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Record payout a boon for rural communities

SUDESH KISSUN

sudeshk@ruralnews co nz

FONTERRA’S RECORD financial results released last week will have “a significant positive impact” on regional communities, says Fonterra Co-operative Council chair John Stevenson.

During the year the co-op took important steps towards this goal, including running a robust divestment process for global Consumer and associated businesses. This resulted in an agreement to sell the businesses to Lactalis for $4.22 billion, subject to approvals.

“We’re also positioning the co-op to deliver further value through our Foodservice and

Fonterra Co-operative Council chair John Stevenson says farmers will be very pleased with the results.

STRONG PERFORMANCE

FONTERRA’S TOTAL group reported operating profit increased to $1 7 billion, up from $1 5 billion the year prior

Reported profit after tax was $1 1 billion, equivalent to earnings per share of 65 cents This was down slightly on the prior year, reflecting Fonterra’s higher tax expense in FY25 after the co-op elected not to deduct distributions to farmer shareholders from taxable income and instead attach imputation credits to dividends

The co-op delivered a return on capital of 10 9%, in line with the target range of 10-12%

“This result was driven by higher operating profit in the Ingredients business, due to demand for our protein portfolio and our use of margin hedging tools and indexed-based pricing,” says chief executive Miles Hurrell

“Foodservice sales volumes continue to grow off the back of continued demand in Greater China for our high-value products including UHT cream, butter and mozzarella

When excluding the costs associated with the Consumer divestment, Fonterra’s normalised earnings per share were 71 cents, in line with last year’s result

Dairy celebrated at the Beehive

Dairy sector celebrates at the Beehive

THERE IS nothing more important to New Zealand than agriculture, says Prime Minister Christopher Luxon.

He was speaking to 150 people at a special breakfast in the Beehive in Wellington this month to celebrate the success and importance of the dairy industry. The event was run jointly by DairyNZ and Dairy Companies Association of NZ (DCANZ) and guests included diplomats, politicians and business and industry leaders.

Luxon acknowledged the challenging trading times that farmers are going through, with a

range of geopolitical events creating uncertainty. He also noted that NZ is in recovery mode and that it’s the dairy industry and agriculture in general that’s helping to turn the economy around.

The PM praised all those in the dairy sector who get up every day and go to work and do their best to generate income.

“I want them to know that they are not villains, rather they are deeply appreciated by this government for all that they do for NZ. Our farmers are the most efficient and productive farmers in the world, and we are proud of the sector,” he says.

Luxon says he’s staggered at the amount

of ‘red tape’ that farmers must deal with and acknowledges the huge amount of stress this causes along with inflation and interest rates.

“Our aim is to create an environment that allows the dairy sector to thrive. This includes getting rid of red tape which is just simply regulation and not adding any value,” he says.

DairyNZ chair Tracy Brown says the event at parliament was to celebrate the progress the sector has made and to thank all those stakeholders who have contributed to this.

She says it’s great to see the high degree of collaboration that exists in the sector and the way

that this is benefiting farmers, the ag sector as a whole and the NZ economy.

“It was great to hear the Prime Minister talking up agriculture and the value of farming to the NZ economy,” she says.

Brown says over the last 15 years, huge progress has been made and positive actions taken to get some good environmental outcomes.

The recently appointed chair of DCANZ, Guy Roper, says as an exporting country NZ does very well. He says many parties contribute to this and the event at parliament was an opportunity to thank those who have played a part in the success of the sector.

“I think the dairy sector is well recognised for what it contributes to the NZ economy and what it does. But there is always more for us to do to develop the

understanding of the contribution that it does make,” he told Dairy News

Roper says, from a processor perspective, the innovation and products and understanding of

what customers do is so important and he believes that the science and research that goes into that just makes it a success.

When NZ needs an economic lift, dairy delivers

PETER BURKE peterb@ruralnews.co.nz

DAIRYNZ CHAIR Tracy Brown says history shows that when New Zealand needs an economic lift, dairy delivers.

Speaking at the recent celebration of the dairy industry at parliament she said there was no doubt that the present economic recovery was being driven by the dairy sector. She says the $27 billion in dairy exports is something that every farmer can be proud of. She added that the sector also had a proud history of innovation and technology.

“Our farmers have been pioneers of new technology now used across the world, from electric fences in the 1930s to rotary milksheds in the late 1960s and to today. The next generation of technology – wearables, data tools and

AI solutions – are being homegrown right here in NZ,” she says.

Brown says the history of the sector also gives us another important lesson for the future: sustainability and profitability must be considered together. She says being the biggest

part of NZ’s food and fibre sector brings great responsibility.

“We want to meet the challenge of climate change, emissions & adaptation head-on, to continue to drive improvements in water quality, and to support ecosystem health.

TRADE AGENDA A KEY PRIORITY

ENSURING THAT the dairy industry has good access to overseas markets is a key priority for DCANZ according to it new chair, Guy Roper.

Speaking to Dairy News at a recent parliamentary breakfast, Roper says as an organisation they work closely with MFAT officials to secure access and to ensure the sector is able to extract the maximum value from the various free trade agreements (FTAs) that have

been negotiated.

He says they are also looking hard at non-tariff trade barriers (NTBs) which are essentially laws and regulations that an importing country may impose. In some cases, NTBs may dilute the value of the original FTA by instituting ‘technical’ local laws that may make it difficult for exporters. A recent example of this was Canada which failed to honour legitimate ac-

When we talk about ecosystem health, we mean something simple: healthy water, healthy land & healthy animals, including thriving fish and insect life.

All those elements in harmony are good for New Zealand our farmers and our communities,” she says.

cess by our dairy companies gained through the CPTTP to its market. Only after losing several legal battles did Canada finally relent.

“We need to keep a close watch on these and really understand how many and what NTBs exist in their various forms.

“So far, we have identified 35 of these and are actively working hard with MFAT to bring these to an end,”

Brown says every new tool, technique, and innovation at the farm gate is solving today’s challenges while future-proofing tomorrow’s dairy sector. Our success is in those early mornings, the tough calls, and in farmers’ courage to try something new.

he says.

Roper says DCANZ has a really important role to play to enable processor and exporters to deliver if there is growth in the industry and also to make sure that the sector operates in a responsible way. He says one thing that is coming through right across the ag sector is that companies need scale to survive and says this is borne out by the number of mergers taking place.

Prime Minister Christopher Luxon flanked by DCANZ chair Guy Roper (left) and DairyNZ chair Tracy Brown at Parliament.

Pathways for agriculture education vital – Parker

SCIENCE IS pivotal to driving progress and unlocking opportunity and innovation in the ag sector, says DairyNZ chief executive and chair of the Agribusiness in Schools programme, Campbell Parker.

DairyNZ, along with the Ministry of Education (MoE), NZ Qualifications Authority (NZQA) and various primary industry groups have set up an academic programme in 125 secondary schools to teach agriculture, horticulture and agribusiness.

Parker, who has spent more than 30 years in the ag sector, spoke to DairyNZ in the wake of an abortive attempt recently by the MoE to remove agriculture as a standalone academic subject and drop it to a lower ‘vocational’ level. This move drew unprecedented outrage from ag teachers, industry leaders and the Agribusiness in Schools itself.

Following the backlash, Pauline Cleaver MoE’s deputy secretary, curriculum centre, issued a statement stating that agricultural and horticultural science will remain a standalone,

THE CROCODILE PIT

TO FOSTER and spark innovation in schools, what is known as the ‘crocodile pit’ is run annually.

This could loosely be compared to the TV show The Dragons Den, but it is where students are given the opportunity to come up with some unique innovations that could be applied in agriculture and pitch these to a judging panel. Campbell Parker describes it as one of the most inspiring days of the year.

“This is because you get young kids trying to come up with ideas that

Ministry-led subject for Years 12 and 13.

“Agricultural and Horticultural Science plays a key role in preparing students for careers in one of New Zealand’s most significant economic sectors. The food and fibre sector employs around 14% of the national workforce and contributes substantially to the country’s economic performance.

“I’ve also confirmed that agribusiness will remain integrated within Business Studies at Years 12 and 13. The Ministry will work closely with subject associations to ensure agribusiness is clearly visible, explicitly recognised, and valued within the subject.”

will help the sector continue to move forward. What I would say is that some of those kids are from urban families and what they get from that programme is that it ignites their passion in the sector and maybe leads them on a career path in agriculture,” he says.

The Agribusiness in Schools programme is about informing young people about the great career options in the primary sector. He says they not only have success in rural schools but also in some cities such as Auckland.

Parker says the MoE decision galvanised a lot of people to make the point that “we don’t only need vocational pathways, but we absolutely need academic pathways in agriculture”.

He says the fact that decision got overturned in a few days speaks volumes for how strong that voice was and the collective view of what the primary sector

needs. Parker says it was pleasing to see how swiftly Education Minister Erica Stanford acted to restore the programme.

Parker believes the MoE misunderstood how important it was to have agricultural subjects taught at an academic level and he says the goal is always to work with the Ministry rather than have a confrontational approach. He says industry has a part to play and making sure

that decision makers in Wellington fully understand the value of fostering agri subjects at an academic level.

“We need some of the brightest and best young people who want to go on to careers in the sector to go from secondary school through to university,” he says.

“Science has always played a big part in dairy. If you look back to 1923 when the Dairy Board was formed, farmers have invested a levy into

research and science for over 100 years. Some of those early innovations turn up in tools on a cow shed wall todayfor example, a spring rotation planner came from science,” he says. One of the critical aspects of science, says Parker, is that it provides hard evidence on which decisions can be made. He says everyone has opinions, but he says in the end, scientific evidence will win over opinions.

DairyNZ chief executive Campbell Parker says science is pivotal to driving progress and unlocking opportunity and innovation in the ag sector.

Strong pasture growth is boosting milk production

SUDESH KISSUN sudeshk@ruralnews.co.nz

FONTERRA SAYS

favourable weather conditions supporting pasture growth is boosting milk production.

Last week the co-op revised its forecast milk collections for the 2025/26 season from 1,490 million kgMS to 1,525 million kgMS.

Fonterra chief executive Miles Hurrell says favourable weather conditions experienced during the previous season are forecast to continue through spring, supporting pasture growth.

The co-op reaffirmed

the 2025/26 forecast Farmgate Milk Price of $10/kgMS with a range of $9 - $11/kgMS.

“Global Dairy Trade prices continue to be robust, as does demand from customers for our products sold off GDT.

However, the risk of potential volatility in commodity prices and exchange rates from geopolitical dynamics remains,” says Hurrell.

Fonterra’s FY26 forecast earnings from continuing operations, which

SPECIAL MEETING

FONTERRA SHAREHOLDERS will hold a special meeting on October 30 to vote on its divestment plant.

They will vote on selling the co-op’s consumer and associated businesses in Oceania and around the world to Lactalis for $4.22 billion.

The co-op is targeting a capital return of $2/share from the divestment proceeds if it progresses, which is equivalent to $3.2 billion.

Chief executive Miles Hurrell says the

excludes the businesses to be divested, is 45-65c/ share.

“Our forecast earnings for the year ahead exclude earnings from the businesses to be divested and is in line with the strong perfor-

Fonterra board intends to make a final decision on the amount and timing of the capital return once the sale agreement is unconditional, cash proceeds are received in New Zealand and having regard to other relevant factors including Fonterra’s debt and earnings outlook at the time.

The sale is subject to approval from farmer shareholders, certain regulatory approvals, and separation of the businesses from Fonterra.

mance we’ve delivered in FY25,” he says.

As well as targeting earnings to return to current levels in three years, Fonterra has confirmed it is maintaining the strategic targets and policy settings announced in September 2024, if Mainland Group is divested. This includes a target average return on capital of 10-12% from FY26,

which is above Fonterra’s 5-year average.

“We have amended our debt to EBITDA target to less than 3 times and maintained our target gearing ratio of 30-40%, reflecting an appetite to maintain conservative balance sheet settings,” he says.

While there are always risks that may impact future performance, Fon-

terra continues to target dividend payments within its policy range of 60%80% of earnings in the medium term, he says.

“Our ongoing balance sheet strength, combined with our focused strategic direction, means the co-op is well prepared for the future and positioned to continue delivering positive returns to shareholders,” says Hurrell.

FONTERRA HAS delivered a fifth straight year of record organic milk price for farmer suppliers.

Last week, the co-op confirmed a final organic milk price of $12.35/kgMS for the 2024-25 season, which ended May 31 this year. Fonterra’s highest organic milk price to date was in 2023-24 which set a record of $10.92/kgMS.

Anne Douglas, group director Farm Source, says this marks a fifth straight year of organic milk price increases, reflecting an incredibly positive demand story for the high-quality milk our farmers supply every day.

“Organic dairy sales have experienced strong growth, particularly in the US. Additional tariffs on imports into the US did present us with challenges in FY25, however, these were largely able to be passed through to our customers due to the firm demand,” Douglas told Dairy News.

“Favourable market conditions saw our FY25 organic sales increase 27% year on year, while the co-op’s organic milk collections were also up 7.5% to 9.7 million kgMS.”

The co-op’s organics business has been running since 2002 and continues to grow in supply, product range and value.

Over the last 4-5 years, the programme has more than doubled in size and currently includes more than 100 farms.

Today, the business is in a strong position, says Fonterra, as it makes the most of market conditions, including growing consumer demand as well as supply constraints globally.

Organic farmers earn a premium, and there’s also a benefit to all Fonterra farmers because around 20% of the programme’s revenue goes back to the co-op as a contribution to shared overheads and earnings.

– Sudesh Kissun

Fonterra says good pasture growing conditions are boosting milk production.

Should co-op sell its consumer brands?

MURRAY GOUGH

AS CEO of the Dairy Board in the 1980s I was fortunate to work with a team of experienced and capable executives who made most of the brand investments that created the international consumer business Fonterra inherited.

Soprole in Chile was the largest, but there were more than 20 countries where consumer marketing companies were established and Anchor and other brands were successfully launched.

The prime motivation at the time for those investments was not, as many today think, profit and added value. It was to create more secure outlets for New Zealand’s milk – those were the days of butter mountains and dumping and loss of the UK market. New

outlets had to be found quickly, and branded consumer products were a much more reliable ongoing sales opportunity than commodity tenders in places like Algeria and Venezuela. The brand businesses needed to operate profitably, but the benchmark was the return from selling the same amount of milksolids into crowded – and at times barely existent – bulk markets.

It was always envisaged that the brand businesses would in time become increasingly valuable, but for many years it was their value as a secure outlet for milk that mattered most. Fortunately for New Zealand the GATT Uruguay Round put a stop to European and American surplus mountains and dumping, and in the course of the 1990s and since, world demand for dairy

products has steadily grown. World prices have increased to reflect the true cost of production – and production cost is where New Zealand has an ongoing advantage.

The need to own consumer businesses to move our milk no longer exists. There is no difficulty now in selling all we can produce at good prices. And there are also many opportunities to add value in food service and specialised ingredient products.

The only justification for Fonterra to continue to own and invest in consumer brands is if it can achieve an attractive return on the capital invested. And sadly, that is not the case. Fonterra was formed more than 20 years ago and over that time it has struggled to achieve an acceptable return on capital in its consumer businesses. Some decisions such as

the investments in China have resulted in very substantial losses.

There are clear reasons why Fonterra has found it too difficult:

Standard high volume food products such as butter and cheese and milk powder are intensely competitive and don’t offer significant brand margins. In most countries the market is dominated by two or three large and very capably managed brands whose owners work extremely hard to ensure other suppliers struggle to survive.

Every one of the world’s major dairy brand marketers has a huge domestic market in which to develop and test products and management expertise. New Zealand’s domestic market is simply too small to do that.

Fonterra would need to be able to

recruit highly capable and experienced international brand marketing executives, and have a board of directors experienced in governing a global consumer business; neither has been or is likely to be available in New Zealand. We are too remote and our domestic market is too small. New Zealand has had some international business successes, particularly where technology is a

‘A SHAMELESS POLITICAL STUNT’

NIGEL MALTHUS

A SHAMELESS political stunt is how Federated Farmers is describing the Canterbury Regional Council decision to declare “a nitrate emergency” on the back of its latest annual groundwater quality survey.

Federated Farmers vice president Colin Hurst says ECan’s decision won’t help anyone.

“It’s incredibly disappointing to see Environment Canterbury (ECan) playing these kinds of petty political games,” he said in a statement.

“Declaring a nitrate emergency isn’t helpful or constructive. All it will

do is create unnecessary panic and drive a wedge between our urban and rural communities.

Federated Farmers’ national dairy chair, Karl Dean, a Canterbury dairy farmer, noted that while the latest figures show 62% of wells getting worse, the figure from the equivalent study three years ago was 75%.

“So, the question is, why wasn’t there an emergency declared then, as opposed to now? That’s where it just comes down to this political grandstanding, and the council should have rejected it. It’s absolutely atrocious,” he told Dairy News

The outgoing council made the declaration at its last meeting

before breaking up for the local body elections.

The motion, from Cr Vicky Southworth, called for the next council to make more rapid progress on nitrate reduction in groundwater, including options to put more of the costs of removing nitrate from drinking water onto nitrate polluters. It passed nine votes to seven.

Asked what practical difference the declaration would make, Southworth told Dairy News that she proposed the motion as a way of raising the profile of the issue and creating a focus for the next council to keep it in the forefront of their minds.

factor (such as Fisher and Paykel Healthcare), but we have very limited experience in managing business networks beyond our border.

Fonterra’s decision to sell has been based on what it thinks is best for its shareholders –and the absolute priority for them is the highest achievable return for their milk. It could only sensibly continue to own a branded consumer business if it expected to

Southworth said farmers seemed to begin to acknowledge the need for good management practises about 10 years ago.

“Now we’re 10 years in and we’re seeing 62% of the wells across Canterbury still on an increasing nitrate trend.

“I absolutely, fully know that there are people doing good stuff. Some more than others. But the trend is still going in the wrong way on a lot of wells.”

While Southworth is not herself standing for re-election, Dean still believed it was political grandstanding on behalf of the mainly urban councillors who voted for it.

•Ideal for Cattle Troughs

•High Flow

•Side/Bottom Mount

•Detach to Clean

•Compact/Robust

•Ideal for Small/Low Demand Troughs •Low Flow

•Above/Below Water Mount •Built in Check-Valve

earn a sound return on the capital invested – and that isn’t the case.

After many years of trying, it should surprise no one that Fonterra has decided to sell, and to focus its energy on opportunities where New Zealand does have the skills and experience to expect to manage successfully.

• Murray Gough was the chief executive of the New Zealand Dairy Board from 1985 to 1992

“The emergency gives them something to vote on, or for their fellow potential councillors to campaign on,” he says.

Dean also questioned how much practical difference the declaration would make.

He said that while it would give council staff some instructions on what to do, it looked very much like business as usual, with tasks that they should already be doing.

Nitrates were known to be an issue since the 1960s when the first nitrates research was conducted at Lincoln, he said. Farmers knew there was a problem but it was a “long road” to effect change.

•Ideal for Compartment Troughs/Tanks

•High Flow

•Top Mount

•Detach to Clean •Compact/Robust

Former Dairy Board CEO Murray Gough believes the need for Fonterra to own consumer businesses to move its milk no longer exists.

High payout, low interest rates help offset soaring farm costs

price payout forecasts continuing to offset ongoing high farm costs, according to DairyNZ.

THE DAIRY sector is in a relatively stable position, with strong milk

In DairyNZ’s latest Econ Tracker update, the breakeven milk price

(BEMP) has been revised to $8.66/kgMS, up slightly from last season’s $8.45, but little change from DairyNZ’s June forecast.

The predicted average payout also remains

steady at $10.30/kgMS.

The breakeven milk price is the milk sale price per kgMS to cover a farm’s costs in a season, excluding capital expenditure and

principal repaid on loans. The forecast average payout is based on the estimated milk receipts for the specified season, along with dairy company dividends.

DairyNZ head of economics, Mark Storey, says the update reinforces the fact that current market fundamentals remain stable.

“Costs continue to remain elevated, but with high expected milk price payouts, the revenue outlook is still relatively strong, which is helping counterbalance cost pressures,” says Storey.

“There continues to be uncertainties in the wider economy and the international geopolitical environment, but overall, the dairy sector is in a good position.”

Farm working expenses have edged up slightly to $5.91/kgMS, reflecting ongoing cost pressures.

StatsNZ’s Farm Expense Price Index shows electricity prices are up 12% and freight costs are up 10% compared to last year, while fertiliser and feed costs are still elevated, with no relief expected in the near term.

However, Storey says easing interest rates are helping farmers manage these increases.

“Falling interest rates are offsetting some of the extra costs and helping to keep breakeven milk prices stable. Looking ahead, further OCR

reductions are forecast, which should ease debt servicing pressures, although this also points to a broader economic slowdown.”

According to Rabobank’s Q3 global dairy quarterly report, New Zealand dairy farmer revenues remain strong. Report co-author RaboResearch senior analyst Emma Higgins says Fonterra has maintained its milk price forecast of $10/kgMS for the 2025/26 season and raised its forecast for 2024/25 to $10.15/kgMS.

She says strong beef prices are also supporting dairy farm incomes, with additional revenue from cull cows providing the income boost.

While revenues are up, Higgins points out that so too are costs.

“Feed prices are rising across most inputs, but they remain affordable, and strong early season milk flows point to a bumper production season.

“If conditions continue to align, New Zealand dairy farmers could be on track to set a new production record –building on a strong 2024/25 season, which ended 2.6% YOY higher in tonnage and 3.3% YOY higher in milksolids.”

DairyNZ head of economics, Mark Storey, says current market fundamentals remain stable.

A broad approach to environment

AS AN on-farm judge for the Ballance Farm Environment Awards for many years, I’ve witnessed first-hand how dramatically New Zealand agriculture and horticulture has transformed over the past three decades.

While farmers and growers have always inherently had an intergenerational view of their land, some sustainable farm practices that were once considered a little bit fringe have become part of mainstream farming and simply what’s done.

As we enter into another round of applications for next year’s Ballance Farm Environment Awards, here are some key trends

I’ve observed around the wider shift toward a more holistic environmental guardianship approach to farming and growing.

Transforming marginal land to support whole farm system ecology

Looking back, decades ago the effective area of a farm referred almost entirely to the grazable or plantable land of a farm, with other zones often deemed as unproductive or even wasteland.

Today, farmers and growers recognise that these areas like riparian strips, wetlands and native bush remnants have a big role to play in the overall ecology of a farm and the work environment for family and staff.

These areas support biodiversity, reduce emissions, stabilise soils and contribute to water purification. Every year

I see how well entrants demonstrate that even marginal land can add huge value to a farm system. A common observation is the improved aesthetics and work environment these wetland or riparian areas provide.

Biodiversity and eDNA monitoring as a new frontier

Farmers are also beginning to look beyond riparian plantings; they’re now monitoring what lives in the water itself.

The introduction of eDNA testing to assess aquatic biodiversity is a growing trend, and early adopters use it to track things like fish and invertebrate presence as well as help guide restoration decisions. The species they discover living in waterways on farms and orchards can be very surprising.

Health and safety

In the past we’d walk onto a farm and see riders on quad bikes only occasionally wearing helmets. Now wearing helmets is standard practice and many farms have transitioned entirely to enclosed side-byside vehicles to improve safety. This, alongside a focus on mental health and staff wellbeing, shows the culture shift reflecting a wider commitment to health and safety.

Precision farming shifts from whole farm to paddock level

Thirty years ago, fertiliser and irrigation management was managed at the whole farm level. In the early 2000s this progressed to block level planning and nutrient budgets. Now, early adopters are applying variable

rate technology within paddocks, adjusting inputs based on soil type or moisture. This type of precision fosters efficiency and reduces waste, supporting better productivity and a lower environmental footprint.

Harnessing technology to support better environmental outcomes

Growers like Healthy and Fresh in Karaka, which won the Auckland Regional Supreme Award at the 2025 Ballance Farm Environment Awards this year are using hydroponic systems to dramatically reduce water and nutrient usage. While 2024 Otago regional award winner Forest Lodge Cherry Orchard runs its entire operation entirely on solar energy, from tractors to frost fans.

These examples show what can be done to

drive both sustainable and profitable ways of operating.

• Warwick Catto is a board member of the New Zealand Farm Environment Trust and has been an on-farm judge of the Ballance Farm Environment Awards for more than 15 years.

Warwick is also the Science Strategy Manager at Ballance Agri-Nutrients. Entries are now open for the 2026 Ballance Farm Environment Awards, for more information, visit bfea.org.nz

Entries close 31 October 2025.

WARWICK CATTO

Warwick Catto, Science Strategy Manager at Ballance Agri-Nutrients.

ECan in circus mode

THE FIRST question is how much nitrate is there in the Canterbury water and are we expecting multiple deaths with hospitals overwhelmed every day? Unlikely.

The second question: is there some variety of idiot juice in the water in the region? Absolutely. Proof is the bizarre declaration by Environment Canterbury that there is a ‘nitrate emergency’ in the region. So why haven’ t the police, the health department, the army and even experts from the White House been called to deal with it? Because no one, not even the latter, could believe such a ridiculous claim. This nutterdriven, half-baked attack on the dairy industry is beyond crazy scaremongering and a good reason why the Government should think seriously about abolishing regional councils.

If councils waste time and money financing an electoral stunt by the watermelon party (AKA the Greens) do they have the right to collect money from sensible, financially hardpressed residents? No, they should go. And per the prophetic words of Gilbert and Sullivan, ‘they never will be missed’.

Teaching educators

IT’S HARD to comprehend the ignorance and stupidity of the so-called leaders in the Ministry of Education who for some incomprehensible reason seemed hell bent on perpetuating the myth that agriculture is just for ‘dummies’.

Their unilateral decision, based on their own enclosed Wellington view of the world, to abolish the academic science subjects of agriculture and horticulture must rank as one of the dumbest ideas ever made in the ag sector in at least the last 70 years. Yes, there is an important place for vocational training, but have these so-called educators never heard governments of all colours point to the need for NZ to get the brightest and best people into highly skilled well-paid jobs in agriculture and horticulture. There needs to be an education programme run for the educators about the technology which drives our primary sector.

MSA triumph

METHANE SCIENCE Accord, a farmer-led organisation advocating for zero tax on ruminant methane, will be quietly celebrating its first foray into fertiliser co-operative governance.

In a something of a shock result, outspoken Otago sheep farmer Jane Smith topped a three-way battle for Ravensdown’s South Island board seat, beating sitting director Nicky Hyslop and agribusiness leader Rebecca Keoghan. Smith received over 36 million weighted votes, compared to 21m for Hyslop and nearly 5m for Keoghan.

The result will be a morale booster for MSA and shows that farmer support for their cause is strong. Buoyed by the result, MSA may be eying seats on Beef + Lamb NZ and other farmer-based organisations.

Tough times

DAIRY INDUSTRY players are also falling by the wayside as the economic downturn bites around the country.

Last month award-winning cheese company Cranky Goat went into voluntary liquidation.

This month, Christchurchbased milk powder manufacturer Wimpex followed suit. Started almost 18 years ago, Wimpex was hit hard by the downturn in Asian markets after the Covid-19 pandemic. The company owes almost $6m to unsecured creditors and over $2m to IRD.

Bigger players are also not immune to the downturn. Māori-owned Miraka Milk was in financial doldrums before being bought out by Open Country Dairy.

EDITORIAL

Nitrate emergency?

ENVIRONMENT

CANTERBURY’S (ECan) decision recently to declare a so-called “nitrate emergency” is laughable.

Coming weeks before the local government elections, farmers are rightly calling it an election stunt. Federated Farmers goes further and claims that some ECan councillors clearly see this as an opportunity to score cheap political points and push an anti-farming agenda.

What happens in a nitrate emergency?

According to ECan’s website, as a result of this vote (7 to 5 in favour), staff will bring a workshop to the next term of council “to outline the scale, causes, spatial distribution, latest lag time research, and current and predicted impacts of nitrate pollution in Canterbury to enable a well-informed discussion and development of key steps we can take to make more rapid progress on nitrate reduction in groundwater”.

“Staff will also prepare advice for council about the cost for drinking water suppliers and private well owners of treating nitrateenriched groundwater or finding low-nitrate water sources, and how these costs could be distributed”.

In other words, more financial burden for regional farmers and the risk of undermining the good work they’ve been doing with councils, iwi and the wider community over the last few decades.

Farmers aren’t disputing that Canterbury has an issue with nitrates. It’s a longstanding challenge that farmers and the community have been working on.

But to suddenly come out and call it an ‘emergency’ raises eyebrows. Why didn’t ECan declare a nitrate emergency at the beginning of their term and take steps over the past three years?

Passing a nitrate emergency at their last council meeting before the election certainly looks like a political stunt.

One farmer hit the nail on the head on Facebook saying, “there was an ‘oxygen emergency’ at the council table when they passed this gem”.

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Working with farmers to ensure best outcomes

RECENT MEDIA commentary from Southland Federated Farmers has raised concerns among our rural communities, particularly around Environment Southland’s approach to winter grazing inspections and nitrogen reporting. But let’s be clear, much of what’s been said simply doesn’t reflect reality.

At the heart of the issue is a claim that farmers are being invoiced for inspections even when no problems are found. That’s not just misleading, it’s wrong. Environment Southland only issues cost recovery invoices when there’s a confirmed breach of the rules. This isn’t about penalising farmers for doing the right thing, it’s about ensuring that the cost of investigating and enforcing noncompliance doesn’t fall unfairly on all ratepayers.

This winter alone, 76 intensive winter grazing sites were flagged for follow-up. Of those, only 21 resulted in cost recovery invoices and each tied directly to confirmed noncompliance. The rest have had an array of approaches from advisory letters, ongoing investigations, to no further action being needed.

There is also still 26 investigations to complete.

Our enforcement approach has remained the same for several years and is education-first, if appropriate.

Officers look at compliance history, engagement with Environment

Southland staff and environmental effects of any identified noncompliance, and case-by-case, determine next steps.

Let’s not lose sight of the bigger picture. Farmers who hold winter grazing consents receive one inspection per year, and they pay based on actual costs (time/ kilometres). They then receive an invoice for annual charges, the same as other consent holders. That’s standard practice, not targeted enforcement.

matters. Farmers deserve to know what’s at stake if issues persist.

There’s also been confusion around communication. Contrary to what’s been implied, farmers are always contacted if non-compliance is found. Staff discuss the inspection outcome directly, including any cost recovery. The invoice itself includes information about potential future penalties, not because they’re being applied now, but because transparency

On the nitrogen reporting front, Southland farmers have shown strong engagement with this national requirement. With 85% fully compliant and six farmers exceeding limits, the region is clearly committed to responsible nutrient management. Where limits were breached, Environment Southland took an education-first approach, working with farmers to improve understanding, not rushing to enforcement.

Yes, there were 20 farmers who received non-supply fees after

repeated reminders. But even then, many responded quickly, and those who’ve now submitted their data may be eligible for remittance. Again, this isn’t about revenue, it’s about fairness and accountability.

In a time when trust and collaboration are more important than ever, it’s disappointing to see misinformation muddy the waters. Southland farmers deserve facts, not fear.

Overall, 41 cost recovery and non-supply fees have been issued. When balanced against the number of farmers in the region, it seems clear that this is not the overzealous

penalisation that is being painted. We’ve seen a lot of positive change in winter grazing practices in the region in recent years. This is reflected in what Environment Southland staff are seeing on the ground, with most farmers doing the right thing.

Our staff are here to help farmers navigate their environmental responsibilities. We want to work with farmers to ensure that the best outcomes are achieved through the regulatory framework.

• Nicol Horrell is chairman of Environment Southland

NICOL HORRELL Environment Southland chair Nicol Horrell

Better electricity generation, storage and trade on

TO ANSWER these questions, we used energy data from the farm, along with models of solar power, wind power, load management and battery storage to create an energy simulation. We also included costs and different electricity pricing structures.

An important concept when considering renewable energy is to, whenever possible, align

installation of a 126kW (kilowatt, a measure of electric power) solar array resulted in an annual electricity cost saving of $26,000. Furthermore, when the sun is shining and demand is low, extra electricity is sold back to the grid.

On most dairy farms, highest electricity demands occur in the morning and afternoon milkings. To suit this

shifting activities like water heating to midday, and energy storage, where batteries store excess power for later use.

You’ll save the most money when your solar is covering your own daytime loads – things like water heating, milk chilling, and effluent pumping.

Wind generation New Zealand is a windy

On most dairy farms, the highest electricity demands occur in the morning and afternoon milkings.

KEY POINTS

The dairy farm we focused on is in Matamata, with 600 cows and a 54-bale rotary shed. Our client wanted to investigate on-farm electricity generation, storage, and usage. Rooftop solar was installed in in 2024 and the farm changed from gas to electric hot water heating in 2025. We wanted to answer:

■ 1. What orientation and arrangement of solar panels will best match the timing of dairy farm electricity demand?

■ 2. Should the case study farmer install a wind turbine to complement their solar system?

■ 3. How can farmers change when they use power to match the cheapest electricity?

■ 4. Under what circumstances is on-farm energy storage, such as batteries, financially viable?

CONCLUSION

Any investment in on-farm renewable energy is a long-term investment. If a system is designed around a large net export of energy to the grid, it is important to understand that it is difficult to predict the electricity pricing plan over the lifetime of the asset. Designing a smaller system and targeting higher self-consumption means that the farm will be more

from the grid. This makes the return on investment less susceptible to a changing energy

Preparing for maize planting

WITH SPRING underway, maize growers across New Zealand are preparing for planting.

Understanding how to set up your crop for success is critical, and Pioneer’s national research & agronomy manager, Dr Rowland Tsimba, says it all begins with knowing your growing environment. Rowland recently joined Matt Dalley and me on our “Feed for Thought” podcast to unpack the science behind growing a highyielding maize crop.

“The key to cropping success is a combination of understanding the science and good strategic planning,” says Rowland.

“While factors like temperature, radiation levels, soil type, and moisture availability are largely beyond a grower’s control, understanding them allows for better management decisions that can mitigate their impact on yield”.

Soil testing is one of the first critical factors to consider in the planning process. Maintaining the correct soil pH (ideally around 6.0 for maize) ensures nutrient availability and prevents potential toxicity issues from micronutrients like aluminium and iron. Beyond pH, understanding your soil’s nutrient profile helps determine fertiliser requirements based on realistic yield targets for your specific environment.

Hybrid selection is important, and growers should consider a range of factors, including the crops’ end use, key agronomic traits, and paddock yield potential. Always choose hybrids that have been tested across a range of growing environments over several seasons.

Plant population represents another crucial planning factor. Modern maize hybrids have improved stress tolerance ratings, allowing for higher plant densities in suitable environments.

Rowland points out, “Provided water is not limiting, yield is largely determined by the amount of radiation that the crop can intercept”.

The higher the number of plants, the greater the potential for light interception; however, the population must be matched to the growing environment. This is why we typically reduce plant numbers in moisturelimited areas or for late plantings. A simple visual assessment conducted after maximum leaf size has been achieved (about

a week or so after silking) can help determine if you’ve chosen the right population. This can be done by estimating the amount of light penetrating the leaf canopy onto the soil on a sunny day around midday. Ideally, light penetration below the leaf canopy should not exceed 5% of the soil surface area below the canopy.

Timing of planting is essential for crop success. It is recommended that the soil temperature at planting depth should be 10-12°C and rising (measured just after sunrise). Soil cultivation can influence temperature, with conventional tillage or strip-till warming soils faster than no-till systems. Moisture levels at planting are critical too; soil that can be moulded into a non-breaking ribbon is too wet and should be given more time to dry. When planting into dry conditions, increasing seed depth (up to 7.5 centimetres) to reach moisture can promote uniform emergence, which is essential for maximising yield potential.

Post-emergence management includes monitoring crops at the V2-V3 growth stages (when plants have two to three fully expanded leaves) for potential pest issues or weed competition. This early vegetative stage represents a vulnerable period when

FIRST YOUNG HF SIRE SET

THE INAUGURAL intake of the Holstein Innovation programme has produced its first young sire set to make an impact on the Holstein Friesian breed in New Zealand.

Kaahu Wimbledon Halo, bred by Mark and Suzy Riddington (Black & White 2010 Ltd), is out of Paragon Portion Honey ET, purchased by the Riddingtons at the Canterbury Collection Sale.

Holstein Innovation Chair Doug Courtman says Halo’s dam hails from a world-renowned cow family, developed in New Zealand by Rikus Scheepers.

“Paragon Portion Honey ET is a granddaughter of AOT Modesty Hoss ET, who was herself a granddaughter of Cookiecutter Mom Halo ET,” he says.

plants haven’t yet developed sufficient leaf area for vigorous photosynthesis. Understanding the V-stages is more reliable than using plant height alone for timing management decisions, particularly herbicide applications, that need

to be completed before tassel initiation around V5-V6.

Successful maize crop production hinges on understanding the environment and using this information to inform decisions around nutrient application, hybrid

choice, plant population and planting conditions. This should be followed up with crop monitoring and an appropriate weed and pest management plan.

To hear more on this topic, check out our latest Feed for Thought podcast

Take control of your mating season.

with Rowland Tsimba, available on the Pioneer website and all major streaming platforms. • Wade Bell is Genetic Technologies farm systems manager. Contact him at wbell@genetic.co.nz

“This family is celebrated as one of the most prepotent worldwide. Popular sires such as Mr Ernest Anthony Havenofear and Ducket PFCT Has It All are just two examples from this line making their mark in New Zealand.”

Backed by proven sires Wimbledon, Portion and Mookie, Halo is well placed to suit a range of New Zealand breeding programmes.

Holstein Innovation is a joint sire proving scheme between HFNZ and LIC, designed to select and prove Holstein Friesian bulls for New Zealand dairy farmers. Genomic screening identifies elite young bulls for artificial breeding, while giving LIC access to diverse cow families within Holstein Friesian NZ member herds.

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Talk to your local vet about boosting your productivity and profitability.

Hybrid selection is important when planting maize.

Flexible milking for uni farm

NIGEL MALTHUS

AN EARLY adopter of a 10-in-7 variable milking regime, the Lincoln University Demonstration Dairy Farm (LUDF) is tweaking the system this season in search of further boosting farm performance and profitability.

Partnership &

demonstration lead

Antoinette Archer says the farm is adopting a “tactical milking” system that considers individual cow needs and can flex to seasonal and management triggers.

LUDF’s involvement in monitoring programs, comparing data from wearables and productivity, has aided researchers in providing

farmers with more informed guidelines at an individual cow level, she said.

The farm will initially milk transition cows (post calving) once-aday (OAD), monitoring rumination as a predictor of post-calving recovery.

When transition cows meet rumination criteria they will shift to twicea-day (TAD) milking

to support peak milk production.

Archer said that Increasing milking frequency early in the season drives milk production and pasture demand at a time where pasture growth is at its maximum.

“The goal is to ensure we harvest as much pasture as possible, which sets the farm up for an

WHAT IS MILK FEVER COSTING YOUR FARM?

Animate: the palatable solution for transition cows.

increased feed conversion efficiency, which will improve the farms outcomes for efficient and profitable milk production.”

“The goal is to ensure we harvest as much pasture as possible, which sets the farm up for an increased feed conversion efficiency.”

LUDF will maintain milking frequency flexibility by moving to a 3-in-2 or 10-in-7 milking regime, post mating, depending on the animal and people conditions during the season. For the animals, the triggers to adjust milking frequency will include body condition score, and weather conditions, including heat or prolonged wet periods.

Archer said the “people triggers” would consider staff needs and distribution of workload.

“These triggers offer flexible management levers to optimise milk production, animal health, and environmental outcomes, while looking after our people.

“The rationale behind this approach is rooted in generating more profitable and environmentally friendly milk, with a focus on reducing greenhouse gas intensity - measured through FPCM –and supporting feed management during peak growth.

“This strategic shift aims to provide resilience against seasonal challenges, support animal performance,

and help meet our environmental targets and commitments.”

LUDF will also return to a two-herd system, which will enable targeted care of animals with divergent requirements and give management additional flexibility ensure our reproductive performance and animal welfare targets are achieved.

2021-22 was the first full season of ten-inseven variable milking on the farm, milking twice a day three days a week but only once a day otherwise. Small losses in production were expected to be offset by various gains including energy and labour costs, while bringing significant gains in staff and herd welfare. At that time, they expected a 6% drop in production due to the variable milking regime. Archer said that the actual recorded drop averaged 8.4%, but that was across a period with three unusually wet seasons when even farms continuing conventional twice a day milking also suffered production decline. Benchmarking against a sample of those farms showed they recorded drops of 3.2% - suggesting LUDF’s weather adjusted production drop was only 5.2%.

Archer said the South Island Dairying Demonstration Centre (SIDDC), the partnership that runs the farm, will elaborate on the changes at an upcoming Focus Day on October 8. The focus day will also hear insights from an Emissions and Profitability Project that has been running in conjunction with Fonterra, DairyNZ and LIC.

Transitioning cows showing the wearable collars which will help the farm manage a new “tactical milking” regime this season.

Quad safety promoted as part of the product

MARK DANIEL markd@ruralnews.co.nz

IT’S HARD to believe that quad bikes or ATVs have been around for about 50 years – even longer if you add in the balloon-tyred trikes that first appeared in the Bond movie Moonraker.

Thankfully, those trikes were only sold for a short time, due to wellfounded safety concerns.

Despite their popularity and usefulness, quads have developed something of an unfortunate reputation on the safety front, being involved in many on-farm fatalities.

Most fatalities involving quads are because of head injuries or chest injuries caused by crushing during an accident. Head protection is vital, but avoiding circumstances that result in an accident in the first place can also be a lifesaver. It is worth noting that utility terrain vehicles (UTVs) are not immune to head injuries, as head clashes, between passenger and driver or with the safety belt mount, can also happen on rough terrain or rollovers.

To their credit, manufacturers and distributors in the UK are aware of this, so are doing what they can to reduce the risk

to operators, focusing on the fact that the key to safety lies in proper training. They are keen to get all customers and present owners up-todate on their correct operation of their vehicles.

EASI, the European All-Terrain Vehicle Safety Institute, is a not-forprofit organisation in the UK, sponsored jointly by CanAm, CFMOTO, Honda, Kawasaki, Kymco, Polaris, Suzuki and Yamaha to deliver a programme of specialist ATV & side-by-side operator training courses, designed to improve operator skills, safety levels and awareness of the vehicle’s capabilities.

Buyers who purchase new or used ATVs & sideby-sides from one of these manufacturers via an authorised UK dealer are eligible for free or highly subsidised EASI Operator training course, subject to qualifying terms, conditions and availability.

A typical programme lasts for around four and a half hours and addresses points such as protective clothing and equipment and preride inspections of ATVs. Further, it includes controls, starting the engine, starting out, shifting gears, braking and turning. Addressing riding strategies and risk awareness, as proficiency

increases, the training looks at quicker turns, quick stops and swerves, stopping quickly in a turn, riding over obstacles, U-turns and traversing or climbing or descending hillsides.

New McHale terra drive axle option

MARK DANIEL markd@ruralnews.co.nz

WELL-KNOWN FOR its Fusion baler wrapper combination, Irish manufacturer McHale has launched an interesting option at the recent Irish Ploughing Match.

The Terra Drive driven axle, shown on a Fusion 4 baler, has been in development for over two years, because of demand from users who work on sloping or hilly terrain.

While driven axles are nothing new (think of ground wheel drives often found on lime spreaders of the 1970s and ‘80s), it‘s not simply a case of bolting the axle on and plugging

it into the rear of the tractor; special consideration needs to be given to overall control.

The drive units being used are made by the Finnish company Black Briun, who are known for equipping logging trailers with powered axles, used extensively throughout the Nordic countries.

The twin stub axle units are fed by the same hydraulic feed that operates the baler functions and can be operated in three different modes, controlled by ISOBUS and tractor implement interface TIM.

One mode allows the driver to engage the axle drive via the ISOBUS screen, although this manual control is supplemented by two further cues from

the tractor. When encountering a slope and detecting that the tractor is having to increase RPM, the system cuts in, while another is the system sensing that tractor wheel slip is exceeding a pre-set threshold, allowing oil flow to be directed to the drive units. For safety purposes, the system cuts out altogether when forward speed exceeds 12km/h, such as when returning to the road for transport. In addition to the drive units, McHale has increased the tyre size options available on the Fusion 4 baler to include 710/25 section Vredestein items. The company designed a specific tread pattern for hilly regions and soft soil conditions, which have become extremely popular with operators over standard fitments.

FEATURES:

 High spindle speeds result in more cuts per forward metre of travel

 Stand on belt covers for easy access to rear of tractor

 Auto belt tensioners provide better drive to spindles in long grass

Given that we are required to have a licence to drive a vehicle on public roads, surely it’s about time that compulsory basic training should be a pre-requisite for operating ATVs or side-by-sides, because as an industry we must be proactive in reducing the ongoing toll on rural families.