Dairy News Australia - February 2018

Fonterra investigates Aussie co-op. PAGE 3 PASTURE

High yields defy low rainfall.

PAGE 32

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FEBRUARY, 2018 ISSUE 88 // www.dairynewsaustralia.com.au

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NEWS // 3

Fonterra investigates Australian co-op GEOFF ADAMS

FONTERRA IS investigating whether its Australian operation could become a co-operative, and will put information to its Australian suppliers in April.

Fonterra managing director, Rene Dedoncker said the issue has been raised by Australian farmers.

“By the end of March will have finished the first part of the work and in April will take the proposal to farmers, of new ownership models, including a co-operative.

“If farmers have an appetite for that, then we would go the next step,” Mr Dedoncker said.

Fonterra is a farmer owned co-operative in New Zealand but runs as a private company in Australia.

Asked how the New Zealand shareholders

Sharing the load. PG.11

would react, Mr Dedoncker said it was no secret and they were talking to New Zealand stakeholders about it.

“Farmer to farmer, they embrace the idea of more farmers having skin in the game in Australia.

“How it comes to fruition is the next piece of work that we need to look at, but they are positively disposed.”

Asked about pricing, Mr Dedoncker said they knew they needed to have a competitive farm gate milk price every day.

“Our milk price is $5.60/kg milk solids following a step-up prior to Christmas.

“In addition to the $5.60 there is the 40c milk payment, taking the total to $6.

“We are confident that price is sustainable in the season.”

Meanwhile the company will be looking for up to 200 million litres of milk to satisfy its

$165 million investment in factory expansions across Victoria.

About $125 million will be spent on the company’s Stanhope cheese factory, which it had only recently upgraded.

“We have a clear strategy that is delivering sustainable returns. To create value, we need to invest to stay ahead of the demand curve.

These investments support our aim to secure positive returns back to our farmers on both sides of the Tasman.”

“We are looking for the next 200 million litres of milk,” Mr Dedoncker said.

“We are seeing a boost in production, particularly in the north.

“We hope an extra 60 to 80 million litres will come from our own farmers.

“We do see the need for more farmers. We have a number interested in joining. It will be a mix.”

Breeding for heat tolerance. PG.20

GRUNT: On the scrap heap. PG.31

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4 // NEWS

Blue tongue outbreak creates China block ALANA CHRISTENSEN

CHINA CONTINUES to refuse to accept dairy

heifers from northern Victoria, despite local authorities declaring the region is free of the bluetongue virus.

Industry sources have confirmed that the export of cattle to China from the area around Echuca remains suspended because Chinese authorities are yet to formally acknowledge that the temporary BTV zone has been lifted.

Restrictions are in place for a small number of

countries, including China, that require animals to be sourced from a bluetongue-virus-free zone.

The decision is resulting in significant costs to the industry according to the Australian Livestock Exporters Council.

“Any supply chain disruption comes at a significant commercial cost to producers, agents and exporters and we are hopeful that any further disruption will be limited,” a spokesperson said.

“For this valuable trade to be successful, all stakeholders including producers, exporters and our importer customers must have full confi-

dence in our biosecurity and regulatory systems.”

Bluetongue is a viral disease of livestock spread to ruminants by flying insects known as midges.

While BTV is endemic in northern Australia, Victoria, along with the rest of southern Australia, has previously been classified as being free of BTV. Concerns were originally raised about the existence of the virus in October, when the past exposure to bluetongue virus was detected in several 12-month-old dairy heifers on a property near Bamawm.

Although a 100 km bluetongue virus zone was

put in place on October 13, it was lifted in midDecember after 2500 samples from 98 mobs of cattle were analysed.

A Department of Agriculture and Water Resources spokesperson said steps were being taken to resolve the situation.

“Australia continues to work closely with all importing countries, including China, to ensure importing country requirements are met for every commodity,” a spokesperson said.

“Negotiations are under way with China for live export of cattle located within the boundaries of the former bluetongue exclusion zone.”

Little new in “lightweight” Basin report A NEW consultants’ report may pave the way for the Murray-Darling Basin to get more water for the environment.

The report, commissioned by the Federal Government, says it is possible to get the 450 Gl of ‘upwater’ in addition to the agreed target of 2750 Gl without causing negative socio-economic damage.

And new Federal Water Minister David Littleproud has already said he wants to see the 450 Gl delivered.

The Ernst and Young report has been described as “disappointing” by Goulburn Valley water lead-

ers and joint chair of the Goulburn Murray Irrigation District Water Leadership Group David McKenzie.

Mr McKenzie said although it was a bulky document, there appeared to be little new analysis or insight that might help basin state ministers make sound decisions about how to design appropriate strategies and programs to complete the MurrayDarling Basin Plan.

Water leaders are worried that taking the extra 450 Gl from the consumptive pool will damage irrigation communities.

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Committee for Greater Shepparton chief executive officer Sam Birrell said the executive summary of the report stated there was evidence the 450 Gl could be recovered, subject to a number of “overarching risks”.

“This report is little more than a surface level assessment based on inaccurate data assumptions."

Suzanna Sheed, MP Shepparton “They have missed the biggest risk of all — that continued removal of water from the consumptive pool for irrigation makes some regions and industries unviable in seasons with lower water allocation,” Mr Birrell said.

The committee continues to be worried about the way the Murray-Darling Basin Authority addresses concerns from community leaders.

“The report identified an absence of trust in stakeholder engagement,” Mr Birrell said.

“This has manifested itself in the very nature of the Ernst and Young report consultation process.

“Our leaders who participated in these consultations have reported to us that the tone of the discussion was ‘how do we get the water’ not ‘can we get the water with no negative socio-economic impact’.”

State Member for Shepparton Suzanna Sheed

has described the Ernst and Young review as “a lightweight report” that raised more questions than it answered.

Ms Sheed said it did not provide the data needed for state water ministers to make informed decisions.

“This report is little more than a surface-level assessment based on inaccurate data assumptions,” Ms Sheed said.

“Not only have the potential water savings been inflated, the cost of on-farm efficiency measures and the market price of high-reliability water shares have been considerably underestimated and no costing has been provided for any of the proposed regional development initiatives for communities.”

Ms Sheed’s disappointment extended to the Goulburn-Murray Irrigation District — estimated to have negative outcomes arising from the basin plan — which was not considered “worthy of a case study with a targeted analysis of the impacts of future water removal” in the report.

“We have been telling anyone who will listen for some time now that the GMID is at a tipping point — it has been struggling under the strain of the basin plan and will not be able to withstand the removal of any further water,” Ms Sheed said.

“There has clearly been an overriding imperative in the preparation of this report to find the extra 450 Gl of water at all costs, effectively writing the GMID off as an unfortunate loser who could be placated with funding for non-related community and industry needs.

DAIRY NEWS AUSTRALIA FEBRUARY 2018

NEWS // 5

$125 m to double cheese production GEOFF ADAMS

CHEESE PRODUCTION at Stanhope’s Fon-

terra factory will almost double following the company’s decision to invest a further $125 million at the site.

The investment in the new cheese plant and aligned facilities will increase cheese production by a further 35, 000 tonnes for a range of cheeses including cheddar and mozzarella.

Stanhope currently produces 45 ,000 tonnes of product including cheddar, mozzarella, gouda, parmesan, pecorino, romano and ricotta.

Stanhope site manager Jason Wright said the plant, which officially reopened in August 2017 following a $140 million rebuild and expansion, was seen as an important asset in Fonterra Australia’s push to make the most of domestic and global demand opportunities for products like cheese.

“It’s important for dairy in Australia that we’re showing confidence and investing in expansion,” Mr Wright said.

“We believe in the long-term demand prospects for dairy, and especially for cheese given the growth we’ve seen in food service.”

The cheese investment follows on from a $1.3 million investment to support product innovation, as Stanhope rolls out its Perfect Italiano

Ricotta Stir Through for pasta and a further $6 million to secure efficiency gains.

“Ricotta is a staple product for us and our investments have enabled us to launch a first-ofits-kind innovation,” Mr Wright said.

“We’re confident the dollars spent in the plant will bring solid returns to farmers with these value-add, fit-for-purpose offers.”

Mr Wright said with the cheese expansion the site was keener than ever to secure additional supply.

The Stanhope site employs about 150 people including the milk supply group, with about 110 working in the factory.

At Fonterra Australia’s largest site of Cobden, AU$13.5 million is earmarked for robotic palletisers and improvements to the butter plant that produces Australia’s leading butter brand of Western Star, while another AU$8.6 million is being invested at Dennington in a new 25 kg packing line for nutritional powders and efficiency improvements.

Fonterra has also invested $12 million in its Tasmanian sites at Wynyard and Spreyton, $7 million at Darnum in Gippsland to support higher production of nutritional powders, whole and skim milk powders for the domestic and international export markets, $13.5 million for projects at Cobden and $8.6 million at Dennington in western Victoria.

LAST PRODUCTS ROLL OFF ROCHESTER LINE ALTHOUGH it has been a long time coming, it was the end of an era last month when Murray Goulburn’s Rochester plant produced its last dairy products and was officially closed.

It was a sad day for the workers, their families and the town.

Saputo chief executive Lionel Saputo Jnr said in November there were no plans to reopen Rochester if Saputo was successful in its takeover bid, but he left the door ajar if milk was to return to the business.

“We trust the evaluation that the MG management has taken,” he said.

“Again, with 1.9 billion litres of milk there isn’t enough milk in the system to support those plants reopening.

“Until such time we come back to a higher level of milk and need incremental capacity, I don’t think the plants will open up.”

Mr Saputo said there were opportunities to drive efficiencies and “shave some costs” in the MG business, pointing to “something as simple as lease and leases of space MG may have or perhaps some other expenses that may not be necessary”.

Rochester was closed in an attempt to create efficiencies following an exodus of suppliers.

Milk supply from Rochester region has transferred to Murray Goulburn’s Cobram factory along with the manufacturing

of many cheese products previously produced at Rochester.

Whey powder production at Rochester will move in time to the company’s Leongatha site.

The Rochester site was acquired as part of the merger with the Rochester Butter and Canning Company in 1963.

Campaspe Shire councillor Leigh Wilson said there had been some interest from outside businesses in the site, but nothing was yet firm.

Asked about the mood in the town on the last day, Cr Wilson said it was a sad moment, but most people were just glad to see it over with and they wanted to move on.

“We are a resilient community. We will survive,” he said.

The gates are shut at Murray Goulburn’s Rochester plant.

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6 // NEWS - VICTORIA

Burra to ship formula direct to China STEPHEN COOKE

BURRA FOODS will pack and export infant

formula direct to China following a $24.5 million investment in its Korumburra factory.

The State Government-funded expansion will allow the Gippsland company to export formula direct to the Chinese market, removing the need to can and label offshore.

CEO Grant Crothers said this would increase profits, maintain its competitiveness in a competitive sector and potentially increase returns to suppliers.

The expansion comprises a new building to

OLD FACTORY MAKING POWER FOR NEW A Goulburn Valley businessman is working on a novel energy project which will use food waste to generate power for a new dairy factory.

Ian Bertram has received a Victorian Government grant towards the project based at the

house the upgraded canning and repacking lines; plant and equipment for powder handling and blending and utility upgrades and external infrastructure.

This will enable the company to shift production of milk powder in bulk (25 kg bags) to consumer packs (400 gram and 800 gram cans) suitable for specific export markets such as China.

It will also enable increased production of other powdered milk products including adult, student and pregnancy powders, as well as high protein skim and full cream milk, which will maximise the revenue and economy of scale from the existing manufacturing equipment.

The project will increase profits from exports as it becomes further incorporated into a global supply chain, leading to the potential for better milk pricing for dairy farmers and suppliers.

Mr Crothers said the expansion was a further sign of Burra’s confidence in the industry and its ability to succeed in this competitive category.

“Led by changing regulations in the Chinese market, the Nutritional Milk Powder category has been volatile in recent times but with persistence and lots of hard work, we have successfully carved out a sustainable niche and built confidence around the future,” Mr Crothers said.

“The $24.5 million initiative to build blending and canning capability on site is further commit-

ment to South Gippsland and our most significant expansion initiative since 2011.

“It heralds the introduction of new skills and will enable Burra to deliver ‘consumer ready’ canned products,” he said.

Mr Crothers said the project will generate up to an additional 39 jobs on site. The new jobs at Burra Foods would suit employees made redundant from Murray Goulburn’s Leongatha plant last year.

Mr Crothers said site works could begin early this year once local government planning approval is completed. It is expected the project will be completed late next year and commissioned in 2020.

former Heinz factory at Girgarre Plastic material would also be which was once a cheese factory. recovered for re-use.

Australian Consolidated Milk is Mr Bertram’s company has been planning to build a new dairy factory processing out-of-date food and on a green-field site next to the old drink products for use as stock feed. facility this year and may be the Ms Bakaya is the founder and power generator’s best customer. chief executive of Renewology, Australian entrepreneur a clean energy company which Priyanka Bakaya is working with aims to divert plastics from landfill Mr Bertram’s company, Resource towards renewable energy sources.

Resolution, to develop a bioA facility in the United States is digester that will generate electric already converting plastics into fuel. power for the grid using waste food.

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NEWS - QUEENSLAND // 7

Linking Sunshine Coast dairy with local consumers RICK BAYNE

AUSTRALIANS’ LOVE of coffee and interest in healthy drinks could provide a lifeline for dairy farmers on Queensland’s Sunshine Coast.

A pilot study into the state of dairying in the region and opportunities for growth along the supply chain is giving fresh hope to the local industry.

Dr Kathy Hastings, part of a group at the University of Sunshine Coast that specialises in food marketing, was asked in 2015 by Sunshine Coast Council to look at local food and agribusiness industries.

Her study identified the dairy industry as one of the region’s “nuggets”, even though it was in a distressed state, and a subsequent pilot program with Dairy Australia is looking at strategies to stimulate industry growth and improve local marketing.

The Sunshine Coast dairy sector processes about 80 million litres of milk per year and 45 per cent of goods produced locally are consumed locally.

Dr Hastings said that although the region had lost 66 per cent of its farmers since 2007 and most

of those remaining were not confident about the future, research has identified positive opportunities.

“We have a large value-add component for our dairy industry, one of the highest in the east coast of Australia,” she said. “We have three milk processors, yoghurt makers, cheese and gelato companies and the Sunshine Coast has great paddock-to-plate opportunities.”

The Sunshine Coast dairy sector processes about 80 million litres of milk per year and 45 per cent of goods produced locally are consumed locally.

The pilot project has brought together players along the supply value chain line, including farmers, processors and retailers. “We started working with them as a cluster and talking about their issues and how we could help,” Dr Hastings said.

She admitted farmers weren’t confident about the opportunities but the research could change that perception.

“The research found the dairy industry is actu-

ally on the move and has quite a lot of opportunities opening up, particularly for the Sunshine Coast region and its independent processors,” Dr Hastings said.

A review of consumers found that they want to support local farmers, and retailers believe the most important attributes to consumers are taste, support for local farmers and region of origin.

Increasing demand — both locally and nationally — for natural and premium ingredients could play into the region’s attributes.

The country’s love of coffee could also be a significant player in reviving the local industry.

“Our coffee industry is worth about $70 billion and growing, and every one of those coffees needs milk,” Dr Hastings said. “We’re saving the dairy industry by drinking coffee.”

Early in 2018 the Sunshine Coast milk cluster will work with the local Coffee Guild to develop co-branding opportunities.

“We want something for the locals that we can test locally,” Dr Hastings said. “If it works here it can work elsewhere.”

The cluster is working with Sunshine Coast Council to implement the plan and will then work with Dairy Australia to do a broader Queensland study with a focus on potential exports to the

Pacific and Asian countries.

Dr Hastings said the dairy cluster would also look at high protein drinks, fermented drinks and specialty cheeses “That’s where trends are going,” she said “There is interest in health and indulgence and increasing demand for convenient, healthy and satisfying snacks and growing concern about processed and artificial ingredients.”

“We’re encouraging the industry to go upmarket to get to the top end and follow the trends and believe they are well placed locally.”

Dr Hastings said that improving insights into consumer attitudes towards milk products and improving local marketing could help the industry.

One local manufacturer had increased sales by 70 per cent on the back of a local social media campaign.

“We don’t know what potential it has to turn the industry around but we do know there’s hope.

Most within the value chain feel the sector has opportunities with good quality products and better distribution and local marketing.”

Potential “game changers” including an international airport at the Sunshine Coast, a new airport and dairy manufacturer at Toowoomba and even the arrival of Amazon could open more opportunities.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

8 // NEWS - SA

Grass roots approach to farm safety RICK BAYNE

JERVOIS DAIRY farmer Michele Golder has

been part of a committee guiding a new Dairy Australia farm safety starter kit currently being rolled out across Australia.

Mrs Golder said all farmers could benefit from the new kit and adapt its information to suit their business.

“It will help farmers to become more

aware of their health and safety obligations,” she said.

“It looks at different aspects of farm safety; such as use of quad bikes and working in confined spaces, and gives information and help we need as farmers to establish safety programs and procedures.

“I find it difficult to create a policy from scratch so templates were important for me.”

Mrs Golder said the initiative is an important part of changing safety culture on farms

and people’s perception about farming.

She and her husband, Lawrie, employ six staff in their business. They milk about 240 Friesians and have 100 beef cattle. They produce all their own hay and grain.

In 2009 in the midst of a bad drought they had considered relocating, retiring or restructuring, eventually opting for the latter after winning trips to Canada and USA through milk quality awards.

“We learnt a lot about feedlots and intro-

duced a partial mixed ration with a feed wagon.

It worked well and we were amazed at how much production improved.”

Mrs Golding said the rollout of the new safety kit is a proud moment for her.

“It’s good to contribute to a safer dairy industry.”

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A NEW project which aims to help producers transition the management of family farms to the next generation will be rolled out in South Australia this month.

The Farm Management for Transition Workshops John Christensen. will see 28 South Australian farming families from across the state take part in three half-day workshops.

The workshops are conducted by Rural Business Support (RBS) and supported by the Aussie Farmers Foundation.

RBS Farm Business Advisor John Christensen said the free workshops would help SE producers plan for succession of the family farm.

Topics include starting the conversation, family expectations, conflict strategies, planning, required skills, work force management, developing support networks, management systems and measures that matter.

“The workshops will help families answer: Where is our farm going and how will we get there; what is the best management system for our farm’s future; and, do we have the right business skills to implement this system and keep our farm on track?

Participants will receive practical tools and processes to be implemented on-farm to improve communication, resolve conflicts and align personal aspirations with farming business goals.

“Through delivery of the well-known Rural Financial Counselling Service and our other farm business programs, RBS understands that for succession to be successful, the key people need to have the right business skills, knowledge and personal aspirations to transition into management,” Mr Christensen said.

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10 // NEWS

Dairy inquiry a “wasted opportunity” New South Wales THE NSW Farmers’ Association has slammed

the Australian Competition and Consumer Commission, describing its ongoing Dairy Inquiry as a “wasted opportunity”.

NSW Farmers’ President Derek Schoen said the competition watchdog’s interim report fell well below the expectations of dairy farmers across Australia.

“This inquiry is a once in decade opportunity

to resolve competition issues within the dairy industry,” Mr Schoen said.

“If findings of ACCC’s interim report are indicative of the Inquiry’s outcomes, this has been a wasted opportunity.

“Many dairy farmers are operating on wafer thin margins, and this inquiry does nothing to address this.”

In its submission to the Inquiry, NSW Farmers expressed its noted its disappointment at: ■■ The lack of rigour in analysing the various

■■

■■

markets for dairy, including poor market definition ACCC’s tendency to excuse or justify retailer behaviour as being consistent competition and consumer outcomes, even where there is a lack of analysis or evidence to make such claims ACCC’s draft recommendations that would only have a marginal impact on improving competitive outcomes within the dairy supply chain

The benchmark for production and performance

“We appreciate recommendations calling on farmers to seek professional advice before entering supply contracts, however, the formulation of such recommendations did not require a timeconsuming inquiry process.

“What we need is some real action against processor and retail market power.”

The Association said it was “astonished” the ACCC found dollar-a-litre milk was good for consumers.

“Let’s dispel this myth that dollar-a-litre fresh milk is good for the consumer. Coles and Woolworths are using fresh milk as a loss leader to get customers through the door, and recouping any lost margin on other grocery items in customers’ shopping trolleys.

“In a competitive market, a higher retail price for fresh milk should increase margins for not just retailers and processors, but also primary producers. The fact that these margins are not being shared equitably is a demonstration of the uncompetitive nature of the dairy supply chain.”

The Association has reiterated its support for the ACCC’s focus on agricultural related supply chains.

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WESTERN AUSTRALIAN farmers are being encouraged to monitor livestock for signs of kikuyu poisoning after summer rains.

The Department of Primary Industries has confirmed one diagnosis of kikuyu poisoning in cattle in the Great Southern and has received several other reports of cattle losses in the region that are consistent with the disease.

Kikuyu can poison livestock on rare occasions given the right environmental conditions.

Department veterinary officer Andrew Larkins said it was important for producers to monitor animals closely over the summer period and investigate any signs of disease.

“Kikuyu poisoning most often occurs in areas that have seen a long dry spell or other form of plant stress, followed by a large amount of summer rain that cause the grass to grow rapidly.

“Paddocks that have been left ungrazed prior to rain can become quite lush and usually pose the biggest risk to stock.

“The onset of illness in livestock is rapid and animals can often be found dead.”

Signs of kikuyu poisoning in stock usually appear up to eight days after being moved into the affected paddock and include unusual vocalisation, looking bloated, drooling, lack of coordination, lying down and reluctance to move, and sham drinking.

Dr Larkins said that removing stock from paddocks where animals experienced signs of poisoning was essential to prevent further illness. The paddock should also be kept free from stock for as long as practical to prevent further losses.

“Many animals will recover given supportive care,” he said. “As with any possible toxicity, moving animals slowly and providing them with good quality shade, water and hay are important.”

DAIRY NEWS AUSTRALIA FEBRUARY 2018

NEWS // 11

Think long-term to avoid effluent regulations AUSTRALIAN DAIRY farmers are more likely to develop workable solutions to effluent disposal if strategies are developed in collaboration with industry organisations and government agencies, according to a new report released this month by 2016 Nuffield Scholar and Cohuna dairy farmer, John Keely.

Mr Keely’s Nuffield research, supported by the Gardiner Foundation, looks at effluent disposal techniques around the world, and finds that all players in production chains need to assume responsibility for effective land management if the imposition of burdensome regulatory regimes is to be avoided.

A fifth generation dairy farmer, Mr Keely runs a herd of over three hundred milking cows near Cohuna. The Keely family have owned and operated the farm since 1874, and this long history of land stewardship saw him develop a keen interest in sustainable farm management practices.

It was this background that motivated Mr Keely to focus his Nuffield research on innovative effluent management systems around the world.

“My vision is to build sustainable farm management practices into what we do at home every day, as this will inevitably lead to greater efficiencies, carrying capacity and improved income.

“I’ve observed that as dairy operations in Northern Victoria get bigger, they are becoming more intensive, and the need for environmentally sustainable effluent management systems is becoming more and more critical,” Mr Keely said.

“Average herd size has increased from 93 cows in 1985 to around 284 cows today. This has led to an intensification of the industry resulting in the widespread use of feed pads and loafing areas.

“These practices see large amounts of manure build up quickly, and I know I’m not alone in the struggle to develop cost effective and environmentally sustainable management methods in response.”

Mr Keely’s Nuffield experience saw him visit intensive operations around the UK, Europe, the Netherlands, Denmark, United States, New

Zealand and Canada, where he met with farmers and researchers and observed a range of innovative effluent use and disposal methods.

His research led him to conclude that the regulatory environment within which Australian dairy farmers operate is more relaxed than other countries. He attributes this partly to the abundance of space and lower soil fertility levels in Australia.

He said this softer regulatory environment has allowed many in intensive industries to opt for effluent management solutions that are cost effective in the short term, but not necessarily sustainable over the long term. Mr Keely finds this to be in stark contrast to many overseas regions, where farming is more intense, space is at a premium and farmers have been obliged to employ innovative solutions in order to stay profitable in strict regulatory environments.

“Denmark has one of the strictest systems in the world. The authorities there often undertake random inspections to monitor land use, feed mixtures, fertiliser inventories and the management of slurry and chemicals.

"If we don’t set a new higher standard, we are at risk of poor management triggering strict and burdensome regulation."

John Keely, Cohuna “In this environment, Danish producers have innovated and are now substituting significant amounts of artificial fertiliser with treated pig and cattle waste.

“This shift has resulted in an astounding 56 per cent reduction of nitrogen run off into the aquatic environment since 1985. Likewise, phosphorous leeching has been reduced by 98 percent over the same period.” Mr Keely said.

The report also highlights businesses in the Netherlands that have started processing and exporting effluent and manure as fertiliser throughout Europe, a solution Mr Keely puts down to a strict regulatory environment com-

John Keely in Ireland as part of his Nuffield Scholarship research tour.

pelling producers to create savvy management solutions.

“Australian farmers generally use the cheapest method to apply effluent and manure. This is understandable, but overseas examples demonstrate that the cheapest application method is not always the most cost-effective over the long term,” Mr Keely said.

“In the absence of regulatory guidelines, many farmers will inevitably default to the cheapest disposal method available. More support from government bodies directed toward sustainable farming and encouraging farmers to implement best practice is needed if sustainable business and environmental outcomes are to be achieved.

“Industries are intensifying, and community expectations in this area are ever-growing. If we don’t set a new higher standard, we are at risk of poor management triggering strict and burdensome regulation which could damage the competitiveness and sustainability of the Australian primary production sector.

“It’s vital that governments, regulators and farmers work together to incentivise best-practice land management,” he said.

EXTRA FEES FOR LIVE DAIRY EXPORTS All dairy cattle sold for export will incur a new charge of $6/head.

The charge has been supported

by Australian Dairy Farmers.

The charge will be collected by industry service provider LiveCorp to delivery technical support for dairy cattle export supply chains and fund RD&E programs specific to Australia’s dairy cattle trade, which is worth almost $130 million annually.

A ballot held late last year to vote on the charge saw 80 per cent of registered exporters voting in favour of the new charge.

Australian livestock exporters currently pay statutory export charges on exported beef cattle, sheep and goats.

In 2006, livestock exporters initiated a voluntary charge on exported dairy cattle to enable funding for sector-specific RD&E and marketing at a rate of $3 per head.

In 2014, ALEC members voted to increase the voluntary dairy cattle charge to $6 per head.

Australian Livestock Exporters’ Council (ALEC) CEO Simon Westaway said the voluntary charge had been significantly under-collected and, as such, has not been sufficient to meet the RD&E and marketing needs of our dairy cattle export trade.

Mr Westaway said LiveCorp and the Federal Department of Agriculture and Water Resources (DAWR) had now been advised of industry’s strong endorsement for the new statutory charge.

“Peak producer groups including Australian Dairy Farmers and the National Farmers Federation support the statutory charge for dairy cattle exports because farmers recognise the importance, and further potential, of Australia’s dairy heifer export market,” he said.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

NEWS - TASMANIA // 13

Australia Day gong for Ringarooma’s Legendairy couple RICK BAYNE

THE DRIVING forces behind Ringarooma’s success as Australia’s 2017 Legendairy Capital, dairy farmers Marcus and Simone Haywood, have been rewarded with an Australia Day volunteer honour.

Marcus and Simone were named Dorset Council’s Volunteers of the Year for their efforts in spearheading Ringarooma’s successful nomination for the Legendairy Capital program.

Mr Haywood said the award was unexpected but another welcome recognition for the local community. “We were both over the moon about it; humbled and grateful at the same time,” he said.

“You’ve got to be in it to win it so we thought why not have a dip?” he said. “As it turns out we took out the national title, so it worked out pretty well for us.”

The Heywoods said the town had embraced the Legendairy Capital title.

“At the awards, our Mayor Greg Howard welcomed everyone to the Legendairy Capital of Australia, which was pretty cool.”

Mr Haywood was also named DairyTas Young Dairy Farmer of the Year in early 2017 but says the town’s Legendairy Award is the pinnacle.

“The best award is being the national Legendairy Capital because it involved the whole community,” he said. “Just seeing the smiles on everyone’s faces when we won was awesome.”

As Legendairy Capital of Tasmania, Ringarooma received a $2500 community grant to renew recreational areas at Ringarooma Primary School.

After being named Australia’s 2017 Legendairy Capital, the town secured an additional $7500 to help restore the school’s historic dairy to connect students with the area’s local dairy history.

Marcus said it was hoped to turn the former dairy into a calf rearing area to give children from non-dairy backgrounds a chance to learn about the industry.

“Each year there is a calf rearing contest at the local show but kids not from a dairying background don’t get the opportunity because they don’t have their own calves,” he said. “This will give them the chance to rear and enter a calf under their own name.”

Dairy Australia Managing Director Ian Halliday said Marcus and Simone should be commended for their wonderful contribution to the town and Legendairy Capital program.

“Marcus and Simone were instrumental in coordinating the community and submitted

IN BRIEF Fonterra invests in Wynyard, Spreyton

Simone and Marcus Haywood have been rewarded with an Australia Day volunteer honour for their work behind the Ringarooma Legendairy campaign.

a comprehensive submission which provided insights into how Ringarooma fostered community spirit and connectedness through adverse times.”

Fonterra has invested $11 ½ million across its two Tasmanian factories, expanding its cheese plant in Wynyard and lifting lactose processing capacity at its Spreyton site.

The $9.7 million Wynyard investment will support an annual increase in cheddar cheese production by around 3900 metric tonnes and increase the daily milk volumes processed from 1.3 million litres to 1.5 million.

A further $1.8 million will be invested in Spreyton to lift its capacity to process lactose.

Fonterra Australia CEO, Rene Dedoncker, said more capacity requires more milk and Fonterra Australia was working hard to secure this.

“With this new investment we plan to grow our milk further which we expect will come through growth from our existing farmers who wish to grow, coupled with milk from new suppliers joining Fonterra.”

Fonterra has also invested in new truck and trailer units across its milk collection regions in Tasmania.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

14 // NEWS - IDW

Pam Malcolm celebrated at Power Of Women dinner Ms Malcolm was overwhelmed and honoured to receive the award and, fighting back tears, she told the crowd she bred cows because, simply, it was what she loved.

The night also included guest speaker and former dairy farmer Di Schubert.

Ms Schubert spoke about her career in the industry and the highs and lows she experienced There was a full house at the third annual Amelia Morris from Nagambie spoke about her personal battle with mental illness. during that time, including taking over the run- Power of Women in Dairy dinner. ning of the dairy farm after the unexpected loss of her first husband, the joy of showing cows and the low of losing a third of her dairy herd to botulism.

Amelia Morris from Nagambie spoke about her personal battle with mental illness, a battle which led her to attempt to take her own life in 2015.

Ms Morris is an ambassador for Orygen, the National Centre of Excellence in Youth Mental Health.

“There is no shame in having a mental illness, it’s no different to being physically ill and I do think things are changing and there is a lot more awareness around the issue than there used to be.

It is so important to speak about it and not hide it away,” Ms Morris said.

The night concluded with a parade of vintage Christian Dior hats as part of the Hats for Hope program (a fundraising initiative that supports Pam Malcolm (centre) was awarded the Bette Hall Power of Women in Dairy Award for ExcelOrygen). lence. She is pictured with previous winners Lyn Boyd (left) and Jenny Grey.

SOPHIE BALDWIN

WOMEN FROM across the country gathered at International Dairy Week to network, learn and inspire each other, as part of the third Power of Women in Dairy dinner.

The dinner celebrates the strong, passionate and successful women involved in the dairy industry and organiser Jade Sieben said it was great to see so many attend and enjoy some time away from the farm.

Celebrations included the announcement of the winner of the Bette Hall Power of Women in Dairy Award for Excellence, which was presented to Pam Malcolm.

Ms Malcolm, from Paringa Holsteins at Stewarton (near Shepparton) is a master breeder and well known in the dairy community.

“Pam has been breeding top production cows in Australia and New Zealand for the last five decades and is well known throughout the country for her dedication to the dairy industry,” Ms Sieben said.

“Pam once told me … ‘Life does not get any easier but we are all still here because of our love for the black-and-white cow’ — and that, I think, sums Pam up very well.”

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

NEWS - IDW // 15

ABS unveils new sexed technology ABS HAS launched Sexcel sexed genetics,

which utilises new technology.

Sexcel enables farmers to use the same sex technology across ABS’s best genetics and ABS Global Sexed Genetics Brand Manager, Olivier Hiers, said semen is produced through a novel, proprietary technology.

“This innovative technology does not subject the cells to the high pressures, electric currents and shear forces used to produce the sexed semen historically available to farmers,” he said.

Mr Hiers said ABS data showed Sexcel achieves a 90 per cent relative conception rate when compared to conventional semen and a ‘higher relative conception rate’ than other sexed semen used by dairy farmers.

“This data contains real results from real customers and is sourced from more than 37 million cows from herds located in key dairy markets throughout the world.

“We have a unique product, and trial results show it is a very effective sexed offering for our customers.”

Mr Hiers said prior to the launch of Sexcel, competition was restricted in the sexed genetics processing industry.

“Our research has shown that our customers are seeking a stronger line-up of sexed genetics

TOP CALF SELLS FOR $30,000

RODNEY WOODS The showpiece sale at International Dairy Week started with a bang when Lot 1, Eclipspeirce Modesty Canto-ET, sold for the top price of $30,000.

The World Wide Sires Evolution Sale, conducted by Dairy Livestock Services, could not live up to last year’s showstopping sale of $251,000, but still averaged $6990 for 33 lots.

Top price was paid for Eclipspeirce Modesty Canto-ET, owned by Garan Peirce, Richard Hull and Declan Patten.

The second highest price of the night was $17,000.

Auctioneer Brian Leslie was “ecstatic” with the result.

The top-priced lot was sold to Sexing Technologies Australia, and ST Genetics Australia general manager Peter Semmens said it was a first for the company.

“It was our first female purchase in Australia for our company,” he said.

Mr Semmens said the calf, born on August 17, 2017, was purchased because of its world ranking.

“She was purchased because of her standard in the world ranking of indexes.

“She is an outstanding heifer and is a valid purchase for our future breeding program.”

and Sexcel brings that to the marketplace.

“Our technology enables elite heifers to produce the replacement animals farmers want, while also providing farmers a choice of sexed genetics tailored to their specific needs — including calving ease, milk production, feed efficiency, reduction in disease risk or any number of genetic traits.”

ABS Global Sexed Genetics Brand Manager, Olivier Hiers, at IDW.

Mr Semmens said the calf would now call Brad and Jessica Gavenlock’s Tallygaroopna property home.

“She will be part of an embryo program and we will endeavour to make bulls for the Australian bull team and make some females as well,” he said.

Declan Patten, Mark Patullo, Scott Lord, Brian Leslie, Garan Peirce and Charlie Lloyd with the top-priced heifer.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

16 // OPINION RUMINATING

EDITORIAL

Farmer confidence needed to fill stainless steel

MILKING IT...

Sentient beings

On the other hand

Give it to us straight

The Victorian State Government is heading down a slippery path in its dealings with animal liberation groups.

The new Animal Welfare Action Plan, released last month, recognises the sentience of animals – or their capacity to feel, perceive or experience subjectively.

It looms as a grey area that extreme animal welfare activists could use to tie the farming sector up in knots in court.

Cash is not an issue for these crowds which benefit significantly from crowd-funding campaigns, led by celebrity activists.

Trying to appeal to an extreme sector can lead to extreme consequences. Brexit springs to mind…

Maybe we’re giving these groups too much credit.

We remember when Dairy Australia received an unexpected influx of visitors that decided to sit down and hold a silent protest in their Southbank foyer.

When the DA team called the police for advice, they were told: Water. Offer them plenty of water.

This hospitality had the natural consequences and the protestors dribbled out (no pun intended) one by one to seek respite in the public toilets nearby.

Just a heads up for the Fonterra communications team: Journalists normally head straight to the end of a media release because that’s where companies ‘hide’ the real news.

It’s best not to headline a media release, as you did on December 13, with ‘Fonterra Australia increases farmgate milk price for the 2017/18 season’ when you’ve actually (wait for it) dropped the milk price.

A step-up of 10c/kg, while simultaneously revising the end-of-year forecast by 10c/kg, is not increasing the price.

There are further mixed messages attributed to CEO Rene Dedoncker who says it is prudent to reduce the top end but is confident about the ‘price rise’.

Crikey! Journos are fortunate they don’t have millions of dollars on the line like dairy farmers do with mixed messages like this.

Advertising Aaron Brown

Due diligence The ACCC’s review into Saputo’s acquisition of all Murray Goulburn’s assets and operating liabilities won’t be completed until March 1, pushing the original date back by two weeks.

The corporate watchdog (which some dairy farmers say lacks teeth after reading its interim review into the dairy industry) told MG it was because it needed more time to consider the large amount of data.

Seems to us that the ACCC will have more time reviewing MG’s assets than its potential buyers did!

MG says the transaction is still anticipated to be completed by June 30.

0409 236 063

aaron.brown@dairynewsaustralia.com.au Editor Stephen Cooke

Publisher

Printed by Production

It’s disappointing that we have to repeat ourselves at the start of a new year but we are compelled to say it: Processors, work with farmers to grow the national milk pool.

Our critique is not limited to Fonterra but their recent announcement reveals that old habits are hard to break.

Fonterra announced it is investing $165 m in its Victorian and Tasmanian factories, with most of the money to be spent at Stanhope to expand its cheese operation.

The investment was heralded as a vote of confidence in the industry. Fonterra wants to grow its milk supply and says: “With this new investment we plan to grow our milk further which we expect will come through growth from our existing farmers who wish to grow, coupled with milk from new suppliers joining Fonterra.”

It has grown its milk supply by 400 million litres, predominantly by approaching disgruntled Murray Goulburn suppliers last year. It is not growing the national milk pool, it is increasing its slice of the existing pie.

Rival processors may offer slightly higher prices to entice farmers to switch but unless they offer incentives to grow, and share the risk, they remain at risk of losing them in the future.

Much of Murray Goulburn’s strength came from loyalty to the co-op, and that couldn’t be bought. That’s been lost, with even the most loyal supporters forced to leave when prices fell too low.

Under this new paradigm, processors need to work more closely with suppliers to ensure milk security. Adding stainless steel and asking farmers to fill it, all at their own risk, won’t cut it.

There are still farmers selling cows to pay for the cash flow problems caused by Murray Goulburn and Fonterra’s decision to slash prices 18 months ago, while UDV President Adam Jenkins has said although Fonterra’s investment was welcome, there is still “a long way to go to rebuilding trust in the industry”.

Processors need to work with their suppliers to grow the pool so the entire industry benefits. The industry needs to move on from the days where offering two cents more a litre is the best we have.

Shepparton Newspapers Pty Ltd Newsprinters Pty Ltd Stacey Taylor

0427 124 437

editor@dairynewsaustralia.com.au Dairy News Australia is published by Shepparton Newspapers Pty Ltd. All editorial copy and photographs are subject to copyright and may not be reproduced without prior written permission of the publisher. Opinions or comments expressed within this publication are not necessarily those of the staff, management or directors of Shepparton Newspapers Pty Ltd.

Regional editor Geoff Adams

news@dairynewsaustralia.com.au

WWW.DAIRYNEWSAUSTRALIA.COM.AU

Head Office 7940 Goulburn Valley Highway Shepparton, VIC 3630 Phone (03) 5831 2312 Postal address PO Box 204 Shepparton, Victoria 3632 Australia

DAIRY NEWS AUSTRALIA FEBRUARY 2018

MARKETS // 17

Rising tide of milk weighs on sentiment THE “RISING tide of milk” has seen sentiment

in the global dairy industry begin to wane, as growth in exportable surpluses across key milkproducing regions gains momentum, according to Rabobank’s latest Dairy Quarterly report.

The report says the global market will “confront a wave of exportable surplus” in coming months, estimated to be 3.2 billion litres higher year-on-year (in liquid milk equivalents) for the six month period October 2017 to March 2018.

Rabobank senior dairy analyst, Michael Harvey, said the recent growth in global milk supply, which peaked in the last quarter of 2017 with the Oceania spring peak and a return to growth in Europe, is taking its toll on global commodity prices.

Mr Harvey said “supply growth is emerging as the biggest risk for global dairy markets”, with the entire dairy complex witnessing weakness.

“Even butterfat prices, which had been defying gravity, have fallen in recent months,” he said.

“However the low stocks of butter and robust demand are expected to support prices well above the five-year average.

“Meanwhile skim milk prices remain depressed, with the closure of the European intervention scheme removing the floor and allowing prices to soften further.”

While there is no immediate end in sight

for weak skim milk powder prices, which have dragged the whole milk price lower, Mr Harvey said the global cheese market has “fared best” with the buoyant importing of cheese in countries like Japan and China providing support.

Mr Harvey said with pressure expected to build on global commodity prices, the first signs of weaker milk prices (in local currency) have emerged in a number of export regions.

Rabobank has revised its fullyear milk price in southern export regions for 2017/18 to $5.50/kg milk solids (MS), down 20c/kg MS on previous forecasts.

“In Australia, the downward pressure on global prices, together with a stronger currency, has seen Rabobank revise its full-year milk price in southern export regions for 2017–18 to $5.50/kg milk solids (MS), down 20c/kg MS on previous forecasts — but excluding any supplementary payments and market premiums,” he said.

While the growth in global exportable surpluses is likely to place pressure on the global dairy complex through to the middle of 2018,

Mr Harvey said “exportable surpluses are not expected to completely overwhelm global markets, helped by strategies to limit supply growth from processors”.

“China will also play a key role in ensuring global markets remain ‘fairly balanced’, with their import purchasing demand, assisted by lowerthan-expected milk supply and some improvements in demand, expected to remain active throughout 2018,” he said.

Mr Harvey said there is unlikely to be a smooth recalibration of the dairy complex, however Rabobank is forecasting a gradual tightening of exportable supplies through the second half of 2018.

“Much will hinge on production trends in Europe, and while supply growth is set to continue, an easing of milk prices and efforts to contain supply growth in some regions is likely to constrain growth.”

Mr Harvey said dairy policy interventions in the EU will be a key ‘watch factor’ in 2018, as well as the risk of a US exit from NAFTA, and geopolitical tensions — all of which could create volatility in global dairy markets.

Australian outlook Mr Harvey said improving milk prices and favourable seasonal conditions are starting to flow into

Michael Harvey.

a recovery in Australian production and exports, with national milk production forecast to increase by 2.7 per cent in the 2017–18 season.

“With most of the growth coming from the southern export regions, particularly Victoria, the good reserve of high-quality fodder, good soil moisture and high water entitlement for irrigators is boding well for a strong shoulder and solid finish to the season.”

Mr Harvey said Australia’s exportable surplus has contracted significantly over the past 18 months, and “it is only now that the benefit of improving milk supply will start to drive a recovery in exportable surpluses”.

“In export markets, while demand growth is starting to moderate following a period of robust growth, dairy demand in emerging economies appears to be strong, with robust import purchasing in key deficit regions, including SouthEast Asia.”

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

18 // MARKETS

Silly season?

FRESH AGENDA JO BILLS

Try Veganuary versus Februdairy

I’M GUESSING most DNA readers didn’t par-

ticipate in or perhaps have even heard of Veganuary! It’s a mostly UK phenomenon, a pledge to go vegan for the month of January.

Veganuary claims a record number of people — 167 000 — pledged to try a vegan diet for a month this year.

Veganuary was launched in 2014 with just 3300 people pledging to change their diets — there is no information provided by the organisation on how many people remain vegan for the remainder of the year and beyond.

While the numbers might be small, the media coverage in the UK this year has been quite significant. Vegan activists — including Joey Carbstrong, an Australian with a significant social media following and Earthling Ed — appeared on the BBC breakfast with a UK dairyfarmer Paul Tomkins to discuss the issues — and scored quite a few points.

Some of these more militant activists, like the ones that invaded a Melbourne steakhouse recently — who describe farming practices using offensive and emotive terms like rape, murder and enslavement — may be easy to dismiss and belittle as “nutters”.

It’s possible these tactics turn as many people off adopting a “vegan lifestyle” as they convert.

However, as an industry we ignore this movement at our own peril.

High profile vegans such as Beyoncé, Ellen DeGeneres and Formula One driver Lewis Hamilton cite health, compassion for animals and environmental concerns as their reasons for eliminating meat and dairy from their diets.

They are successful and attractive role models for a lifestyle choice that many people — particularly young females — are adopting for one or all the same reasons.

While it would be easy to call out the hypoc-

risy of someone like Hamilton professing concern for the environment while pursuing a career that involves burning fossil fuels for entertainment — he maintains he is doing what he can to reduce his carbon footprint!

Many of these celebrities and their diets are covered in an uncritical, and in fact admiring way by the media — which credits vegan diets with making skins glow and keeping bodies lean and healthy.

A moral superiority is also implied which only increases the appeal for young consumers — with limited understanding of farming systems but plenty of access to sensational Netflix documentaries.

It is hard to deny that veganism is on the rise.

Certainly, many corporates are getting on board.

Tyson Meats has made well publicised investments in synthetic meat start-ups and the proliferation of alternative, plant-based “milks” is a market response to increasing consumer demand.

Goldman Sachs announced just last month their investment in a pea-milk start up that raised US$65 million. Bloomberg reports that in the past four years, investors have pumped over US$1 billion each year into food and beverage start-ups including Impossible Foods — which makes plantbased burgers, and Memphis Meats which grows meat from animal cells.

Perfect Day is a Silicon Valley start-up that makes synthetic milk by altering the DNA of foodgrade yeast to produce facsimile milk with almost identical properties to the real thing.

So back to the UK, where some in the local dairy industry decided to launch their own grassroots response to Veganuary — Februdairy. Well respected livestock sustainability expert Jude Capper has been the driver of the largely Twitter-based campaign using the hashtag #Februdairy.

It aims to promote the industry with 28 days of positive information about all aspects of dairy production.

Unfortunately, the Twitter conversation has largely been hijacked by vegan activists. UK dairy people have gamely tried to engage with many activists, to dispel myths, defend against attacks and misinformation — but with varying success.

Not many people or consumers are on Twitter so it could be argued that the fallout from these interactions will be minimal. However, as Donald Trump’s tweets demonstrate — what happens on Twitter doesn’t always stay on Twitter.

Social media discussions are routinely picked up by mainstream media, reaching a much wider audience. A Google search on Februdairy at the time of writing turned up mostly articles from vegan publications criticising the campaign and the industry.

It’s clear this campaign was never meant to convert vegans to dairy, but arguably mimicking a campaign to recruit vegans was unnecessarily antagonistic.

Pro-dairy tweeters are clearly making an effort to be polite but they are defensive, and unlike many of their vegan counterparts they do not have ready facts or emotional memes at their fingertips. The fallout demonstrates what can happen on a social media platform that is pretty difficult to control.

The lesson that could be learnt from this is to have a clear idea of who you are trying to target and what messages will work with that audience.

A good example is the homegrown “Show some #dairylove” Facebook group which had a clear objective of creating a positive space for dairy farmers to talk to and support each other.

It has some dedicated admins who ensure that it stays true to its purpose and with over 15 000

High profile vegans include Beyonce.

members and lots of activity it has been highly successful at that.

Engaging with a community that has limited direct exposure to dairy — or any — farming and may feel some unease or distrust about it is a much more challenging exercise.

Consumers have been encouraged to believe that they can make food choices that all but eliminate any impact on the environment, help them live forever and be “better”, kinder people.

Rather than completely dismissing these types of aspirations, the industry needs to think seriously about how to regain and grow trust in a highly nutritious and delicious product that has helped sustain humans for centuries.

How should those in livestock industries talk about practices that the general community may not understand — or condone. Consumers have many choices, the industry needs to help them feel good about choosing dairy.

• Jo Bills is a director of freshagenda.com.au

CMV slides as supply builds THE COMMODITY Milk Value (CMV) has

continued to slide over the past few months as concerns about the strengthening EU milk production increase.

After peaking at US$6,200/t back in August butter ended January at US$4,940/t as buyers pushed back on high prices and supply shortages ease. SMP prices continue to suffer under the weight of large EU intervention stocks, with spot prices now at US$1,835/t. The EU Commission has implemented further significant policy changes that affect every dairy farmer with an exposure to the world market, avoiding further additions to their aging powder mountain when their intervention (government buy-back) program opens in March — which has further undermined SMP values.

Importantly for Australia’s export returns, spot prices for cheddar which were resilient for much of last year have also retreated, with the expectation that more EU milk will be directed to cheese rather than SMP/butter production in 2018. Cheddar spot prices out of New Zealand ended January at US$3,550/t. WMP has been rel-

atively steady as the New Zealand availability has been constrained, although value has been capped by low SMP and vegetable oil prices.

The Australian dollar has added around 4 cents against the US currency over the course of the season, which has further undermined the CMV. After opening 2017–18 at $5.05 kgMS the CMV stood at $4.42 kgMS at the end of January.

Weather concerns in New Zealand and reduced online availability have been behind the positive GDT results that have kicked off the new year. Looking ahead, the size of the EU spring peak will be the critical factor influencing milk value for the remainder of the year and into 2018–19.

About the Commodity Milk Value Freshagenda’s approach to assessing milk price outlooks recognises there are two components of milk prices paid by manufacturers in southern Australia — a commodity value of milk, which reflects the returns from the global market for dairy products, and an additional value captured on top of base commod-

ity returns.

The commodity milk value (CMV) measurement and outlook is based on spot prices and Freshagenda’s forecasts of fundamental values of major commodity products (cheese, butter, whole and skim milk powder), based on our rolling outlook for the global dairy trade balance. Projected product values are converted

into a value of milk at farmgate using the industry’s product mix, deducting conversion costs, and converting to Australian dollars per kilogram of milksolids. Between 2011–12 and 2016– 17 the CMV has averaged over 80 per cent of final farmgate returns — ranging between 70 per cent and 95 per cent of the final average price paid by manufacturers in southern Australia.

agribusiness // 17 DAIRY NEWS AUSTRALIA FEBRUARY 2018

ort demand remains strong

MARKETS // 19

A mixed bag for Australian farmers

cents/litre in March (AUD 41c/L) to 28 a few incremental change in milk production (year-on-year) Euro cents/litre (AUD 36c/L) in April. s now Profit margins are under pressure in the s farmUS, and in NZ Fonterra has announced oming the final payout for the 2011/12 season ocused has been cut from NZ$6.75-$6.85/kg MS incorgLobaL impacT to NZ$6.45-$6.55/kg MS (AUD$4.96ed ‘tier GLOBAL IMPACT JohN DropperT JOHN DROPPERT $5.04). armer Effectively, global dairy markets are y. For rebalancing. Lower prices will both iented Shifts in private label contracts and proslow production growth and stimulate ative to cessor rationalisation have seen milk over the period, easing usual in requiretrading activity over and likely to add another 1 per cent (of 150 billion siderably demand, and as same this occurs we will ulti- 12 per cent companies adjust theirlull intake to the AFTER THE frommately 620 0see 00 atonnes to around 546 000 tonnes, dairy market participants are again litres) in 2018. price recovery.

Key factors ments and pricing to meet the changseems Christmas, watch of on the scene will be the ing demands highly pressured m term taking thisglobal decrease appearing to have In a positive sign, the size of the region’s dairy with tomuch stock of ofathe supply andretail demand dynamic at which production overseas contract and emand tomarketplace. from the milk European Union, and Germany herd has begun to fall, and combined with the comerate try and getLower a read on theprices prospects for 2018. slows in response to lower prices, the a lack of alternative supply opportuniFrom an Australian perspective, it’s a mixed decision to move straight to a tender-basis for gov- in particular. utlook ties present challenges in a market with flows. 2012 milk production in the US those in south-east Asia and the Middle impact of the current financial worries case of Japan, the largest ernment buying, this should herald an eco- Inonthe consumer confidence, the pathsingle of increase maintain consistently higher 2011 forintervention the year to East limited manufacturing capacity. Despite is up around 4% on rices – bag. occurred ineconomic lactose,growth, with and SMP eventualwhilst moderation in the current spurt.

Australia’s milk production is up nearly 3 per China’s theand valuecheese also growth growth rates that support April (leap year adjusted), early nomic challenges, the underlying domes12: Sit- these of the Australian dollar. increased dairy consumption. data suggests milk production seeing signifi cant increases.

Dairy trade volumes tic market with per-cap-season, for an cent milk production continues to grow, up 1 per Howfor theisfistable, rst half ofsteady the 2017–18 reflect- EU-27US DemandAsia for have exported dairy prodever, the surge in supply has outpaced finished the March 2012 year up ending itaadairy a growing .40/kg ing to Southeast remained largely flat, as cent inquota December, 2017 with an increase moreconsumption favourableand spring than 2016 in most remains a positive and will conyear. New Zealand demand growth in the market. range population providing a degree of cer- 2.3% on the previous those to Mexico. of 1.4 per cent for the year (for a total of nearly haveucts regions, and incrementally higher milk prices.

This situation has seen the scales tinue to grow with the middle class in S. The tainty beyond the current adjustments. production is widely expected to finish Despite continued uncertainty over the future AsInenvisaged in Dairy Australia’s October Situa- 98 billion litres). The rate of growth peaked at 2.1 the seasons following the 2008 this season up 10% on last year - a huge tip in favour of buyers in dairy mar- large emerging markets such as China, et picof NAFTA, US exports continue to make up over per cent in August and has since slowed relatively tion and Outlook report, this production growth is with changes in diet and with increasing kets, with commodity prices retreatmarket influence given 95% of NZ milk financial crisis and subsequent comactors 80 per cent of Mexico’s dairy imports. The EU and consistently. by price southern, export-focused urbanisation - and also in conjunction is exported. Argentina is also enjoy- ing steadily over recent months. Butter modity recovery, farmers in regions. ent sit- driven globalare population growth.

Locally, are down somethe 30% from their ingprofi solidtabilproductionAfter growth, but a sigregionsregions have seen solidseen in the export-oriented Newwith Zealand competing for second place in wet and coldprices conditions muted recovDomestic-focused have the share, domestic market is supported by a up signifiwhilst powder prices nificantweigh supply gap Brazillast prevents supply growth (seeseasonal chart) - with market with exports from both eryinfrom year’s 2011 slowpeaks, spring, extremely dry have ityglobal and (in some areas) challenges sed on higher-cost competitors in the North- much of this additional milk from leav- lost more than 20%. Farm gate prices growing population and stable perconditions have further hit New Zealand’s milk cantly over the last five years. on output. have subsequently been reduced in capita consumption. Whilst the dairy armers ern Hemisphere amongst those expand- ing South America. trade with the Middle East production summer months.

Given the weak 2016 comparables and continumarket is currently a challenging place and North most exporting regions. The average Dairy Despite wider economic through uncer- the e form ing output as their margins increased.

Africa the major December 2017 milk were 2.5France challenges on-farm, it’s likelyconthat year-on-year to (MENA) be a seller, region all signs from indicate that bal- exporters basicintakes farm gate pricearound for milk in tainty, demand has remained resilient This season, favourable weather ntracts ing ancedepressed, will ultimately return. for same example, dropped 12% from 32 Euro importing likelower Chinathan and the ditionsrates havewill further enhanced milktheas upply. growth remains with particularly large falls in per cent month in 2016, repmoderate during second halfcountries

resenting a change from the trend which had seen butter and WMP purchases likely reflecting the year on year growth peak at just over 4 per cent impact of significantly higher dairy fat values in especially price sensitive markets. in November.

Rain in January may help arrest the decline, A large amount of milk from however there will be further impacts as a result of lower feed surpluses in spring reducing the volume the northern hemisphere EAN-Australia-New stored as silage or hay. aland FTA (AANZFTA). has yet to find a home.

Key global markets have helped absorb some “Protectionist sentiof the increases in milk production, with China nt over agricultural Amongst ods is rife and grow- the key global dairy exporters, milk and Japan seeing double digit annual percentage across production the globe, so has shown diverging trends. In Europe, increases. to provide portion pack austraLian FooD his context is pleas- have surged.

(200-330ml) configuracompany Freedom Foods Wholemilk powder and infant formula demand milkitvolumes Australia has managed tion for beverage prodGroup Ltd is to build a Growth in European milk production has have grown strongly in China, whilst increased orge an agreement new milk processing plant ucts. also been one h Malaysia that hasof the key drivers in the deterioration exports of whey powder, cream and SMP have The NSW location will to cash in on growing lowerin Asia. market lt with of some sensi- sentiment since the northern hemi- been noted. Industry commentary points to provide access to the most demand e agricultural issues The plant, to be built in sustainable and economic domestic production in China and the continued sphere autumn. effectivelyYear-on-year covered by partic- Australia, will be source of milk. Pactum has growth for the latest reported cost competitiveness of imported product,southeast NZFTA,” says Fraser. strong links to the Austrathe first Australian greenof month (November) is at 6 per cent, with the ularly from Australia and New Zealand. Imports Sealing the deal: Malaysian trade minister Mustapha Mohamed “While under the fields expansion in UHT in lian dairy industry and will liquid milk closing in oncounterpart 2 per cent forEmerson 2017, after Australian Craig signing thefrom deal. major exporters have fallen conNZFTAyear-to-date agreement totalwith expand its arrangements 10 years. of the season, with Dairy Australia’s full season forecast remaining for growth in the range of 2 to 3 per cent.

sia FTA benefits dairy Freedom

Back home, the Australian domestic market remains largely stable, with volume growth continuing in most major dairy categories. Sales value growth remains robust, with the exception of cheese where retail prices remain under pressure.

With a slower season than expected in New Zealand, reasonable import demand and northern hemisphere producers finally getting the market message, 2018 might be a better year for Australian dairy farmers than earlier feared.

However, the growth trajectory of northern hemisphere suppliers is likely to include their spring peak, which means a large amount of milk has yet to find a home, and caution remains advisable.

• John Droppert is Senior Industry Analyst with Dairy Australia

Foods plant targets Asia

ers through streamlining of rules-of-origin declaration processes and improved marketing arrangements for certain commodities.

The Malaysian market is worth about A$1 billion in Australia agricultural exports – including being its fourth-largest sugar export market and fifth-largest wheat export market.

With an annual economic growth at about 5%, Malaysia forms an important part of the ‘Asian Century’ story and the opportunity this presents for Australian agricultural producers, says Fraser.

Despite the completion of this agreement, much remains to be done for Australia’s farmers to tap into the full potential of the Asian region and beyond.

He says the NFF will now throw its attention towards ensuring agriculture remains front and centre in completed FTAs with South Korea, Japan, China and Indonesia as immediate priorities.

“These are all markets with enormous growth opportunities and where significant barriers to trade in agriculture still exist, not only through tariffs that restrict trade

but also through technical or so called ‘behind the border’ restrictions.”

The FTA was signed on May 22 in Kuala Lumpur

by Australia’s Trade and Competiveness Minister Craig Emerson and his Malaysian counterpart Mustapa Mohamed.

Emerson says Australia will be as well-positioned in the Malaysian market as Malaysia’s closest trading partners in ASEAN, and in some cases better.

The FTA will guarantee tariff-free entry for 97.6% of current goods exports from Australia once it enters into force. This will rise to 99% by 2017.

with dairy farmers for Freedom’s wholly supply of milk. The new owned subsidiary Pactum plant will increase scope Australia will run the plant. Some of its products for Australian milk supply – value-added, sustainable will be sold in Australia. and export focused.

The company says Initially the plant will given Asian consumproduce 250ml and 1L ers’ rising incomes and UHT packs from a process improving diets, demand line capable of 100 milthere will grow for quallion L. The processing www.greencon.com.au and ity dairy products from low-cost production bases packaging plant will emit All types of rural, industrial, domestic and commercial construction less carbon, use less water, such as Australia, whose and be more energy-effimilk is well regarded.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

20 // BREEDING MANAGEMENT

Selecting for heat tolerance DAIRY FARMERS can now breed for greater

heat tolerance in their herds by utilising the world-first Heat Tolerance Australian Breeding Values (ABVs).

DataGene CEO, Dr Matt Shaffer, said that although environment and management conditions had a big impact on a cow’s response to the heat, genetics also played a role.

“The Heat Tolerance ABV allows farmers to identify animals with greater ability to tolerate hot weather with less impact on production.”

To breed for improved heat tolerance, Dr Shaffer said farmers should look for bulls with a high Balanced Performance Index (BPI) and a Heat Tolerance ABV of greater than 100. He said to use a team of bulls to allow for the lower reliability.

The Heat Tolerance ABV, is expressed as a percentage with a base of 100. An animal with a Heat Tolerance ABV of 105 is 5 per cent more tolerant of hot, humid conditions than average.

Its drop in production will be 5 per cent less than the average. The Heat Tolerance ABV is favourably correlated with fertility and unfavourably with production, but natural genetic

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Its reliability is 38 per cent, which is lower than conventional production traits but in line with the newer generation of genomic-only traits.

The reliability of the Heat Tolerance ABV is 38 per cent which is in line with the newer generation of genomic-only traits. Like all new ABVs, reliability is expected to improve with time, as more data becomes available.

Heat tolerance is favourably linked with fertility and unfavourably with production. This means a strong focus on heat tolerance bulls may improve fertility but compromise production.

Ray Kitchen from Carenda Holsteins at Boyanup WA will be looking at the new Heat Tolerance ABV when making breeding decisions for his 400-cow herd.

“We will be avoiding using bulls which have low Heat Tolerance ABVs and will be looking for the bulls that pull together production and heat tolerance.”

Mr Kitchen genotypes females so has the Heat Tolerance ABV data for his herd and can see the impact some sires have had on Heat Tolerance.

“We have used bulls in the herd which clearly combine production and Heat Tolerance traits and they are the types of bulls we will be wanting to use in the future.”

While breeding gives cows a helping hand in hot weather, management will still be critical.

The Kitchen’s property at Boyanup regularly experiences summer spells when the day time temperature exceeds 38 degrees C. Carenda Holsteins is a family partnership comprising Ray Kitchen, his wife Donna, his brother Mal and his wife Lesley.

The year round calving herd is among Australia’s top 10 for genetic merit for profit as measured by the Balanced Performance Index (BPI),

DAIRY NEWS AUSTRALIA FEBRUARY 2018

BREEDING MANAGEMENT // 21

Coat colour no way to choose Holstein breeder Trevor Parrish about the new Heat Tolerance ABV, he knew he had to make sure he was breeding what his customers wanted.

Trevor runs Illawambra Holsteins in the Kangaroo Valley, NSW, selling about 30 bulls and 100 females a year to other dairy farmers.

The Illawambra herd ranked number one in Australian Holstein herds for profit (Balanced Performance I — BPI), health (Health Weighted Index — HWI) and type (Type Weighted Index — T WI) in DataGene’s August 2017 release of Australian Breeding Values (ABVs).

Illawambra genetics have sold to Queensland and the north Coast of NSW as well as locally, making heat tolerance an important consideration for some buyers.

“We have bull clients coming to us looking for BPI combined with calving ease, polledness and now heat tolerance, so we need to make sure we are breeding cattle which meet the demands of our buyers now and into the future.”

The new Heat Tolerance ABV allows farmers to breed animals with improved tolerance to hot, humid conditions.

In hot, humid weather cows eat less and spend more energy trying to regulate their body temperature. This can lead to a drop in milk production, lower milk protein and fat tests and reduced in-calf rates.

The Parrish dairy business involves Trevor, his wife Leah, their daughter Toni who has taken over the book work and son-in-law Nathan helps when not doing his electrical job.

The family milks between 160 and 240 cows year round and have had first-hand experience with the impact of high temperatures on herd production.

Mr Parrish said that while the farm had plenty of shade in the paddocks and at the dairy, production and fertility were affected by hot, humid conditions over summer.

“We experience hot summer weather in Kangaroo Valley where we don’t get a breeze, unlike dairy areas near the coast,” he said.

“We also get humidity, which decreases the cows’ ability to deal with heat.

“If we get a run of hot weather we will change our milking times around so we can get the herd back in the paddock and on the pasture before the temperatures get up.

“Irrespective of what we do on farm, there are cows that don’t eat as much when it gets hot and humid and milk production drops.”

He said making changes on farm were one part of managing heat stress, but identifying cows with a superior genetic ability to cope with hot conditions was a significant step in dealing with heat issues in the future.

“We just need to make sure we identify animals with heat tolerance that don’t sacrifice production. Those animals are out there.

“Now when I get a list of bulls I’m going to be looking for bulls which combine increased production and increased heat tolerance — they are going to be the ones who buck the trend.”

Mr Parrish’s experience has shown that cows that have positive Heat Tolerance ABVs are not necessarily light coloured or have a lot of white.

Some of the females with the highest Heat Tolerance ABVS in the Illawambra herd have

predominantly black coats.

“You wouldn’t pick their ability to handle hot weather by just looking at them, which makes an ABV for Heat Tolerance all the more important if you want to make progress,” he said.

Trevor Parrish on his Kangaroo Valley farm, NSW.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

22 // MANAGEMENT

Giant shade structure keeps cows cool STEPHEN COOKE

A TOTAL mixed ration (TMR) system implemented in the early 90s has enabled Queensland

dairy farmers David and Cindy Janke to remain profitable despite a static milk price, less rain and harsh summer temperatures.

The Jankes run 800 head and milk 400 Holsteins on Davindy Dairy at Westbrook, near

Toowoomba in Queensland’s Darling Downs.

They produce all their own silage for their ration and will start producing their own grain.

“We used to irrigate rye grass but we can’t do that now. People used to milk 30 cows back in the

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TMR and shade structure

day and could make a living,” David said.

“We’ve run pasture-based and partial mixed ration systems before but we wouldn’t go back.

TMR is the ultimate for a dryland situation.”

The centre piece of Davindy Dairy is a permanent shade structure, where the cows lie on a bed of saw dust and wood chip. It is located next to the 24 double up rapid exit herringbone dairy.

The shade structure (80m long by 14m wide by 4.5m high) was installed in 2010 and provides shade and bedding for the milking herd. The herd sits on a mixture comprising 50 per cent saw dust and 50 per cent woodchip, and when removed it makes “tremendous” compost.

“We take 2000 tonne to our block at Westbrook each year, spread it on top, and then cultivate it in for silage and corn silage.” It costs $6/t to cart the compost to their second farm and an additional $6/t to spread it.

The placement of the shade structure was important, and based on insight from their son Scott, an engineer. It was built running northsouth, with a slight tilt to the west. This ensures they receive more summer sun then winter sun, and that the sunlight reaches the ground.

If it was built running east-west, they would not have received enough sun inside which would have caused problems with moisture. The shed is open so it has good airflow, crucial in the local humidity.

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“We have the most efficient use of sunlight on the ground. It seems simple but that’s the key,” David said.

David said the right height is crucial for these structures and that if he built another, it would be slightly wider with a slightly bigger gap on top.

“The shade structure really helps our system.

It was 43 degrees in the dairy last year and we didn’t lose production.”

The herd of 380 millking cows produces 12 000 litres/day, recording 4.3 per cent fat and 3.5 per cent protein. They send about 4 million litres annually to Norco, who they joined three years ago.

They use 8000t of silage each year through a TMR system which they started in the early 90s. They produce 10 000 t of silage each year and store it in concrete bunkers.

The TMR ration consists of cereal silage (oats or wheat), legume (dollicus lab lab or soya bean) in a good season, although it has been too dry of late).

Although not the typical crop used for silage production in southern Queensland, David has had good success using forage oats to comple-

DAIRY NEWS AUSTRALIA FEBRUARY 2018

MANAGEMENT // 23

Homegrown feed.

Cows are fed with a TMR system.

Part of Davindy Holstein’s impressive calf rearing facilities.

David and Cindy Janke.

ment starch-based corn with protein.

He harvests just before seed head emergence to optimise yield and quality to come up with a pit silage product with higher metabolisable energy and crude protein values than barley, which is the predominant winter silage crop grown in the region.

They conserve summer corn for their herd’s energy requirements and oats in winter for pro-

tein in a dryland situation.

While oats are typically used for grazing or making hay in South East Queensland, and barley is the predominant winter silage option, David said oats won out in terms of crude protein content and being low in fibre content if cut before heads started to appear.

“We cut at pre-flower stage so it doesn’t go to head. It has higher protein, lower NDF and

is more digestible.”

This year they planted IT corn (Pacific Seeds 606) and Pioneer 1813 — and will compare them side by side.

Last year they grew 30t/ha of good quality oats, and aim for at least 20-25t/ha cereals. They can grow 38t/ha of corn and harvest two crops off from each paddock.

They were able to grow two crops of corn

from each paddock because of their own compost. “With compost, you only need to apply an additional 150 kg/ha of urea per crop.”

However, they rotate now because they lease more land.

The Jankes have 200ha of lease country and 60ha of their own irrigation country and they plan to grow their own grain crops with the additional land.

They currently buy their grain — 55t/month wheat; 40t/month corn; 27t/month of soya bean meal; 22t/month canola bean meal.

If their plan to grow their own grain is realised, the Jankes will have turned their impressive operation into a model of self-sufficiency.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

24 // ANIMAL HEALTH

Ensure treatment protocols meet needs of your farm IN SEASONAL calving areas, many herds have either just started or are in preparation for the autumn calving season.

Due to the nature of seasonal and split calving patterns there can be extensive time periods between treatment of animals with certain diseases and conditions.

This time lapse has the disadvantage in that veterinary drugs can become outdated and there has been a turnover of staff since the last season.

Additionally, there can be new treatments and approaches to disease that were not available the previous season.

Establishing written treatment protocols in

conjunction with your veterinarian will help ensure that sick animals are provided with appropriate and timely treatment.

This increases the chance of recovery and return to production. These protocols describe the treatments given to sick cattle for specific diseases or conditions when detection, examina-

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tion, and treatments are conducted by farm staff.

The development of specific protocols requires the support and cooperation of the farm owner, farm staff and veterinarian.

Following fixed treatment regimens can seem a challenge initially but creating plans for the most common diseases will make their management very straightforward.

Treatment protocols not only promote the judicious use of antibiotics in dairy cattle but also can improve animal welfare and reduce the risk of violative milk or meat residues.

Your prescribing veterinarian should help develop the treatment protocols specific to your farm. Every farm is different, with different diseases and different pathogens.

Farms are dynamic environments and it is important to review the treatments protocols annually to ensure that the correct, most up-todate and appropriate treatments are being followed.

Treatment protocols will fail if they are not followed or ‘procedural drift’ occurs. This happens when staff ‘adjust’ the treatment protocol without consulting their veterinarian.

If you have a treatment protocol that is not working on your farm, let your veterinarian know and discuss how it can be changed without a compromise in animal health. Ultimately, your veterinarian will want the protocols to be successful.

Written treatment protocols will only be helpful if all staff have been trained to correctly examine and identify the conditions or diseases they are being expected to treat. Training sessions at least annually with your veterinarian will provide an opportunity for existing staff to refresh their knowledge and for new staff to learn the protocols for the farm.

This is also the time for new problems and treatments to be discussed. Your veterinarian may want to evaluate how well the treatment protocols have performed.

This will rely on accurate record keeping detailing how sick animals were identified, the treatments they received and the outcome of those treatments.

A basic treatment protocol should detail: ■ The name of the prescribing vet ■ The date on which the treatment protocol was developed/reviewed ■ Who is responsible for the treatments ■ Which group of animals are being treated (medications are labelled differently for different groups eg. calves, heifers, cows) ■ What are the common signs of the disease or condition ■ What treatments should be administered (name of medication, dose, route of administration, frequency of administration) ■ What to do if there is a poor response to treatment or relapse of signs post-treatment ■ What are the milk and meat with-holding periods By following this basic treatment protocol template, farmers and veterinarians can work together to provide feasible and practical plans for the common diseases occurring on farm.

This will help improve animal welfare, save time and money and reduce the risk of antimicrobial resistance in the long-term.

• Dr Gemma Chuck is a veterinary adviser at Apiam Animal Health.

DAIRY NEWS AUSTRALIA FEBRUARY 2018

ANIMAL HEALTH // 25

Sometimes things can change ROD DYSON

“I DON’T know what it is, but something isn’t quite right!”

Tim* milks about 450 cows in a rotary dairy in North East Victoria, and it had been some years since we had worked on mastitis control with him.

“The cell count is still good, but we are now getting too many cases of clinical mastitis, and I reckon the teat ends don’t look as good as they were when you were last here.”

Tim was quite aware of the importance of good teat condition, as during our previous work with the farm, teat end condition had been one of the important risk factors we had identified and worked on (along with improving dry-off & calving management, and a few other aspects of the milking process).

Back at that time, our mastitis risk assessment of the milking process in Tim’s dairy had shown a significant level of teat end damage with 35 per cent of teat ends being classified as either “rough” or “very rough”. Rough and very rough teat ends significantly increase the risk of mastitis infections.

At that time, a small change in the operating vacuum level, plus a change to a different liner had made a huge difference to the level of teat end damage in Tim’s herd, bringing the level of

rough and very rough teat ends to below the 20 per cent threshold level recommended by Countdown.

“I’m just not happy with things at the moment, so I think you had better come back and see what is going on.”

A trip up into the beautiful valleys of North East Victoria is always a pleasure, so we gladly undertook that task.

“The cell count is still good, but we are now getting too many cases of clinical mastitis.”

Sure enough, Tim was right — we assessed teat ends in his herd to be back up to around 40 per cent rough and very rough teat ends.

“How can that be — nothing has changed!”

Our assessment of the various factors that can affect teat end condition, including measuring claw vacuum levels and pulsation whilst cows are actually milking, showed that indeed most of these factors hadn’t changed or were actually not likely to be the cause of the current problem with teat end condition.

This left us to zero in on the liners again.

How long since these liners had been changed? Have you needed to “bomb” the plant at all during their life (concentrated chemicals,

in the rubber compounds being used in their manufacture, we saw something else that might better explain the change.

Tim operates the farm with a regular replacement rate of about 25 per cent fresh heifers entering the herd each year.

This means that in the eight years since we first worked with Tim, the herd has significantly changed — few of the original cows remain in the herd, and our assessment of teats was that they are now a subtly different size and shape to what they had been.

What is clear now is that the liner Tim had been using for the last eight years no longer suited the teats of the current herd, and a change was necessary.

Just as our own feet change as we grow and age, and we change the size and type of shoes that we wear, so does a herd’s teat profile change as we breed the next generations of our cows.

A very important footnote to this story is that teat condition is not the only factor in Tim’s increased risk of mastitis — as is nearly always the case, there are a number of other factors that Tim will also be working on to regain full control of mastitis and milk quality on his farm. *Names have been changed for this story.

especially alkalis, can seriously shorten the lifespan of rubber liners)?

The liners were actually getting close to the end of their recommended lifespan of 2500 cow milkings, and Tim had already purchased the next set, so the decision was made to install the new liners, and then re-assess teat condition after 3 — 4 weeks.

Liners don’t suddenly deteriorate at 2500 cow milkings and transition from being perfectly OK one day to absolutely not OK the next day!! They start to progressively deteriorate from the time they are installed (and to a much smaller extent, even before that!), so it was possible that Tim’s current liners had already significantly deteriorated as they approached the 2500 cow milkings.

However, a month later, when we returned for a re-assessment, teat condition was no different.

Something now had to change, so we recommended changing to a different liner which we thought would suit both the dairy setup and Tim’s cows.

A further re-assessment done another month later showed a dramatic improvement — less than 10 per cent of teat ends were now classified as rough or very rough!

How could this be? Has something changed in the design or manufacture of these liners?

Whilst these liners still measure the same in the key elements of their design, and it is possible that there may have been some subtle change

• Rod Dyson is a veterinary surgeon and mastitis adviser at www.dairyfocus.com.au

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

26 // PASTURE MANAGEMENT

Brand versus variety: Finding rye-grass with best profit potential for WA farmers PETER HUTTON

WHEN YOU purchase your rye-grass seed do

you choose a branded product or a variety? Do you even know the difference? If not you are not alone. Most people assume that the label on the bag is specific to a genetically distinct plant. However, this is not necessarily the case.

Western Dairy, with the help of local seed retailers, have established the WA Seed Productivity (WASP) trials to unravel the fact from fiction about the productivity of Western Australian ryegrass pastures.

Achieving high production and consistency over multiple seasons is somewhat complicated because there are two types of rye-grass available on the market; variety and brand. A variety is a generic rye-grass with distinguishing characteristics that are retained when reproduced. A variety has the capacity to deliver consistent production across multiple generations.

On the other hand branded seeds may vary genetically and potentially be inconsistent in production across multiple generations. Branded seeds are bred from varieties that express desirable phenotypes (the interaction between the

environment and plant genotype). The term “brand name” is a distinguishing trademark for the seed but is quite often used interchangeably with “brand”, and this confuses the issue because rye-grass “varieties” and “brands” have a brand name. This means that when purchasing seed it is difficult to know whether it is a variety or a brand.

Irrespective of the brand versus variety issue, WA farmers need to be informed of the likely performance and profitability of rye-grass seed available for purchase. Pasture is the most important source of feed for Australian livestock farmers with over $100 million dollars spent each year on pasture renovation. Western Dairy sought to determine the relative milk profit potential (MPP $/ha) of a representative selection of annual ryegrass brands and varieties sold in WA. It was likely that branded rye-grasses would outperform variety rye-grasses because desirable production traits have been selected by seed companies from the rye-grass varieties.

The WASP trials, were developed by Western Dairy to provide farmers with the power to select the best rye-grass for their system. Six tetraploid annual rye-grasses (two Brands and four Varieties) were selected to determine the productive performance in a targeted region with no fertility

WA Seed Productivity trials conducted last year on a dairy support block at “Carenda Holsteins”, owned by the Kitchen family at Boyanup that was characterized by sandy soils over clay.

constraints. A rye-grass was selected from each of the major seed distributors in WA and established in plots in May 2017 using the Meat and Livestock Australia protocols for pasture trials. The rye-grass was harvested at the 2 to 2.5 leaf stage

throughout the growing season and measured for cumulative dry matter yields and quality.

The trial site was provided on a dairy support block at “Carenda Holsteins”, owned by the Kitchen family at Boyanup that was characterized

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PASTURE MANAGEMENT // 27

by sandy soils over clay.

Relative Milk Profit Potential (MPP $/ha) was calculated as a value relative to the lowest rye-grass performer of the trial using the formula: Extra milk yield (L) x estimated milk price (cents per L) — (the seed cost (the seed cost of lowest rye-grass performer)).

Extra milk yield was defined as the energy yield of the pasture less the energy yield of the lowest performing rye-grass) x Litres of milk per MJ of ME and a pasture utilization of 75 per cent. Contact peter.hutton@westerndairy.com for details.

Western Dairy, with the help of local seed retailers, have established the WA Seed Productivity (WASP) trials to unravel the fact from fiction about the productivity of Western Australian ryegrass pastures.

Rye-grass Brand 1 showed significantly higher MPP $/ha than Varieties 3 and 4 which supports our expectation (Table 1). However, the results should be considered in context of the trial conditions. A dry autumn resulted in a very slow establishment and the first harvest was subsequently late (August 22). A warm weather event

in November on the poor quality soils of the support block desiccated the plants, and the final harvest one week later was small with mostly dead plants. These conditions may have interfered with the expression of the genetic potential.

So what is the best rye-grass for WA farmers? The outcomes from this work raise some important issues. A rye-grass Brand may or may not yield higher in certain conditions and may vary over multiple seasons. A Variety is genetically more stable and reliable but does it yield as high in the short term?

What is clear is that repetition of these trials over multiple seasons and at multiple sites is crucial and will strengthen the confidence in the data that is generated.

There are three main messages to farmers that are emerging from the WASP trials; be informed using the information that is disseminated by Western Dairy; know your system including soil type and fertility and feed demand

Western Dairy research scientist Peter Hutton (right) with South West Catchment Council’s Peter Clifton at the local pasture variety trial in Boyanup, WA.

fluctuations; and ask questions when buying seed including the reliability of research that was done to generate seed recommendations.

• Peter Hutton is a research scientist with Western Dairy.

Table 1. Production and profit potential of two Brands and four Varieties of annual tetraploid ryegrass (GJ = Gigajoules; ME = Metabolisable energy; MPP $/ha = Relative Milk Profit Potential) Seed $/ha DM Yield T/ha Energy yield GJ ME MPP $/ha

Brand 1 65 6.6 7.2 244a

Brand 2 81 6.5 7.0 141ab

Variety 1 99 6.3 7.0 123ab

Variety 2 96 6.3 7.0 114ab

Variety 3 94 6.1 6.8 37b

Variety 4 100 6.1 6.7 0b

In the bottom row numbers with a different letter superscript are significantly different. In this case, Brand 1 is significantly different to Variety 3 and 4 but Brands 1 and 2 and Varieties 1 and 2 do not differ statistically.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

28 // PASTURE MANAGEMENT

Ascend replaces Winter Star II PGG WRIGHTSON Seeds have released a fastestablishing annual rye-grass called Ascend to replace their popular Winter Star II variety.

Cameron Henley, PGG Wrightson Seeds, said Ascend offers “exceptional seedling vigour and improved early winter production”. He said the the decision to replace Winter Star II with Ascend was made following extensive trials across Australia.

“Winter Star II was a market leader for many years in late maturing annual rye-grasses and was always a popular choice for farmers, providing consistent quality winter feed,” Mr Henley said.

“Farmers were telling us that Winter Star II provided them with exactly the sort of grazing and forage opportunities they were after, but if we could improve it in one way they would like it to come to its first grazing a bit quicker.”

Based on this feedback, PGG Wrightson Seeds invested significantly in researching and developing a faster-establishing annual rye-grass.

Ascend also offers farmers improved rust tolerance and excellent dry matter production from autumn to late spring. It also has finer leaves and is more densely tillered to improve its grazing performance.

“Rust is strongly associated with poor quality pasture and any pastures which are free of rust are far more usable and palatable for animals than pasture that contain rust,” Mr Henley said.

“We have also seen farmers getting one or two earlier grazings using Ascend, compared to when they were using Winter Star II and with its denser tillering Ascend fills out quickly providing exceptional ground cover.

“Ascend is suited for farmers seeking to increase their home-grown winter pasture production from autumn into late spring — whether for grazing or cutting for silage or hay.

“Ascend is able to offer multiple forage options because it establishes early but matures late in the season. You can be grazing early through the year and then cut for silage or hay late in spring.”

For more information call 1800 619 910 • Article supplied by PGG Wrightson Seeds

Ascend is a fast-estasblishing perennial ryegrass.

THUMPA RYEGRASS DELIVERS IN COLD In NSW dairy farmer Steve Skinner’s view, an ideal rye-grass starts early in the season, finishes late and provides strong growth to drive milk productivity through the winter months.

Steve runs the property ‘Wembley Park’ with his brothers Tom and Mat on the southern boundaries of Dubbo, a fourth-generation dairy operation, which is milking around 750 cows on 1600 hectares of country.

The Skinners grow pastures under centre pivot irrigators, with kikuyu the dominant species through summer, while rye-grass takes over in the colder months.

Steve has grown Thumpa tetraploid Italian rye-grass from AusWest Seeds since 2014, sowing the variety in a mix with five per cent clover to maximise productivity.

Thumpa is a fast-establishing ryegrass which is ideal for both grazing and silage production. Importantly, it also provides both early season winter growth and high quality, late season forage.

The Skinners have planted 60 hectares of Thumpa across four paddocks, with the variety the only ryegrass grown on ‘Wembley Park’.

“2017 was a very dry winter. At one stage we looked like we weren’t going to get any silage from the variety, but rain late in the season meant we were cutting

silage until Christmas time, so we still had a really good year.”

The Skinners cut 177 bales off a 12-hectare paddock in November 2017, 335 bales off a 20-hectare paddock in December, followed by a further 142 bales off another 14-hectare paddock in the same month.

For more information visit www.ausweststephenseeds.com.au • Story supplied by Stephen Pasture Seeds..

Thumpa tetraploid Italian ryegrass is a great option for pasture providing optimum feed for livestock.

THE NEW ANNUAL RYEGRASS TAKING OFF IN AUSTRALIA Ascend is the new and improved Winter Star® II replacement.

An annual tetraploid ryegrass with improved early winter production, improved rust tolerance, and all the seedling vigour, dry matter production, and late season quality you had come to expect from Winter Star® II. To discuss how Ascend can benefit your operation contact your local seed reseller, or PGG Wrightson Seeds Sales agronomist on 1800 619 910.

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Now is the time to think about autumn sown grasses.

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Key Features • Fast establishment • Excellent winter production for intensive grazing • Excellent recovery from grazing • Compatible with annual clovers to improve hay and silage quality

Available from all quality seed retailers or contact AusWest Seeds / Stephen Pasture Seeds

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

30 // PASTURE MANAGEMENT

High-yielding system despite lack of rain PAUL PRICE has been dairy farming in NorthPaul Price in his newly established Ansa Diploid perennial ryegrass stand.

ern Victoria for over 15 years.

Since kick-starting his dairy operation in 2002, prior to the drought, Mr Price has been busy craft-

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ing and refining his operation, and despite the lack of rain, he has established a high-yielding grass based pasture feed system.

This season, Mr Price has introduced Pasture

Genetics’ 24Seven Diploid Perennial Rye-grass and has been pleased with the levels of establishment and production thus far.

He has noticed the prolific tiller density that 24Seven exhibits.

Mr Price has also grown Pasture Genetics’ Ansa Diploid Perennial Rye-grass on his property for many years.

“We generally get three to four years from our perennial rye-grasses, before we have to oversow it, to thicken it up. You just have to manage it right, and not hammer it too hard,” Mr Price said.

Maintaining a purely perennial rye-grass system requires great pasture management.

Mr Price uses tools such as moisture monitors to assist him with his irrigation schedule.

The farm currently uses 9.5 megalitres of irrigation per hectare, per year, and is returning yields of around 13 tonnes of dry matter per hectare, per year. Mr Price is hoping to further improve his practices, striving to achieve a yield return of 15 tonnes of dry matter per hectare, per year.

Having upgraded his property by way of installing a comprehensive irrigation system that includes; fully-automated fast flow bay outlets, a complete farm irrigation recycle system and moisture monitoring technology, Paul has been able to save significantly on water due to increased efficiency.

“I really push my system, I have 70 hectares of irrigated pasture and I’m currently running a stocking rate of 4.5 cows per hectare,” he said.

Mr Price runs one herd and calves down in September, however, he milks all year round with carry over stock. This works to the advantage of perennial rye-grass, as it is given a rest over the winter period when demand for feed slows.

Mr Price’s rotation of 24Seven Diploid Perennial Rye-grass and Ansa Diploid Perennial Rye-grass is typically 90 days through winter, shortening up through Spring and Summer to 22 days.

24Seven Diploid Perennial Rye-grass and Ansa Diploid Perennial Rye-grass are providing him with the production and persistence required in his successful dairy operation.

A four-year-old paddock in Tatura.

(03) 5659 2314 www.notmanpasture.com.au

Ansa exhibits tiller density and fine leaf.

DAIRY NEWS AUSTRALIA FEBRUARY 2018

MACHINERY & PRODUCTS // 31

Why listen to warning signs?

FREE ADVICE is a wonderful thing. Everybody knows how to make a great ad; people who watch sports always seem to know from the couch where their team went wrong; everyone can tell you an ideal price for milk.

Some say talk is cheap, but if the case of a titbit from my brother-in-law a few months back is anything to go by, the odd piece of dispassionate advice is worth contemplating.

‘Be careful with that antique!’ he said, in reference to the Chamberlain CJD791 backhoe I ultimately purchased and reviewed some months ago.

Based on sale photos alone, his comments proved remarkably prescient.

Now let’s be clear: There were warning signs.

Plenty of warning signs. The rust, the odd tyres, the unbushed pins, the smoke (SO MUCH smoke), the claims that the owner had ‘never tried to’ shift gears, the need to jump start it every time, and, critically, the regular use of Aerostart.

Yeah, I saw the signs. But hey, I’m not some fancy pants F250 driving contractor with hire purchase agreements coming out my ears. I just wanted a cheap set of teeth to move some dirt.

Seriously, it only had to last a month, followed by a rich retirement of occasional trenching and slow, luxurious refit. Or being on-sold.

Did it? No. It did not. By the end of the first day, the side of the truck was covered in oil from the hydraulic leak that came out of nowhere on the backhoe boom.

On the second day, I travelled the length and breadth of outer eastern Melbourne securing as many drums of ISO68 hydraulic oil as I could lay my hands on, on a Sunday.

This project was going to be finished, if I had to fill the tank with my own sweat and blood. On the third day, the value of my hydraulic oil stockpile depreciated somewhat, when the ‘ever reliable’ Perkins 212 stopped turning, and refused to start again.

Having been through the electrical system (what little there is), and checked for seized ancillary components, I can only conclude the engine has seized. Cheap grunt indeed.

That was in November, and the little yellow backhoe remains perched next to the dam it was meant to dig, squarely in sight of my kitchen window.

The project itself took precedence; actual progress tempered with adjustment to the idea that I may have purchased a very expensive item of children’s play equipment.

That is, of course, unless efforts to unseize or replace the engine on a shoestring go better than anticipated.

As for the actual earthmoving, well other machines have stepped up to the challenge, and the only excavation remaining is under the Chamberlain itself.

So I will imminently be faced with the choice between pulling it out of the dam or pushing it in. Thoughts?

• John Droppert has no mechanical qualifications whatsoever, but has been passionate about tractors since before he could talk.

GRUNT

JOHN DROPPERT Having lasted a day, the Chamberlain CJD791 backhoe remains perched next to the dam it was meant to dig.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

32 // IDW MACHINERY FIELD DAYS

Tom De Greenlaw and Bastien Cocaud with a Kuhn Profile 1880 mixer wagon.

Paul Jones, Farmtech Machinery, Wodonga, reported strong inquiry for this Unia cultivator. It requires a 85-90hp tractor, and hydraulics enable it to be raised and driven on a normal road.

Tony and Leigh Byron, Valton Feeding Solutions, with a Penta Mixer Wagon that was fixed to this truck for a client.

Jason Lummis, Muddy River Ag, Echuca, with an Anderson tube wrapper, which he says saves 50 per cent on plastic wrapping.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

IDW MACHINERY FIELD DAYS // 33

Businesses at this year’s Field Days reported genuine inquiry from visiting farmers.

Mark Lewis and Donal Blackwell with the Keenan MechFibre 320 mixer wagon.

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Tim Murray, Michaels Moama, with a JCB telehandler.

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DAIRY NEWS AUSTRALIA FEBRUARY 2018

34 // MACHINERY & PRODUCTS

John Deere keeps the floods at bay THE WELL-KNOWN adage that ‘Nothing runs

like a Deere’ is being validated every day by a Northern Victorian irrigation company.

Rochester-based Campaspe Irrigation is an agent for Zimmatic by Lindsay centre pivot and linear move irrigation systems, as well as manufacturing its own transportable high capacity pumping stations built into 20ft shipping containers.

As Campaspe Irrigation’s Project Manager

Wayne Conway explained: “Our transportable pumping stations, capable of moving up to 18 Megalitres a day, are based on an idea by Geoff Mustey. A John Deere engine goes into the box, coupled to a centrifugal pump, filters, and with all the electrical gear. They’re self-contained — and people run generators off them or a large alternator off the side of the John Deere to provide 240 volt power or 415 volt 3 phase power on-site”.

“They’re popular in low flood-prone lying

areas, such as Kerang and Lake Boga, to mitigate floods or excess runoff, and at other times to shift large volumes of water between channels or dams.”

“Just half a dozen bolts and you can pick it up and move it away before the flood comes or to where it is needed.

“We’ve done these for the past four years, there are dozens out there, and John Deere is always the only engine we use. We expect con-

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The ability to purchase standard granular urea and dissolve into a liquid in cold water very quickly, can provide a major efficiency gain of nitrogen utilisation which results in an improved bottom line from day one.

The Tow and Fert is a unique machine that is ‘not just another sprayer’.

It has the ability to dissolve urea in cold water and apply it combined with growth stimulants like gibberellic acid or capital fertiliser, which results in 2 immediate savings; 1) Reduce your N input without impacting dry matter response(1) 2) Reduce number of passes across the farm by combining fertiliser products To get it on with your own Tow and Fert, call us on 1300 630 279 and we’ll hook you up.

TF

TOW AND FARM by metalform

tinued growth through 2018.

“Plus we bring in lateral irrigators from the US and we put a John Deere on them. We’d have probably a dozen of them out and about over the last 4 years. We’re currently building three of these with turbocharged 6.8 litre John Deere 6068T F150 (114 kW continuous) and 6068T F250 (124 kW continuous) on them.

“If someone comes in here wanting a diesel-driven pump with high output — it’s always a John Deere engine.”

Mr Conway said they used John Deere because they were reliable.

1) “Urease

inhibitor reduces N losses and improves plant-bioavailability of urea applied in fine particle and granular forms under field conditions”, K. Dawar et al, 2011 http://www.sciencedirect.com/science/article/pii/S0167880911002866

It’s love at fert site 1300 630 279

WWW.TOWANDFARM.COM.AU

These transportable pumping stations, capable of moving up to 18 Megalitres a day, are fuelled by a John Deere engine.

“They’re ‘specced’ very well and they’ll just sit there day after day running. We rarely have an issue with them. And farmers are familiar with them and know their qualities.”

“And we’ve had a good experience with the John Deere engine distributor Power Equipment — very good. We had tight deadlines on the three lateral moves currently being completed and it simply all happened.

“About 70 per cent of the engines we purchase would be ordered as a ‘Spec. B’ engine; we like to do our own cooling on them with our own heat exchangers where necessary.

“The drip irrigation installations run heat exchanger units — it’s preferred where the engines run for extended periods of time — they prefer to run a heat exchanger than a radiator.

“However, on all the lateral moves, if they’re out in the open and not in a pump shed they’re radiator-equipped, but if they’re in a pump shed and driving drip irrigation we always supply them with a heat exchange unit and we build all that gear here ourselves.”

Campaspe Irrigation is part of the Darling Irrigation group that operates over three states.

Darling Irrigation is itself associated with the AGnVET network with a history of agricultural service to Eastern Australia extending back over more than 100 years.

The stations are popular in low flood-prone lying areas, such as Kerang and Lake Boga, to mitigate floods or excess runoff, and at other times to shift large volumes of water between channels or dams.

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For the last five years, we have trialled GTL®60 Lucerne under the most extreme grazing conditions.

It has been grazed over 50 times in the last five years.

Order your Pasture Genetics GTL®60 Lucerne from your local rural store

GTL®60 Lucerne continues to exhibit elevated levels of residual plants and the ‘high relative feed value’ trait that Pasture Genetics’ varieties are known for.

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Our lucerne growers tell us that their key requirements for a lucerne variety are ‘productivity, persistence and quality’ – and with GTL®60 Lucerne, we can tick all those boxes. Our lucerne varieties are bred in Australia, for Australian growing conditions.

They also come with our unique Establishment Guarantee™, which reduces the risk when establishing a new stand.”

Tom Damin Research & Technical Services Manager

14-16 Hakkinen Road, Wingfield, SA 5013 • T 08 8445 1111 • F 08 8445 7777 • seed@pasturegenetics.com •

• pasturegenetics.com

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