent under one roof, on one day,” he said.

Lucy Bowker, environmental manager for Synlait, said the expo was well received by farmers and provided quality advice following interest generated by the establishment of the Farm Dairy Effluent Design Code of Practice and Standards.

“The expo gave farmers a chance to talk to effluent system suppliers to find out how a system can be designed to follow the code, so it is ‘fit for purpose’ and caters specifically to their farming operation.

The expo was hosted by the Canterbury Dairy Effluent Group – a dairy industry-council initiative set up in 2008 – to promote Tom Lambie environmental compliance and the “The timing of the event would optimal use of dairy effluent on farms. The people help farmers to cost out their requirements in plenty who attended the expo were a mix of farm owners, of time to set budgets for any upgrades.” sharemilkers and farm staff, as well as people working in agribusiness goods and services firms.

Environment Canterbury director of resource management Kim Drummond said the new regulatory re“The willingness of suppliers and industry to work quirements within the Canterbury Natural Resources together to deliver compliant, practical, and economi- Regional Plan also made the expo very timely as dairy cal solutions on-farm was evident in the number of farmers work to address a number of issues. exhibitors supporting this free-to-farmer expo,” Mr Lambie said.

“These issues include new dairy effluent pond requirements, additional stock exclusion rules from More than 40 organisations and companies set up Environment Canterbury which take effect in June, as displays at the expo and were rewarded with a steady well as the national water metering regulations which stream of people to talk to throughout the day. come into force in November this year,” Mr Drummond said.

“It is not often that dairy farmers have the opportunity to compare such a variety of commercial and Westland Milk Products chief executive Rod

Quin says the event attracted farmers from as far as the West Coast who were looking to increase their knowledge of improved effluent and environmental practices.

“As well as showcasing new and applied dairy effluent methods, the expo offered a valuable opportunity for dairy farmers to network, and discuss tried and true effluent management options,” Mr Quin said.

Libby Sutherland, Sustainability Team for Fonterra, said it was great to see the number of Fonterra suppliers that made the event, and all were boasting fantastic feedback.

Alastair Wiffen, who attended the expo representing Opus International Consultants, said the event was effective as it was specific to dairy effluent and all stakeholders had a common purpose.

The Canterbury Dairy Effluent Group was formed to help improve on-farm environmental compliance and optimal use of dairy effluent.

Recognising farmers, their industry representatives and environmental regulators all had similar goals of good environmental stewardship, the parties have worked together on the focus and use of consistent messages to help farmers improve awareness regarding effluent management.

The Group includes DairyNZ, Environment Canterbury, AgITO, Federated Farmers, SIDDC, Fonterra, NZ Dairies, Synlait and Westland Milk Products. It was established in 2008 to work collaboratively towards improving dairy industry environmental performance through a range of measures.

21

Tough top for silage W

ith bumper crops of maize silage around this year the only downside is the task of throwing old tyres on to the stack, and keeping pukekos out. The tyre job is possibly the least popular of any on the farm, and pukekos the least popular bird given the damage they can do to valuable silage stacks.

Craig Lipscombe, owner of South Auckland covered feed-pad system company Dairy Diner, is now importing a silage cover promising to eliminate the need for tyres. It also ensures feed quality is locked in, and makes stack management easier. Secure Cover Silage Covers are a common feature in the United Kingdom and North American farming landscape and Lipscombe believes they will attract strong interest here.

The polyethylene UV resistant netting is placed over standard polythene sheet, and can be held down along any seams and edges using bags made of the same material and filled with pea metal. The dense, strong nature of the knitted cover places it close to the polythene’s surface, reducing wind lift and minimising unwanted air intrusion to damage silage quality.

Lipscombe says he happened upon the covers after designing two silage bunkers for a farmer, and was having to allow extra room just for tyre storage. “I thought there must be a better way and started researching on line.

The Secure Covers had a proven record in the United Kingdom and North America and were exactly what we needed.”

Sourced from the United Kingdom company Thomas and Fontaine, the covers have established a reputation for their ability to withstand Force 7 storm conditions on the Orkney Islands through winter in over 150kph winds. Here in New Zealand high UV levels as well as wind can reduce longevity of plastic based products, and farmers will welcome the seven year UV stability guarantee.

While Force 7 conditions may be less common here Lipscombe says pukeko damage is one peculiarly New Zealand problem the covers protect valuable maize and grass silage from.

“One of the first covers we supplied

A cover tough enough to keep pesky pukekos out – as well as Force 7 storms. was for a farmer who had his whole stack devastated by pukekos picking holes in the plastic. The dense, tough polyethylene on the Secure Covers is impossible for pukekos and pests to penetrate, keeping them and the air out.”

Opotiki farmer Ian Brown has had the covers for over seven years, protecting over 1 million tonnes of dry matter held as maize or grass silage every season on the 1500 cow operation.

“The beauty of it is that you can walk on the stack when sealing it up and not worry about putting a hole in the plastic, it is far tougher than the polythene you lay underneath it. Stock could walk over it and it would not be damaged.”

Some farmers may prefer to continue using the tyres they have accumulated over the years, and the tough nature of the cover means tyres can be thrown onto the stack without fear of ripping a hole in it.

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pea metal and tied off with supplied cable ties. The bags are a particularly appealing alternative to concrete posts for holding down stack sides, and unlike tyres can be easily stored on a pallet when not used.

A cover and gravel bags for a typical 12m by 30m silage stack costs around $1800. “The beauty is it will also mean you can use the polythene below again, and you will get the job covering it done quicker, and without messy tyres.”

22

A woman ahead of her time O

live Castle was a mathematician who joined the New Zealand Dairy Board in the 1940s. She worked largely behind the scenes but her work enabled a scheme which has generated billions of dollars to the New Zealand dairy industry and the country’s economy.

Her contribution is recorded in a book launched last week by dairy farmer cooperative, LIC.

Ms Bayly said The Billion Dollar Scheme is dedicated to five very special people who devoted their lives to improving the profitability and sustainability of dairy farming and whose work enabled the LIC Sire Proving Scheme. Those people are Olive Castle, Sir Arthur Ward OBE, Dr Patrick Shannon QSO, Jeff Stichbury and Harvey Tempero.

An extract from the book

Author of The Billion Dollar Scheme and LIC communications manager Clare Bayly said that acknowledging Olive’s contribution was a very important component of the book. “We had to make this happen. Olive was a ‘creature of the times’, a woman working in a male environment, a conceptual thinker who worked behind the scenes and solved a dilemma which enabled dairy sires to be accurately evaluated.

– Olive Castle

“Colleagues recall that she never sought the limelight, however, and, whereas today, she would seek to have her work published, in those days she ‘just got on’ with the next task at hand. It therefore became important, when putting this book together, to ensure that her contribution was acknowledged, to avoid it fading into the mists of time.”

On Arthur Ward’s appointment as director of herd improvement in 1945, she became responsible for research. She and her assistant, Patrick Shannon, who joined the staff in 1954 and who became responsible for research when Olive retired in 1970, played a major part in bringing about the considerable number of world firsts that were established under the Herd Improvement Plan. The plan

I

n 1939, Olive Castle obtained a Master of Arts Degree with Honours in Mathematics from Victoria University. She worked as a mathematics teacher before accepting an invitation in 1939, from Arthur Ward, to join him as the New Zealand Dairy Board began to deliver the vision contained in the Herd Improvement Plan.

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The success of these measures was dependent on the data collected and the development of procedures for using that data.

The New Zealand Society of Animal Production (NZSAP), in its nomination of Olive for Lifetime Membership, records that it was fortuitous that she was in the driving seat charged with delivering many of the initiatives contained within the Herd Improvement Plan.

The nomination acknowledges that Olive’s “achievements in this field have rarely been documented in scientific literature, mainly because she was always too busy starting work on the next problem to take time out to write up the previous one.

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“Evidence of her ability is not hard to find, though, in the development of New Zealand’s herd testing systems, the successful progeny testing method developed by her from AH Ward’s original work, the extensive documentation of the many facets of the New Zealand dairy industry, and the success of the Dairy Board’s artificial breeding service.”

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was to use data collected by and from the industry itself to improve the efficiency of dairying and the standard of living of New Zealand dairy farmers. This was achieved in a number of ways including the development of progeny testing systems and other measurements of the genetic merit of dairy cattle, the establishment of an artificial breeding service and the collection of data from dairy farms to examine herd and farm management practices.

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A very rare photograph of Olive Castle - extracted from a group photograph taken in the 1940s. evaluated in the 1940s. Known as the daughter dam comparison, a bull’s daughters were compared with its mother.

However, this did not provide enough data and Olive suggested that a more reliable method would be achieved by comparing a bull’s daughters in the herd with the average of all other animals in that herd milked in the same season.

In effect this meant that all daughters of the sire could be used in the proof, removing one of the major biases of the daughter dam comparison. Olive’s model, known as contemporary comparison, also meant bulls could be tested across herds.

The New Zealand Dairy Board duly accepted Olive’s solution and, over time, contemporary comparison became the norm for progeny test programmes across the world.

Olive Castle died in 1988.

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23

Maintenance fertiliser important T

he favourable summer growth conditions in many parts of the country have set farmers up well for excellent summer and autumn production.

However, some farmers are facing the issue of a surplus of pasture, and there are reports of some farmers electing to withhold their normal maintenance fertiliser inputs for fear of making this feed surplus worse.

Ballance science extension manager Aaron Stafford says that farmers need to remind themselves of the reason they are applying maintenance fertiliser in the first place.

“Maintenance fertiliser is applied to maintain good levels of soil fertility – that is, at a level where pasture growth is not limited by nutrient availability. So, applying maintenance fertiliser will not generate a larger feed surplus. Conversely, choosing to withhold this fertiliser could have implications on pasture production over the longer-term, since soil fertility levels will be gradually mined.

“Farmers should consider their needs for phosphate, potassium, sulphur and magnesium to replace the nutrients lost from the soil each year in production. This is what maintenance fertiliser application is required for - not to boost pasture growth.”

Mr Stafford says that farmers need to know what is in the fertiliser mix they are applying. If there is a surplus of feed already evident, the one nutrient they do not want to apply is nitrogen, which should not be part of the maintenance fertiliser mix in this case.

“Farmers are well aware that more nitrogen applied now will just increase the surplus of feed unnecessarily. Our focus with maintenance fertiliser is about maintaining soil nutrition for the future rather than generating a boost to pasture growth now.”

He says that if additional supplements have been cut this summer farmers will need to remember that this also means more nutrient removal, and hay or silage paddocks

Maintenance fertiliser is about maintaining soil nutrition for the future. may need fertilising over and above maintenance levels to replenish the land.

“Another consideration this season is the ability to get nutrients on when you require them. Unnecessarily deferring application of maintenance fertiliser potentially creates issues through generating a large backlog of work for spreaders, further delaying the application of nutrients beyond the critical autumn period.”

DDC is offering services of trenchless excavation by way of directional drilling or thrusting for all those places you don’t want to open trench, therefore saving on mess and reinstatement costs.

Mr Stafford says that while many New Zealand farmers are in the enviable position of lush pastures at the end of summer, farmers in some areas may now be in a position where it is appropriate to apply some nitrogen.

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24

Who you know is what counts I

n a recent marketing campaign Synlait Milk asked its existing milk suppliers for the names of farmers they had spoken to recently about the company, as part of a good old fashioned introduction.

Those named were then contacted for a chat about the great benefits of becoming a Synlait milk supplier.

Suppliers who provided names were entered into a draw to win a holiday for two in Fiji, valued at $3000.

“We recognise the significance of a personal endorsement, and that’s why we asked our current suppliers to give us one,” says David Williams, Milk Supply Manager at Synlait Milk. “The response from farmers was great. It just goes to show how much our suppliers appreciate being involved in the success of the business. It’s been one way we’ve been able to say thank you to our suppliers for their continued support and commitment. “Without innovative and loyal farmers like we have, we wouldn’t be the international company we have become today.”

Synlait milk suppliers rank alongside our customers as our most important business partners, and we are committed to ensuring that by working with us they are better off than by working with anyone else, Mr Williams said. “Our plans for growth include new customers in high-value markets around the world, innovatively meeting consumer demand for premium nutritional milk products, and maximising our manufacturing capability and export volumes.

“To make more from milk we need to ensure that global consumers are able to access the best that Canterbury dairying has to offer. Over the last four years we’ve signed up over 145 farms on long term supply agreements.”

Synlait’s new general manager supply chain Matthew Foster presents the prize of a trip for two to Fiji to Leon and Bronwyn McKavanagh from Dunsandel.

Synlait’s new general manager supply chain Matthew Foster presented the winning prize of a trip for two to Fiji to husband and wife Leon and Bronwyn McKavanagh from Dunsandel. The couple milk 1100 cows on their Dunsandel property and have been supplying Synlait since the company began operations in August 2008.

“We are delighted to have won the holiday to Fiji.

Bronwyn and I look forward to sunning ourselves on

a golden beach, especially after the summer we have had.”

“Synlait has been good to us over the years, and we would like to thank them for their commitment to us, and all of their suppliers.

“We fully support their strategy, and the approach to leave their suppliers better off than the alternatives,” Mr McKavanagh said.