Fonterra farmers feel let down by proposed DIRA changes Page 4
the missing link
Doug Edmeades slams science funding Page 8
get a handle on nutrients Overseer upgrade Page 10
february 14, 2012 Issue 262 // www.dairynews.co.nz
milk price war? “Supermarkets are making 30% profit on milk – highly unusual for a fast moving product.” – Clinton Beuvink, Nosh PAGE 3
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Dairy News february 14, 2012
news // 3
Price war risk no threat to farmers SUDESH KISSUN
NEW ZEALAND dairy farmers need not worry Organic milk, yoghurt sets them apart. PG.21
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about major farmgate losses should a supermarket milk price war break out. With 95% of New Zealand milk processed for exports, a retail milk price war will not greatly affect the farmgate price, says Nosh Food Market owner Clinton Beuvink. Beuvink last week slashed the milk price at his four stores to $1/L, in effect issuing a challenge to the two major supermarket chains. He says supermarkets are making 30% profit on milk and can bring prices down. Public expectation is on dairy farmers to drop prices but the supermarket chains have to play ball, he says. “I understand supermarkets make 30% profit on milk – highly unusual for that type of fast moving product line,” he told Dairy News. However, unlike in Queensland, where the Australian milk price war affected farmgate returns, New Zealand farmers have nothing to worry about, he says. “Queensland farmers produce milk for the domestic market.” Queensland Dairy Farmers Organisation president Brian Tessmann agrees. “We’ve seen in
Australia that the impact has been worst in states geared toward drinking milk. States with greater export capacity such as Victoria have not been impacted to the same degree,” he told Dairy News. Federated Farmers has thrown its support behind Nosh saying more focus should be on supermarket margins on milk. Federated Farmers Dairy chairperson Willy Leferink says Nosh is doing more to open up competition at the retail end than any narrowly focused inquiry can ever achieve. “Federated Farmers hopes this milk skirmish is the first step in a wider retail milk price war between Foodstuffs and Progressive. It’s happened in the UK and Australia so why not here? “The focus needs to be on the supermarkets
because if dairies can sell milk cheaper and a small supermarket like Nosh can sell it as a loss leader, surely Foodstuffs and Progressive can do the same? In two locations at least, Foodstuff franchisees already are.” Tessmann says New Zealand farmers should continue to remind consumers about the real value of milk, a nutritious and important food. Farmers must also keep pressure on governments to ensure competition in the retail sector. “Farmers must ensure supermarkets do not gain such power that they can place unsustainable pressure on the remainder of the milk value chain. “The impact of the retail milk war has been felt worst in drinking milk states of Australia, such as Queensland, where production is geared toward fresh milk rather than other products or export. More than 90% of milk in Queensland is fresh milk, so the retail shelf price has a strong correlation to the farm-gate price. We’ve seen a number of contracts come up for negotiation since the price war began, and there is no disputing the downward pressure on farm margins.” Nosh is running its campaign until the end of this month. The Cow and Gate brand milk is supplied to Nosh by Goodman Fielder, which gets the milk from Fonterra under DIRA.
Swazi wheels out dairy attire. PG.42
Parliamentary milk inquiry on
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PARLIAMENT IS to resume its inquiry into the retail price of milk. The commerce select committee’s new chairman, Rotorua and National MP Todd McClay, told Dairy News after its first meeting last Thursday that members felt under obligation to continue the work of
the previous committee. Details have still to be worked out. “A lot of work was done by the previous committee. Some 70 submissions were received and hearings were held.” Some important developments have happened in the milk industry since the committee met last year, with positive impacts for consumers and producers, McClay says.
“So the Committee will have to consider what has transpired since it last looked at this issue.” The committee has yet to decide whether it will hear more submissions. “Many people on the committee are new, including myself, so we need to get an opportunity to fully understand the amount work done under the previous Parliament and then collectively decide the next steps.”
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While he won’t put a date on it, McClay says he would like the committee to draw conclusions in a “pretty reasonable time frame,” dependant on other work pressure, some of which is time sensitive. “This one isn’t,” he says. The commerce select committee meets every Thursday Parliament is sitting.
Dairy News february 14, 2012
4 // news
More raw milk for rival defies logic – co-op sudesh kissun
FONTERRA FARMERS are angry and dis-
appointed with the Government’s DIRA proposals, says chairman Henry van der Heyden. They defy logic – especially the proposal to supply more raw milk to rivals at a subsidised price, van der Heyden heard farmers say at meetings two weeks ago. “The DIRA proposals are not in the interest of either Fonterra farmers or New Zealand,” he told Dairy News. “We’ve no problem with competition but it makes no sense for us as Fonterra farmers to do the hard yards producing this milk, and then have to hand it over to companies that ship it straight offshore and pocket the profits.” Fonterra directors have urged farmers to press
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their MPs to oppose the reforms. Submissions close February 24. MAF recommends a three-season limit for independent proces-
“The DIRA proposals are not in the interest of either Fonterra farmers or New Zealand.” sors who source raw milk directly from farmers. But it proposes an increase in the total quantity of milk available under the raw milk regulations to about 5% of Fonterra’s milk supply. It also calls for a range of maximum quantity limits for independent processors accessing milk in different months to reflect the seasonal nature of production. Van der heyden says there is “a real sense of disappointment” among farmers. “They feel that the Government has let them down.”
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In presentations to farmers the co-op noted the changes will further penalise Fonterra by about $200 million over the next three years.
“The extra 200 million L you and I will be required to supply competitors each year will head straight offshore as the foreign-owned competitors ship their products to their lucrative overseas markets,” Fonterra told farmers. The co-op says the Government has ignored the 1500 submissions Fonterra farmers made on the issue during an earlier consultation round. “The proposed changes will handcuff us at home and weaken our ability to help New Zealand compete offshore. “They screw the scrum further in favour of foreign-owned competitors by requiring us as Fonterra farmers to underwrite and subsidise dairy processors that aren’t interested in making products for New Zealand, and who send their profits offshore. The changes undermine our competitiveness in global markets.”
Fonterra may be forced to supply more raw milk to rivals.
‘Watchdog we can live with’ FONTERRA SAYS it can live with the Commerce Commision overseeing the way it sets the farmgate milk price. MAF proposes Fonterra be subject to a farmgate milk price oversight regime –probably run by the Commerce Commission. This body would comment each year on whether Fonterra’s farmgate milk price is within the range likely in a competitive market – but it won’t be able to
Fonterra also points out the proposed changes are poorly targeted and miss the people they are meant to help – Kiwi families. “And all this comes at
set the price. The farmgate milk price will continue to be set by Fonterra’s board. Fonterra told farmers it doesn’t think this new regime is necessary, but the co-op can live with it. And we’ll be telling the Government that, it says. “Fonterra has nothing to hide, and we’re confident external scrutiny won’t raise any significant issues. We’ve published our milk price manual and the milk
a time when we’re doing all we can to provide local communities with affordable, accessible milk and free milk in schools. It doesn’t make sense.
price statement which shows how the manual is applied in practice–and it’s up to us to ensure we follow it and remain transparent. “But we’ll be making it clear to Government that if this oversight mechanism puts a drag on setting the farmgate milk price and prevents us operating as an efficient global player in sourcing milk, that will ultimately hurt the New Zealand economy.”
“The changes are not good for New Zealand’s economic growth because they will make it harder for New Zealand’s largest company to become more successful on
the world stage. “All New Zealanders and the economy will be the losers if the changes to the Raw Milk Regulations proposed by the Government go ahead.”
NZDL rumour persist SOUTH CANTERBURY Russianowned processor New Zealand Dairies has written to suppliers assuring them they will continue to be paid, and that the company is meeting all other financial commitments. Parent company Nutritek has been looking for a buyer for the NZDL business since November 2010 following financial difficulties with parent company Nutritek. This season it lost several large-scale suppliers to Synlait, the Dunsandel operation 51% owned by Bright Dairy, China.
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Loyal supplier Jim Stevenson told Dairy News he believes some rumours circulating about NZDL amount to scaremongering, and he’s happy to keep supplying them. “I’ve no worries with what they’re doing, I just wish the ownership issue could be settled.” The Timaru Herald last week said a report by corporate advice specialists McGrath Nicol – commissioned by NZDL directors and leaked – says without extra capital the NZDL business is not viable, the main problem being NZDL pays too much for its
milk – well above rival Synlait and too much for a single-site commodity milk powder producer to justify. Industry commentators say the Studholme site’s 5t/hour dryer is too small to be viable as a commodity unit and the money needed to further process product – or build a second dryer isn’t there. Despite NZDL paying him 10c/ kgMS less than Fonterra’s milk price, Stevenson reckons that, having reinvested the capital retrieved from cashing in his Fonterra shares, he is still better off with NZDL.
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Dairy News february 14, 2012
news // 5
Farmers want TAF – chairman SUDESH KISSUN
FONTERRA FARMERS want the co-op to
get on with TAF (trading among farmers), says chairman Henry van der Heyden. Speaking to Dairy News after completing his round of seven farmer meetings, van der Heyden says farmers have been given three options on the custodian holding legal title to traded shares. Van der Heyden is confident farmers will accept the co-op’s preferred option. However, he says it’s up to farmers to make the choice. “At the end of the
meetings I’ve attended, a vast majority of farmers tell us to get on with it.” Van der Heyden says farmers have been asked to give feedback online this month. “We’ve left it to our farmers to decide which option they prefer.” He says the mood in the meetings has been positive and turnout among the biggest since the coop’s formation. However, farmers are angry with the Government’s proposed changes to raw milk regulations and half the time at the meetings was spent on the issue. Despite the outcry over DIRA, he believes farmers remain positive about TAF
and he expects it to be launched in November. The co-op is recommending a farmer-controlled trust to hold traded shares in a bid to appease shareholders, who fear losing 100% control. In 50 shareholder meetings this week Fonterra board and management presented three options, designed to allay fears that legal title to shares placed in the Fonterra Shareholders Fund will be transferred to a custodian not in farmer control. Shares swapped among Fonterra shareholders under TAF will be placed in the fund. Fonterra says its pre-
Henry van der Heyden
ferred option will give farmers “the comfort of direct control and ownership of the custodian”. The preferred option includes a farmer trust custodian owned by a trust controlled directly by farmer shareholders. The other options are: a custodian 100% owned by Fonterra, and farmers individually retaining legal title to shares they place with the fund. Fonterra farmers were
‘Just get on with it’ PAM TIPA
FEARS THAT TAF
(trading among farmers) may swap one redemption risk for another was one of the issues raised at the Edgecumbe meeting, says Bay of Plenty Federated Farmers Dairy representative John Howard. “At present redemption risk comes from individual shareholders leaving the industry. Under TAF it will be from those who have invested in the fund, and it has the potential to be even greater.” He was relaying some of the “robust and challenging” debate surrounding TAF at the meeting where – as at most of
dozens around the country – debate over the share trading scheme often gave way to anger over the proposed raw milk regulations. In general the reaction to TAF at the meetings appears muted, with farmers still absorbing the three options put forward by Fonterra. Howard says it was great to see more details released but there were a lot of concerns expressed. “One was that Fonterra is a cooperative, owned by the suppliers of the milk; many are worried TAF does not guarantee that ownership will continue.” James Stewart, the Manawatu/Rangitikei Fed representative, says there are new concepts to work
through again. “Personally I think the ‘custodian’ thing was sold wrongly right from the beginning. The name really spooked farmers. They have now thrown a farmer concept in there to bring it a bit closer to actual farmers, so there is a farmer elected representative on the trust – rather than totally reliant on the board. “It puts a farmer face on the trust rather than the name ‘custodian’. “One feeling in our group was ‘is this just another layer of people?’ That’s the only concern … and it sounds a little more complicated again.” Stewart says the TAF debate may have dragged on too long. “I think farm-
ers are just keen to see something happen.” Byron Osborne, Rotorua/Taupo, says although Fonterra has stated its preferred option as number 2, at least farmers have been given a variety of options for feedback. “Fonterra put their hand up at the meeting to say they hadn’t explained the ‘custodian’ system properly and full marks saying for that. The mood out there… I think TAF is being looked at very seriously.” Derek Gibson, Taranaki, says some people are still asking ‘why do we need to change this?’ “There are still concerns about ownership.”
told they would collectively retain legal title to shares placed with the fund without extra layers of administration that would potentially make TAF too complicated to work effectively. In contrast, keeping legal title with farmers carries substantial downside risk because of its complexities and potential for value destruction, the co-op says. “For example, keeping track of share ownership in the event a farmer shareholder [dies] would become complicated if their shares were dispersed among children and other beneficiaries to a will.
“The more complicated TAF becomes, the greater the need for detailed explanations why TAF needs to be so different from other investment opportunities,” farmers were told. Fonterra was forced into a re-think after shareholders expressed concern at legal title to shares ending up with the custodian. At its annual meeting in November, Fonterra chief executive Theo Spierings announced management was taking a fresh look at legal title to shares placed with the fund. The co-op says the custodian approach is a straightforward solution that would achieve
TAF objectives. “Let’s be clear: the custodian is not a person, it’s not an entity, and it’s not a decisionmaking body that holds meetings. It is purely a mechanism to hold legal title to shares for the benefit of farmer-shareholders.” Fonterra admits it had not explained the custodian as well as it should have. “But the reality is the custodian is 100% controlled and owned by Fonterra, and Fonterra is owned by farmers. However, it’s not enough for the board to be comfortable about this. Farmer shareholders need to be as well.”
DIRA raises heckles PAM TIPA
FARMERS WERE this month “mooing
blood” at a Fonterra-organised meeting over the Government’s proposed raw milk regulations, says Federated Farmers Rotorua/ Taupo Dairy representative Byron Osborne. The Rotorua meeting was one of dozens around the country to discuss the new TAF (trading among farmers) proposal. However farmers were far more steamed up about Government proposals for Fonterra increased raw milk supply to independent processors, several representatives say. “DIRA is raising some heckles out there. The Government has really stood on the farmers’ toes,” says Osborne. “The farmers were just about mooing blood over DIRA, they were quite concerned. “I don’t often go to meetings where farmers stand up and say ‘I don’t think this is good enough and I don’t like what they are doing’. Osborne says among about 60 attending some were talking disobedience and
the directors were asking them to calm down. Farmers were particularly concerned about access outside the production curve and the extra 10c on the shoulder milk price being removed. “I think they were annoyed we had put 1500 submissions in but the Government walked away from them and said ‘right this is what we are going to do’. Some farmers felt let down by it considering we had voted these people in – to be treated like that. Farmers would have to resubmit to the MAF discussion document. “But we’re not really into putting these submissions in every three to six months – it takes a lot for a farmer to put a submission in and we find it a jolly nuisance.” Manawatu/Rangitikei Federated Farmers Dairy representative James Stewart, who attended the Palmerston North meeting, says the farmers were gutted about the raw milk regulations. “They just feel like they are subsiding competitors. It would be all right if they took it all through the season – but they can turn it off and on when they want.”
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Dairy News february 14, 2012
6 // news
TAF doubts remain – Guiney andrew swallow
round of meetings nationwide putting three options for TAF on the table, critics remain unconvinced the proposal can deliver the much promised 100% ownership and control. Comments from Fonterra representatives saying the feedback at the meetings was overwhelm-
ingly to “get on with it” have also grated with some. “This is certainly not the case in Whangarei,” Bruce Hayes, Hikurangi, says after reading Fonterra chairman Henry van der Heyden’s comments to Dairy News’ sister paper Rural News. At Gore, Richard King felt most people listened and needed to digest what was presented, rather
than hearing a go-ahead signal. “There was no antipathy to it but a lot of people were wanting to think about it and talk it through. “One of the problems was DIRA and TAF were discussed at the same meeting and if anything DIRA detracted from the discussion about TAF which is probably the more serious issue. “I’m concerned this could be a
lever in the door and went away feeling we really need to look into this further.” South Canterbury farmer Leonie Guiney, who’s been leading a call for a second vote on TAF, says the three options presented still don’t address what she and others believe will be a legal rights for unit trust holders to challenge Fonterra management
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over the split between dividend and milk price. “But I think those options are now irrelevant,” she told Dairy News. “Government sees this as its opportunity to influence our milk price. A year ago I asked what we were trading off with Government to get TAF; this paper reveals it. “This is not about the 5% of our milk on the domestic market. This is about all our milk, including the 95% we export.” She highlights clause 41a of MAF’s draft regulatory impact statement on Fonterra milk price setting, capital restructure and share valuation. It says external inves-
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meetings I have attended, a vast majority of farmers are telling us to just get on with it.” But Guiney begs to differ. “From what I’ve heard every meeting was contentious.” She believes the only way to stop TAF now is through the Shareholders Council. “The chairman of our council is our last hope. I was initially critical of the council’s inertia on this whole issue but now know they have had information withheld from them.... Information has been delayed and delayed so this proposal can be pushed through Parliament before it can be stopped.”
Council to protect 100% ownership FONTERRA
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tors (through TAF) would counterbalance Fonterra shareholder’s interest to maximise the milk price. “Our cooperative’s purpose is to maximise milk price. If our board at present doesn’t consider Government regulation of our milk price to be a major issue then we’ve got a major governance failing.” Fonterra chairman Henry van der Heyden was last week unavailable for interview, however he had previously told Dairy News’ sister paper Rural News that he’s confident farmers will accept the co-op’s preferred option: a farmer-owned trust to hold traded shares. “At the end of the
Council chairman Simon Couper says it will ensure 100% ownership and control is safeguarded, and the council has the powers to stop TAF even if it meets the five preconditions the first vote on TAF set up for council sign-off. “The council has an obligation to look at the preconditions but also it has an obligation to look at the nature of the co-operative and how that is preserved,” he told Dairy News. “If we don’t do that, we’re not doing our job. “The influence unit holders could have is a concern... but perhaps it is not as big an issue as some others [concerning TAF].” Feedback to the council from the 50 meetings nationwide is that TAF issues were overshadowed by DIRA and the
proposal that Fonterra must increase its supply to competitors. “There was a lot of noise and frustration that competitors will be able to continue to take milk on the shoulders of the season with the effect that Fonterra is subsidising them.” With regards to TAF, he says “it’s fair to say there’s probably more concern in the South Island than in other places, but at the meetings I went to [in Northland] there were concerns raised about ownership and control.” If farmers were saying “get on with it” at other meetings, it would be with the proviso that 100% ownership and control is not compromised. “The job council has is if this is to go ahead we need to see the detail bears out what they expect.”
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Dairy News february 14, 2012
news // 7
Crafar deal still on hold PETER BURKE
THE PURCHASE of
the sixteen Crafar Farms by the Chinese company Shanghai Pengxin technically remains on hold until the outcome of court action by a consortium headed by Sir Michael Fay is known in a few days time. The High Court judge has indicated that his decision will be out by the middle of February. A spokesperson for the Fay consortium, Alan McDonald told Dairy News that it was hard to predict the outcome of the court action given that it is a ‘test case’. He says they remain concerned at
the Overseas Investment Office (OIO) process saying it lacks ‘transparency’ and is secretive. The judge’s decision will be precedent setting. If he finds in favour of the OIO it will be business as usual. But if he accepts the arguments of the Fay group that any overseas purchaser of land must have ‘farming experience’, then that could have far reaching implications for any future sales of land to overseas buyers. At present most land bought by overseas investors is managed by New Zealanders on their behalf. In the case of Pengxin, Landcorp is doing just that. However even if the
judge rules in favour of Fay it probably won’t stop the sale to Pengxin going through. All it could do is to open up a pandora’s box of further litigation potentially against the OIO and the government. It’s understood that the delay in settling the deal is not only as result of the court action, but is related to some final conditions relating to the deal being approved by the OIO. One such condition is that a ‘property management agreement’ and a ‘farm operation agreement’ is entered into between Milk New Zealand and Landcorp, and that the OIO is satisfied that there are no
material changes to the agreements. The OIO is currently reviewing the terms of these agreements. Once the OIO have approved these arrangements the sale can go
unconditional. All that Pengxin and the receiv-
ers have agreed to do is for the Chinese not to hand
over their cheque until the court ruling is decided.
Lower NI riparian expertise on offer THE EXPERTISE of Lower North Island dairy farmers is contributing to fact sheets to help farmers build and maintain riparian margins of streams on their land. DairyNZ Farmfacts are devised by DairyLink – representing Horizons Regional Council, DairyNZ, Federated Farmers and Fonterra, who aim to give dairy farmers in the Lower North Island more workable and consistent information. The fact sheets (available via dairynz.co.nz) advise on appropriate plant species, pest and weed control and ways to maintain stream banks. DairyNZ Lower North Island regional leader Scott Ridsdale says the Farmfacts are a good starting point for farmers with questions on riparian planting. The group first invited farmer input, then used the experience of farm-
Waikato water consents loom SOME WAIKATO dairy farmers forRiparian planting in Taranaki.
ers who had done a lot of fencing to inform those in the early stages of riparian planting. “That way we were better able to anticipate the kind of knowledge farmers would want access to no matter what their situation.” A riparian margin buffers (reduces) the amount of sediment, phosphate, dung and E.coli washing
off land into waterways. There are many benefits from protecting and managing farm waterways, says Horizons rural advisor Peter Taylor. “[These] time and resources... create direct benefits for farms, waterways and the broader environment. “By accessing good information farmers can ensure the benefits of
any riparian planting last well.” Horizons last year helped plant 7000 plants on stream banks in its region, says Taylor. “Everyone in our region benefits from cleaner waterways... so in recognition each year we have a small pool of cash available to support riparian planting on farms.”
merly taking water as of right will now need resource consent under new policies. Farmers must apply to Waikato Regional Council for water take consents under the council’s Variation 6 policy on water allocation. Its policy and strategy committee recently heard no High Court appeals had been lodged against the variation endorsed by the Environment Court. The new variation maintains an existing requirement that farmers taking more than 15m3 of water a day for dairy shed wash down and milk cooling must have resource consent. Some 3500 farmers in Waikato not holding such a consent will need one. Under Variation 6, farmers who had been taking more than 15m3/day for dairy shed wash down and milk cooling as at October 2008 will generally have the
amount taken in 2008 “grandparented” providing they meet a range of conditions, such as applying for a consent within a specified deadline, developing a riparian management plan (if the take is from surface water) and excluding stock from waterways. Also, in catchments where rivers and streams are already over-allocated, any new water take will require consent even if less than 15m3/day. Previously, taking up to 15m3/day has generally been an ‘as of right’ permitted activity, and will remain so in catchments not fully allocated. Council resource use division manager Brent Sinclair said his team was doing detailed planning to ensure farmers in different areas are aware of their responsibilities under Variation 6.
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Dairy News february 14, 2012
8 // news
Science losing pasture link Doug Edmeades
agricultural scientist says the New Zealand science system has lost its connections with farmers in respect of helping them improve their clover based pasture systems.
Doug Edmeades told Dairy News at last week’s Fertiliser and Lime Research Centre conference at Massey University that he’s appalled at the quality of technical advice given to farmers about soil fertility and pasture nutrition. “The comment I get fre-
quently from farmers is they don’t know who to turn to for expertise, skill and knowledge about this art of soil fertility and pasture nutrition.” With the demise of MAF advisors there is a lack of qualified, independent people to advise farmers.
“Overseas visitors used to comment on the wonderful extension service we had. All that’s gone and the people who remain – who have general purpose knowledge – are more likely to be managing the resource on the farm or the finances, not the technical side of growing and managing pasture. Edmeades says scientists have lost their direct contact with farmers. Years ago scientists at the Ruakura Research Station, Hamilton, used to hold a conference and open day before National Fieldays, which was very good. But the way science is now funded has diminished the contact. “The focus has gone away from doing research for farmers. CRIs such as AgResearch are doing research for their own balance sheets, not for the farmer. That’s one reason I quit the organisation. I don’t see CRI people around farms. You see them at meeting like this one. These talk-fests are brilliant, but they’re mostly full of words and
there’s nothing a farmer can actually take away from here.” He also noted the almost total absence of farmers from the conference. Edmeades says the Palmerston North conference is not the only event not connecting directly with farmers. “I went to one on biological farming and they had three farmers there who spoke and not one of them put up alot of information or evidence about biological farming.” A hallmark of modern society is the emergence of ‘pseudo science’, Edmeades says. “Statements are made to look as if they are science because they use scientific terminology, but when you examine them there’s no evidence to support the statements. For example, people say biological farming is better for the environment. It sounds good but when you actually look at it, there’s no evidence to say that. In fact all the evidence says if we all went organic tomorrow, production would be cut by about 50%.”
Scientific advice given to farmers about pasture has been questioned.
in brief CD Field Days coming THERE WILL be something for everyone this year at the Central Districts Field Days, say organisers. Three days filled with shows and demonstrations are planned for March 15-17. Massey University is the main sponsor, telling how it works with industry and business to improve innovation and productivity. Central Districts Field Days event manager Cheryl Riddell says Massey will showcase work in precision agriculture and food technology. “We are excited to be working closely with Massey University again this year.“ Riddell says the sponsors of the event are a major reason for its success. One of these is the Stihl TimberAces 2012 CD Field Days axe men’s competition. Another is Case IH hosting the annual tractor pull. And there will be a business house competition in the tractor pull.
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Dairy News february 14, 2012
10 // news
Clean dairying at expo A NEW ‘good clean dairying’ promotion will feature at this month’s Effluent Expo at Mystery Creek. Organised by Waikato Regional Council and sponsored by DairyNZ, the expo on February 28 will offer farm effluent management information to farmers to benefit farmers’
environment and profitability. “Dairy farming can often be labeled ‘dirty dairying’,” says council agriculture advisor Kate Ody. “But many Waikato farmers are doing a great job of protecting the environment already and many others are lifting their
game to do better. “The huge turnout at last year’s inaugural expo, attended by one in 10 of the region’s dairy farmers, is one example of the industry’s efforts to improve effluent management. “Our new ‘good clean dairying’ promotion, at
the council’s stand at the expo, will aim to model and promote many examples of clean dairying in our region. Initially we will focus on having effective effluent storage. “And the council will continue monitoring compliance with its farm effluent management rules
and take regulatory action where appropriate.” Ody says the ‘good clean dairying’ promotion is still being developed. The council will announce more details at the time of the expo. At least 40 exhibitors are booked; 25 attended last year.
Keep it low
Tracking nutrient flows around farms will become easier after Overseer’s upgrade.
Nutrient tracking upgrade
This summer DairyNZ is encouraging farmers to keep their effluent pond levels low, by irrigating when weather conditions allow. By autumn storage ponds should be as empty as possible. With fewer fine days and greater rainfall, winter can test even the largest ponds. This summer – keep it low and have your effluent pond as low as possible by autumn. For more information on storage pond management visit dairynz.co.nz/keepitlow
‘fridge magnet’ storage pond gau ges as shown in the illustration are av ailable by sending your details to keepitlow@dair ynz.co.nz
OVERSEER, A system used to track nutrient flows around farms – especially dairy – is to be upgraded. Overseer is owned jointly by MAF, Fert Research and AgResearch. Farmers, fertiliser companies and regulators such as regional councils use Overseer to determine nutrient levels and to set application rates for fertiliser. The AgResearch scientist responsible for developing Overseer, Dr Mark Shepherd, told 200 people attending last week’s Fertiliser and Lime Research Centre conference at Massey University that the upgrade will include new software and updating the science. Shepherd says one purpose of the upgrade is to make it applicable to more farming systems. “For example more farms import or grow more supplements so that’s a key part of the model we’ve tried to improve. “We’ve looked again at some of the sub-models within Overseer to see that they are using the most up-to-date science. This is important because science is always evolving.” Shepherd says upgrading the software will also benefit users. “One benefit will be greater opportunity to link with other software packages to avoid double data entry. The owners of that software have agreed the links will be free of charge and this could create benefits for users way into the future.” Overseer, launched in the 1990s, has always had nutrient budgeting as a primary fucntion. Its purpose has been to enable farmers to make more efficient use of their resources. “That’s always been the underlying principle and still is really,” Shepherd says. “One outcome of not using nutrients as efficiently as possible is you lose them to the wider environment. They will then impact that environment.” While Overseer is used widely on farms, it’s seldom actually used by farmers. Shepherd admits it’s an ‘expert users’ tool and has to be used by trained people. Fertiliser companies run in-house training and Massey University has courses on advanced nutrients and intermediate nutrient management. Now there is talk of having accrediting independent users to avoid perceptions that the system could be used to advantage by people with ‘vested interests’. Learning to use Overseer is not a matter of learning which buttons to press, but instead understanding farming systems, Shepherd says. It’s a strategic planning tool farmers can use to manage nutrients. Overseer must be kept relevant to users and developed in the way users want it to be developed. “A key to this is upgrading the science.”
Dairy News february 14, 2012
news // 11
Olam buys big in Russia pore-based multinational with stakes in a couple of New Zealand registered dairy firms, is moving into Russia. It has announced a “partnership” with the Russian Dairy Company (Rusmolco) which sees an initial investment by Olam of up to $US75m for 75% of Rusmolco’s equity. Olam, which owns at least 80% of New Zealand Farming Systems Uruguay and has a 25% share of Open Country Dairy, says it aims to have a 20,000cow milking herd and 106,000ha grains operation started in four-five years. This “first phase” of expansion of Rusmolco’s 3600 cows and 52,000ha is expected to cost up to $US400. Phase two is to double the scale in threefour years, taking the herd to 50,000 producing 500 million L/year with 130,000ha of grain production. Such expansion would make the partnership the leading milk producer in Russia and put it in the top 10 private milk producers globally, says Olam. “The investment in Rusmolco is another step in implementing Olam’s dairy and grains strat-
egy of selective integration across the value chain with end-to-end capabilities,” chief executive Sunny Verghese said January 30 when the deal was announced. “Rusmolco has a strong dairy platform and 106,000ha suitable for agriculture, an attractive platform and asset base hard to replicate in a short time. Our Russian partner has a deep understanding of the local market and I am confident that this investment is a step toward a profitable and promising venture.” Naum Babaev, founder and chairman of Rusmolco, sees “enormous potential in partnering with Olam in this venture.” “Olam’s financial resources, management and experience of operating in 65 countries create a platform for development of our business. Together we hope to achieve a dominant position in the industrial milk segment globally.” The chairman of Russia’s National Dairy Producers Union, Andrey Danilenko, says Olam’s partnership with Rusmolco is unprecedented in the Russian dairy industry. “The investment by a global leader such as Olam
is proof agriculture production is becoming one of the most attractive sectors in the global economy in which Russia can be a large and important contributor.” Olam has been in Russia since 1993 and says it is one of the most attractive markets for dairy
farming today because of its high domestic demand and consequent large and growing demand-supply gap. Competitively priced fertile land makes for low feed costs and the Russian government increasingly supports private investment in local dairy productivity and output.
Olam holds majority shares in New Zealand Farming Systems Uruguay.
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Southern weather challenge DESPITE GOOD levels of rainfall in South Otago and Southland, dairy farmers there are still managing difficult, dry conditions. DairyNZ regional leader Miranda Hunter says most farmers have short-term plans for the next few weeks, but autumn and winter will be a challenge. “Pasture growth rates are improving and are now ranging from 19 to 40-plus kgDM/ha/ day, but supplements are still being fed on the majority of farms.” Dairy farmers need to focus on their crops and evaluate what any shortfall means going into winter, she says. “This has been a challenging season to date; the majority of farmers will be looking at production below budget and increased supplement costs. Good planning will ensure there is not a carry-over impact to next season.” While early-winter crops are in a better position than later crops, DairyNZ recommends farmers seek advice now from their technical field reps to develop plans and deal with weeds and pests. “A lot of larger plants are carrying pests eating new growth as it comes through. Pest management is important,” says Hunter. She also encourages farmers to develop plans for winter, to help prevent the impact of this summer’s dry conditions spilling over into next season.
Rusmolco was formed in 2007 and has nine livestock farms in seven areas of Penza region, specialising in dairying and cropping. It employs 900 people and claims to be “the largest and most promising raw milk producer in the region.”
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Dairy News february 14, 2012
12 // news
Feed ordering goes online FONTERRA FARMERS can now mix and
order supplementary feed blends online through the co-op subsidiary RD1. The retailer’s online ordering platform, launched last June, was revolutionary in the supplementary feed world, allowing farmers more transparency and control when placing orders.
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The ability to now order custom blends means farmers have even more control and flexibility. It’s quick and easy to use, says RD1 nutrition operations manager Mike Borrie. “Farmers input into the system will come straight through to RD1 Nutrition for processing. We’ve had good feedback on our existing online ordering tool. They’ve found it simple and straightforward. And they enjoy the flexibil-
ity of being able to place an order any time, day or night. “Now being able to make custom blends online we are sure will be a
welcome initiative.” The custom blends tool features an online blend calculator for reckoning the tonnage rate for whichever feed and ratios
are selected. The range includes PKE, tapioca pellet, wheat bran pellet, biscuit/cereal meal and cottonseed meal. Online ordering through RD1 is only available to Fonterra farmers, as is the ability to see supplementary feed pricing. “They can see our pricing daily and place orders online.” Currently the blending service is only available in the North Island – Tauranga and New Plymouth.
West Coast’s effluent trial face hurdles PETER BURKE
TRYING TO develop an effective effluent disposal system for West Coast dairy farmers is proving a challenge for two AgResearch scientists, Dave Houlbrooke and Seth Laurenson.
The pair is in the middle of conducting a six month trial on the Coast with the principle objective of trying to reduce nutrients leaching in to Lake Brunner, a popular tourist attraction. But as part of this trial they are looking at the wider issue of managing dairy effluent in what is a very high rainfall area.
farm dairy effluent (FDE) using low rate effluent applicators and comparing this with the system of direct discharge from the traditional ‘two pond’ system. Houlbrooke says it’s too early to come up with any definitive answers from the trial. “What is clear is that what works for the rest of New Zealand won’t necessarily work here because it’s so much wetter. We will need to readjust the rules for the West Coast and we are still working out rates of applications, volumes and timings,” he says. Covering yards to capture rainfall and prevent it infiltrating into the effluent system could be of benefit, says Seth Laurenson. But he concedes that this could also be an expensive option for some farmers. “The dairy industry as an organisation acknowledges that it needs to look at the way they manage nutrients and be quite careful about that management of these. I think
“The dairy industry as an organisation acknowledges that it needs to look at the way they manage nutrients and be quite careful about that management of these.”
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The problem they say is compounded by the high water tables which limit options for land effluent disposal. Their work has been funded by DairyNZ with strong support from Westland Milk Products which is why it took off, says Houlbrooke. The West Coast is unique in that much of the land developed for dairying is ‘humped and hollowed’. Diggers have been used to create a landscape that looks like corrugated iron with small man-made hills and valleys in each paddock with the cows grazing on the ‘humps’ when it gets very wet. But the soil is good and despite the unique wetness of the region, dairying is profitable business. The trial is comparing
there’s quite a lot of support for this project because it’s helping to develop those key management decisions,” he says. Houlbrooke says he hopes one of the key outcomes of the trials will be to prove to farmers that careful management of nutrients on a dairy farm will have a direct financial benefit. “We have started a dialogue with farmers to demonstrate correct disposal of effluent to land can actually pay for itself. It means keeping streams clean and provides an economic benefit to the farmer,” he says. The trial is due to end in May and Houlbrooke says they hope to get their results out as soon as possible after that.
*RD1 will supply all contracted tonnage. Spot tonnage is dependent on availability.
Last year RD1 Nutrition brought you online ordering, this year we’re giving you full control! As a Fonterra supplier you can now mix up your own custom blends of supplementary feed online.^ Just go to WWW.RD1.COM/orderfeed We’ve kept the process simple with our online blend calculator: Select the feeds you want Choose the ratio of your blend We then calculate the tonnage rate for your custom blend You can blend any product in the RD1 Nutrition range, at ratios that you want.
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Dairy News february 14, 2012
14 // news
Milking bonus/fine idea raises farmers’ ire GARETH GILLAT
FONTERRA FARMERS say they don’t want
Fonterra’s plan to fine or reward farmers for milking times is under fire.
to be fined or rewarded for shorter or longer milking windows. This issue has arisen for some farmers after
they adopted 16-18 hour milking schedules and taken on 1arger herds. Fonterra in late January wrote to shareholders asking them for proposed milking times. The letter suggested rewarding (with bonuses) farmers who milked within their stated
milking times, but penalising (with fines) those still milking when the tanker arrived. This caused anger and confusion among farmers, who vented their concerns at shareholder meetings, during calls to Fonterra and in conversations with
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farmer representatives. Fonterra Shareholder Council chairman Simon Couper says he does not favor the proposed bonus/ fine scheme. He has yet to hear what other farmers think of it. “We don’t want to see farmers penalised for what is essentially their business,” he says. Farmers spoken to by Federated Farmers Auckland Dairy chairman Phillip Bell strongly oppose fines or bonuses, and some wonder why the matter has been raised. “They don’t want to be pinged or rewarded for this. They feel there are better things they could be credited for and better things they could be pinged for.” Fonterra general manager for milk supply Steve Murphy admits it is not a big issue globally but something individual farmers – especially those on 16 - 18 hour milking rotations – could sometimes struggle with. “We have had an infor-
mal system in place in the last few years where people called us up and told us what hours it was OK to pick up their milk. This is an attempt to cement that. We accept the challenges faced by people milking 16-18 hours a day and this is our way of acknowledging that.” Murphy says early indications from farmers’ meetings are that the bonus-fine system is “a bridge too far”. Bell suspects the biggest problem was discussion of fines and bonuses in the survey letter. “If anything it was premature. It felt a bit cold, making it look like they were going to ping you.” Murphy says the co-op is unlikely to drop the punishment/reward concept of milk window revision completely, instead trying to find suitable middle ground. “The great thing about a cooperative is making it work between everybody.”
‘Turbo charged’ Large Herds meet looms NEXT MONTH’S New Zealand Dairy Business Confer-
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ence will allow dairy farmers to see the nation’s top scientists at work in their world-leading research centres. The 43rd annual event hosted by the New Zealand Large Herds Association and farm nutrition company Altum will be held in Palmerston North. New Zealand Large Herds Association chairman Bryan Beeston is encouraging dairy farmers to visit the dairy research and development capital of New Zealand. “It’s an opportunity to see innovation as it happens, with Fonterra making a rare decision to allow delegates a glimpse behind the scenes at its Palmerston North based research centre,” says Beeston. The facility employs 100 world class scientists, is the world’s largest dairy research facility and has one of the world’s largest dairy pilot plants. The conference, ‘Turbo charge your knowledge’, runs from March 27-29 and is an opportunity to hear key business and industry leaders discuss their views on dairy research, technology and brand opportunities. Another benefit of the conference is networking, says Federated Farmers Dairy chairman Willy Leferink, ten years an attendee. “It always has good, stimulating speakers, but the real value is networking with people – speakers or farmers you see every year. And there’s a huge learning opportunity with that,” says Leferink. Beeston agrees, saying the chance to meet agribusiness professionals and industry peers in the one venue means a lot of business is done. “New ideas and techniques are discussed and often relationships are formed that then become instrumental in building your business.” Beeston says farmers will get maximum value from attending the whole conference, but it’s possible to register for individual days if that’s all time allows.
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Dairy News february 14, 2012
16 // world
Queensland farmers slam Govt inaction on milk war QUEENSLAND DAIRY
The Australian Government is taking a back seat in the supermarket milk price war.
erences Committee’s 2011 final report of the supermarket milk price war and competition and pricing in the Australian dairy industry. They have also taken a swipe at Treasurer Wayne Swan, a Queenslander.
farmers are accusing the Federal Government of a sellout. The farmers are unhappy with the Gillard Government’s response to the Senate Economics Ref-
Queensland Dairy Farmers Organisation president Brian Tessmann says after two years of Senate inquiries and clear evidence of mounting impacts on dairy farmers, the Federal Government
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is yet again avoiding the disaster, ducking for cover and taking no action. “The Gillard Government and more disappointingly Wayne Swan, as a parliamentary representative of Queensland, have turned their back on Queensland dairy farming families being impacted directly by the milk price war,” says Tessmann.
farmgate price. Tessmann says the Coles lead milk price war has already impacted many Queensland dairy farming families and has contributed to the loss of some 30 dairy farmers from the industry in Queensland since January 2011. “The next wave of impacts from the milk
“They have shown complete disregard for the future sustainability of the dairy industry.” “They have shown complete disregard for the sustainability of the dairy industry that supplies Australian consumers with fresh milk and dairy products every day. “The Government has been repeatedly presented with clear and incontestable evidence that Coles’ marketing tactic is adversely affecting dairy farming families and action needs to be taken now. “They’ve also been presented with clear evidence that in the long run there will also be a negative impact on consumers, via the experience of shoppers in the United Kingdom.” He says the Federal Government has failed to commit to the Senate Inquiry recommendation of a review into the impacts on the Western Australia, New South Wales and Queensland dairy industries and has chosen to pass the buck and hide behind the ACCC, which has time and again proven itself to be ineffective and powerless against the tactics of the major supermarkets. “For the Government to rely on the ACCC defies logic when we all know it does not have the necessary power to counter the tactics of these major retailers.” The price war was triggered by Coles Supermarket, which slashed the price of its home brand milk to $A1/L. Other supermarkets matched the price. The price war has led to downward pressure on the
price war is now hitting farmers with some half of Queensland dairy farmers having their milk prices and incomes cut on average by some $A30,000 to $A40,000. This follows the other half of Queensland dairy farmers having their incomes slashed by 15-20% the previous year. “These mounting impacts will put many dairy farmers into the red and will see more farmers leave our industry when we can’t afford to lose any. Already I know another five farmers have their herds booked for sale.” Tessmann notes Queensland’s milk production this year has fallen short and it needs to produce another 100 million L to meet the needs of the population of Queensland over the next decade. During the Senate Inquiry the ACCC admitted it had “not done any monitoring of the other items” in reference to the 15,000 other items in a supermarket, that Coles may be increasing prices to offset the price cuts on staples such as milk and that they had not checked if Coles was selling below cost in regional areas. “Even Coles’ major competitor Woolworths stated a year ago that the price cut was unsustainable and would lead to farmers being impacted,” says Tessmann. “We all deserve much better than the current complacency of the Federal Government.”
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Dairy News february 14, 2012
18 // opinion OPINION Ruminating
Let’s not kill the golden goose
milking it... Dairy politics in play? IS POLITICS behind the Government’s proposal to force Fonterra to offload more raw milk to rivals? One industry heavyweight thinks so. He points to the pre-Fonterra days when National was in power and opposing the co-op’s formation. Then came Helen Clark in 1999, rightly deciding Fonterra was the way to go. Now with National back in power, we again hear talk about clipping Fonterra’s wings. The dairy heavyweight who contacted us reckons some National Party stalwarts are lobbying hard in Wellington. Only time will tell whether they get the Key to Fonterra’s treasure.
Watery excuse AS MAJOR users of water, dairy farmers will be wondering if they’re going to be next. The Maori Council is claiming ownership of water used in Governmentowned hydro power stations. The council is doing this in a bid to stop the partial privatisation of SOEs. With dairy farm sales to foreigners a hot topic, will the council use a similar claim to block their sales. What next?
Are we targeting the Chinese unfairly? OFFICIAL FIGURES show Americans, Canadians and Brits are the top buyers of New Zealand land. Figures released by the Overseas Investment Office (OIO) show during the past five years only 223ha was sold to Chinese buyers. A total of 872,313ha of New Zealand land was sold to foreign interests during that time. The top buyers were the US, Canada, UK, Australia and Israel.
What price gouging? WITH THE Crafar sale a step closer to conclusion, all stakeholders will be taking stock of how the saga played out over the last two years. What we are interested to know is the financial cost of this sordid affair. For a start, how much have the receivers made operating the farms since they went into receivership?
MAF’S DRAFT regulatory impact statement (RIS) on Fonterra’s milk price setting, capital restructure and share valuation makes worrying reading, unless you’re a competitor of the cooperative, or a corporate investor. The ministry wants to regulate milk price governance, with Commerce Commission monitoring and mandatory disclosure of pricing information. Meanwhile, to ensure freedom of supplier entry and exit from the co-op, the ministry’s preference is legislation to “underpin and strengthen” Fonterra’s TAF (trading among farmers) proposal. Earlier in the 20-page document MAF notes TAF would, through the interests of external investors in Fonterra, provide some counterbalance to the interests of Fonterra’s farmershareholders, whose interest is primarily to maximise the milk price Fonterra pays them. So the ministry is echoing what those raising concerns about TAF have been saying all along: outside investors, even if only buying units giving them dividend rights, will seek to minimise the milk price and maximise the dividend. MAF also notes investors holding fund securities may be consulted on nominations for Fonterra’s independent board seats. If TAF doesn’t go ahead, the ministry recommends legislating share pricing. What’s prompted MAF’s suite of regulatory recommendations? It’s worth noting the Ministry of Foreign Affairs and Trade, among others, was consulted and agreed on the RIS content. There’s little doubt many of our trading partners would love to see Fonterra hobbled. There’s also the political background: a Prime Minister who has publically acknowledged he’d like to see Fonterra listed and a governing party that was in opposition when Fonterra was formed. Meanwhile some of those who were MPs at that time now have interests in Fonterra competitors. And Fonterra’s rivals are using furiously lobbying in Wellington to clip Fonterra’s wings. MAF clearly doesn’t trust Fonterra not to abuse its dominant position. Competitive contract pricing when New Zealand Dairies and Open Country opened new plants in the South Island can’t have helped. But has it occurred to MAF that Fonterra may be able to pay more to its suppliers simply because it is more efficient, and has economies of scale? After all, that’s why Fonterra was formed.
Dairy News february 14, 2012
opinion // 19
No magic bullet to lift economy BUILDING A more competitive and productive economy is one of the priorities of the John Key-led Government. Speaking at the Waitakere Business Club recently, Key outlined how he plans to do this. FOR THE most part,
New Zealand’s growth over the next year has already been set in train, and any stabilisation is the job of the Reserve Bank. The Government’s main role is to keep looking out over the next five years or so and put in place policies that will help the economy become more competitive and productive – through good times and through bad. Again, the European crisis offers some important lessons. Here in New Zealand we have also lost competitiveness over time, particularly as a result of poor
policy decisions in the 2000s. In other words, it has got harder than it would otherwise have been for our exporters to compete in overseas markets. And it has got harder than it would otherwise have been for New Zealand manufacturers to compete with imported goods made offshore. As a result, the industries and sectors that compete internationally actually went into recession in late 2004 and shrank in size by almost 10% in five years. That decline in competitiveness began to turn around during the
Looking after mates WHAT AN excellent article by Pam Tipa in Dairy News (January 31, page 3). David Carter seems to show his true colours and little understanding of the competition in the New Zealand dairy industry. He is only looking after his National mates involved in the many opposition companies – at least six at last count. DIRA is a lemon, get rid of it and let competition prevail, but he wants one sector to subsidise another. Carter is proving to be a real failure for agriculture in general. Perhaps he will be better playing with water. As a dairy farmer for 51 years and a strong National supporter, I told the New Zealand chairman and our local chairwoman we won’t donate again while we have to milk our cows all year round and they give it to the opposition to process and sell against us. Keep up the good work, Dairy News. B. Parone Okaihau Northland
ONLINE POLL Do you think major supermarkets should reduce profit margins on milk and bring prices down? ● Yes ● No
Have your say at: www.dairynews.co.nz
past three years. The Government’s view has always been there is no magic bullet – no one ‘big bang’ reform that would turn the economy on its head. What is required is a
series of good policy decisions and reforms over an extended time, in 100 different areas, to enhance the competitiveness of New Zealand firms. So we have a busy economic reform agenda, follow-
ing through things we started last term and on new things we announced during the election. For example: We’re rolling out ultrafast broadband and the Rural Broadband Initiative, to lift New Zealand’s connectivity. We’re introducing a sixmonth limit for granting
consent to medium-sized projects under the RMA, to reduce costs, uncertainties and delays. We’re negotiating free trade agreements with nine countries in the Trans-Pacific Partnership, including the United States, and separately with a number of other countries including India,
Russia and Korea. I have tasked Bill English and Steven Joyce – the two most senior economic ministers – with driving this economic action plan. I have told them I want to see this action plan regularly updated. The first update will be in the middle of this year.
Dairy News february 14, 2012
20 // agribusiness
Solid dairy growth forecast EXPECT THE global
dairy market to grow strongly: that’s the forecast from global lender Rabobank. Its new report Global Dairy Outlook: Show me the Money says the global dairy sector looks set for a future of solid market growth – to some extent the envy of the food world. China is expected to provide most of the growth and New Zealand, with its free trade agreement, could reap the most benefits, it says. The report examines the outlook for global dairy over the next five years, and who is profiting from the changed market environment in which the dairy industry operates. Rabobank senior dairy analyst Michael Harvey says growth will be dominated by developing markets, many needing outside help to supply
enough product to meet rising appetites. “This will sustain an era of trade growth and provide a substantial opportunity for many farmers, traders and processors in export regions. “A lot of the global growth will come from China, and New Zealand is well-placed to capitalise on that growth given its existing trade linkages to the market which are supported by a trade agreement.” With most of the growth in consumption volumes expected in regions already short of milk, such as China and South East Asia, Harvey says a big share of supply will need to come from export regions. Rabobank’s report shows the cost of producing milk in these exporting regions remains much higher than before the
2007 commodity price boom. “Importantly, we also find evidence the gap between ‘low’ cost and ‘mid-table’ cost milk producers is narrowing, providing a more level playing
field for exporters in a range of regions, and increasing the importance of export cooperatives in ensuring their farmers are best placed to benefit from opportunities abroad,” Harvey says. The report expects production costs to remain elevated for the medium-
term, supporting a high trading range for dairy commodity prices. Harvey says in essence, Rabobank’s analysis indicates the vast increase in money flowing through the dairy supply chain in recent years has been either ‘eaten up’ by farmers’ input costs or capitalised into the value of farmland. “On-farm profitability has improved somewhat, but not enough in most cases to improve the average return on assets despite the increased difficulty of managing what has become a more volatile business. “Nor has there been a large improvement in the position of the downstream dairy processing industry, though the sector has done extremely well to defend or modestly improve its position despite the challenge of
rising costs.” In reality, Harvey says, an era of strong demand and heightened prices for dairy has brought as many challenges as opportunities. “Experiences for dairy processors have varied depending on the which part of the sector they have exposure to – despite a step-change in ingredient costs and, for many, a difficult market environment, processors have generally maintained or improved their margins. “Outsiders looking to enter an industry now in a ‘golden age’ will need to carefully choose their investments. Those already inside need to closely track industry direction and competitor moves to ensure they manage the risks adequately to position themselves to prosper.”
in brief Rabobank appointment RABOBANK HAS appointed Luke Chandler general manager of its food and agribusiness research and advisory division in New Zealand and Australia. Chandler has returned from a three-year posting in Rabobank’s London office, establishing and heading the bank’s global agri-commodity markets research team, to take on the new appointment. He will also retain his international role as global head of agri-commodity markets research, responsible for managing analysis and outlook for the world’s major agri-commodities markets. Rabobank executive wholesale banking Paul Beiboer says Chandler’s hybrid local/international role is “a reflection of how highly Luke’s expertise in food and agricultural commodities markets is valued by Rabobank throughout the world”. “We are fortunate to have someone of Luke’s experience in, and knowledge of, global soft commodities markets to run our local food and agri-markets research and advisory team. “His continuing central involvement in international agri-commodities markets, combined with his strong local knowledge, adds even further to the strength of expertise in food and agriculture that Rabobank is able to provide clients in New Zealand and Australia.” Rabobank is one of New Zealand and Australia’s largest rural banks and a major provider of corporate financial services to the region’s food and agribusiness sector.
Dairy News february 14, 2012
agribusiness // 21 Catherine Tait-Jamieson with organic yoghurt and milk produced at the family factory.
Organic milk, yoghurt sets business apart WITH FEW exceptions, dairy farmers around the country supply their milk daily to Fonterra or some other dairy company. Not so Jamie and Catherine Tait-Jamieson who spoke to Peter Burke about their 200ha organic farm on the outskirts of Palmerston North.
Jamiesons produce from their 150 cows is processed by them on their farm into organic yoghurt and milk, and sold to supermarkets around the country. Last year they were in the news over the 20,000 golf balls, that for ten years had strayed onto their property from an adjacent golf course. The issue has now been settled by the Tait-Jamieson’s purchase of the golf course. The fairways and greens once a mecca for golfers will eventually revert to pasture. Dairy farming runs in Jamie’s blood. His greatgrandfather bought the farm in 1942 and Jamie followed in his grandfather’s and father’s footsteps when he began sharemilking there in 1977. By 1980 the farm was operating on biodynamic principles. Before coming to the farm, Jamie had studied science in Wellington and gained a BA (psychology) and later a diploma in dairy technology. He worked for New Zealand Cooperative Dairy Company on the processing floor and in the laboratory and later worked for Walls Ice Cream. Yoghurt he knew nothing about. In 1986, Jamie and Cathy, members of a
six months. But when the family trust running the farm, gained organic certi- dairy company decided to fication and began making close its yoghurt making plant they faced giving the their own yoghurt for sale idea away or going it alone. in supermarkets. Various They chose the latter and other family and outside in 1988 built their own ownership arrangements small factory. existed until last year “We started off small when Jamie and Cathy and kept our quota going finally gained sole ownership of the business called with the milk company for two or three Biofarm. years and remained Today busiin the town ness is good and milk indusJamie says try. In fact every year we bought there has the milk been growth. back from They’ve them when come a long our plant way from the became day in 1986 operable in when they 1988. Howdecided to be ever after a different. couple of “Our years we yoghurt busihanded ness started back our because the quota and town milk used most industry we Attractively designed and branded yoghurt has of our own were supplywell received by milk for ing was going to been consumers. yoghurt be deregulated production. What surplus and eventually abolished. There was no possibility of we had we sold back to the company.” Today all the obtaining sufficient land milk produced on the farm within the city boundary to expand, given the prices is used for their yoghurt or organic milk. paid by the dairy industry Although Jamie had at the time,” says Jamie. worked in the dairy indusThey knew nothing about making yoghurt and try, he admits to zero experience in yoghurt so got the milk company making. But he and Cathy to make it for them for
learned quickly and soon developed a quality product snapped up by supermarkets. While Jamie focuses on the farm and ‘crafting’ each batch of yoghurt, Cathy, also from a farming background, focuses on marketing and promotion. In 1997, she won the Overall Excellence in Business Award in the Maori Woman’s Business Awards. Biofarm has also been a finalist in the Manawatu Business Awards. Today they produce 750,000-800,000L of yoghurt each year, packed in attractively designed, branded containers. Flavours include bush honey, wild apple and natural. As well as the cows, the Tait-Jamiesons have a flock of 300 polled Dysdale sheep and 400 meat goats on their property. But it’s the yoghurt and organic milk that has given them the public profile. They remain passionately dedicated to their organic farming principle and determined to ensure another generation carries on from them. By their own admission they are outside the square, but given what they have achieved by hard work and determination, their square is remarkable. www.biofarm.com
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Dairy News february 14, 2012
22 // management
Cropping cost control serves David Lister won the Canterbury section of the 2011 Red Sky Dairy Business of the Year Award with a return on investment of 9.2%, and was only just pipped for the national title. Andrew Swallow reports SIMPLE RULES and precision pasture management make David Lister’s 147ha dairy farm near Temuka one of the most profitable in the country, and he’s got the award to prove it. Lister last year won the Canterbury region of the Dairy Business of the Year competition, and was only just pipped to the national title by fellow Cantabs the Davie-Martins, Culverden. His return on investment was 9.2%; theirs was 9.4%; the next closest finalist was on 7.4%. How did he do it? Last month a DairyNZ discussion group from Fairlie, about 80km inland from Lister’s property, visited him to gain insight.
Farm facts Stock: 551 cows on 143ha Production: 1735kgMS/ha; 450kgMS/cow ■■ Costs: $3.41/kgMS; $754/cow ■■ Profit: $4,884/ha, a 43% operating profit margin. ■■ Pasture harvested: 17tDM/ha. All figures for 2009-10 season as per www.dboycomp.com ■■ ■■
He set the scene explaining how he’d come to lease and in due course buy a share of the farm from his father and grandfather, then, after some 17 years of cropping, converted it to dairy in 2006. “I looked at all the options before going into dairy and it wasn’t cutand-dried. The payout forecast was only $4.70/
kg or so and it was two years before we got the big payout, so it was risky enough.” With Lister working full-time on the farm the predicted profit was $55,000. “So it was touchand-go, but that was still a lot more than cropping.” That’s despite the dairy development saddling the business with a lot more
Devil for detail: David Lister explains his pasture management to the discussion group.
debt than it had as a cropping farm, he notes. His first year’s payout came in at $4.46/kgMS. Then came the thenrecord $7.90/kgMS in 2007/8. “That really set
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us up.” But as few who were farming in 2008/9 will need reminding, from an opening forecast of $7/ kgMS, they ended up with $5.21/kgMS and the sobering forecast for 2009/10 of $4.55/kgMS. That was the year Lister took on managing the farm himself. “For the first three seasons I had a manager here, and I was the boy. I did what the manager told me, even when I didn’t agree. I
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from a 1600kgMS/ha farm to 1750kgMS/ha farm,” Lister told the discussion group. “Our grass samples come back at 12.5MJ of ME when I know others around here are feeding 11 ME grass.” Target grazing cover is 2800 to 3000kgDM/ha. “After 3000kgDM/ha that paddock has a question mark over it and will probably go for baleage. I give myself two days, then ring up [the contractor].”
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just filed it away.” That looking and learning paid off. In his first season he lifted output nearly 10% to 448kgMS. Meticulous pasture management, taking covers down to 1500kgDM/ha without failing to ensure quality regrowth, while never letting cows go hungry, drove the lift, rather than any extra input. “Putting the farm on a knife edge has lifted this
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Dairy News february 14, 2012
management // 23
convert well Where paddocks haven’t been taken down to 1500kgDM/ha, the cows go back in the evening to clear it up. “Never during the day... milking them just makes them peckish enough to graze it down.” Even when a paddock has been cleared, the cows coming out of the shed don’t get a fresh break until the whole herd is there. “We move them as one. Otherwise the first ones back from the shed take the top off, then sit down and have a big sleep leaving the ones coming at the back to clear up.” Consequently, all cows are trained to eat down to 1500kgDM/ha, he argues. Reseeding damaged patches of pasture is done with his own direct drill, if necessary using hot wire fences to keep cows off for one or two rounds until the new grass has taken. “We don’t take whole paddocks out of the round.” Chicory, besides providing great grazing, is added to the seed mix at 1kg/ha so its tap root works as natural subsoiler. “We get about three years out of it. The cows always eat the chicory first.” The plough only comes out if a paddock is “so rough we can’t get the fertiliser spreader in.” Nitrogen goes on as 75kg/ha of urea once soil temperature is 9oC in spring. The following round it will get 65-75kg/ ha depending on appearance. “It sets up the tillers we’re going to need later in the season. Then we pull back the nitrogen over Christmas and new year once those plants are established.”
Chicory is sown as a soil conditioner and the cow’s favourite food.
Protecting pasture quality TO PROTECT pastures in wet weather on the low-lying, Wakanui soil farm, Lister on-off grazes. “Typically we’d do it 10 or 12 days a year. They’re on for two hours, just enough to get their needs, then off for 10 hours.” His stand-off block is a small, twitch infested paddock with a mat of rhizomes so thick “it’s three days before they make any mud in there.” The manure deposited “just makes it stronger for next season. It’s an absolute carpet; a blanket. I reckon the twitch mops up all the nutrients and it’s a better stand-off paddock because of it.” PKE and top quality silage is offered on the pad to maintain production.
His most productive pastures are his fescues, which were seed crops for five years prior to going dairy. “So they’re old pastures.” Despite that “they come up faster in the wedge so have a shorter return time.... If the whole farm was in fescue I’d have five cows/ha.” The downside is fescue is hard and slow to establish, and very tender initially, he points out. Lister says “a lot of Lincoln University Dairy Farm farm walks” and regular scrutiny of its website helped him develop his pasture management skills.
“I was always thinking ‘what are they doing and why are they doing it?’ Can we do the same things here?” While Lincoln has moved on to its ‘precision dairy’ programme with slightly higher residuals this season, he’s sticking to Lincoln’s previously tried and tested formula. Where his system differs is in-shed grain feeding at the shoulders of the season. “I usually buy about 200t of barley and 90t of PKE. This season we’ve used 60t of barley and 20t of PKE so we’re well below what we normally use.” It’s also his “safety net”
for putting the farm on the knife-edge in respect of pasture cover carried. But with such high quality grass, grain is considered “no better than grass except for when we get growth rates over 85kgDM/ha/day.” The problem with such fast-growth grass is its bulk and water content. What appears to be a 3000kgDM/ha cover on the plate meter may only be 2500kgDM/ha, and there’s only so much space for feed in a cow’s stomach. “If you can get a kilogramme of grain in it does lift the total ME you can get in there.”
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YEARS OF striving to make a return in cropping served him well for becoming a dairy farmer, says Lister. “When it comes to doing things cheap I’m there. That’s a carryover from being a cropping farmer: we had to be like that.” He’s also a dab hand at fixing things mechanical, and buildings, for example, his calf shed. “A Ukranian and I built it one winter.” Half the shed frames were recycled from a disused and damaged building on his father’s farm, the other half built by a local engineer to match. The tin from the old shed was rerolled and re-used, and Lister laser-levelled the building’s footings using his old contract Homebuilt: Lister’s calf rearing and general purpose shed. drain-laying equipment.
Habit of doing things cheap
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Dairy News february 14, 2012
24 // management
Watching the weather to keep ponds low SAM FISHER
the country are making great strides improving the quality of their dairy effluent ponds as they balance the demands of farms
and growth. Now the message this summer is, empty your storage ponds when you can. The response is positive to DairyNZ’s message to keep effluent storage ponds low in the lead-up to autumn; many farmers
have effluent pond management as part of their daily and weekly farm routines. Concerted effort by DairyNZ, farmers, and other partner organisations has raised awareness of the importance of well maintained and constructed ponds – to the profitability of the farm and the sustainability of the environment. Theresa Wilson, DairyNZ’s development project manager for effluent, says their promotion work is successful; increasingly farmers are seeing a well-designed and managed effluent system as an investment in their farm. “We know dairy farmers see effluent management systems as important to their whole farming system. When the system is correctly designed and operated it will comply with all the right regional council requirements and the whole system will work more efficiently. If there’s any doubt what is needed DairyNZ has advisors and resources online to help get it right.” DairyNZ advises farmers the next step is to ensure effluent storage ponds are kept low and the effluent removed regularly when conditions allow. A well managed pond reduces the risk of running out of storage and saves money on fertiliser. “Even the best effluent ponds won’t cope if they are full and sustain wetweather hits when autumn arrives. The best way to ensure your pond can cope is to empty it regularly and make sure it’s well maintained,” says Wilson. “Farmers are familiar with their farms, with the systems in place and with the equipment, but things can get busy and it can be easy to put off irrigating and emptying the pond. You never know when suddenly you won’t have the time to do it.” The easiest way to stay on top of pond levels is to keep an eye on the conditions. By getting to know what the weather is doing as far ahead as possible with current forecasting, and knowing the level of your storage pond, you
can avoid being caught out with a flooded pond when a storm blows in. Wilson says farmers need to be mindful of weather conditions and their effect on effluent management. “Farmers are good at anticipating weather conditions. But the impact of weather on effluent storage is not always top of mind.” DairyNZ environmental specialist Logan Bowler, who advises farmers in the lower North Island and Hawke’s Bay, says sudden storms can be a big hit. “Sudden rain fronts can put a real strain on effluent storage ponds. You must be prepared for adverse events, but there are times when even a moderate rain can appear suddenly and push a normally compliant farm system to the limits; if a pond is full, a sudden 50mm rainfall can spell action stations. “I tell farmers, sharemilkers, and farm staff ‘you need to irrigate when conditions allow from midsummer through to early autumn’. Then, when the wet weather starts, there is as much free storage as possible in the pond to help people cope. A full pond means you have no storage. We all know regular irrigation gets the ‘green gold’ into the fields and helps grass and crop growth.” Farmers have made good progress meeting effluent management requirements. Nationally the rate of serious noncompliance fell to 11% last season but DairyNZ says though it’s clear the bar is high, any non-compliance is unacceptable. “We don’t want farmers caught out because their ponds were full,” Wilson says. “Irrigating onto a wet paddock with the threat of rain overhead in the last days of milking before drying off is not great nutrient management either. “The best advice is use your opportunities and keep the pond as low as possible. We want our farmers to help themselves by getting ponds ready; we don’t want good farmers caught out. The best advice is keep it low.”
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Dairy News february 14, 2012
26 // management
Bio farmer not looking back TONY HOPKINSON
RATED BY some among the top farmers in New Zealand, Kevin Davidson and his wife Linda run a large enterprise at Onga Onga, Hawkes Bay. They have been on the
property 12 years after leaving the sharemilking path in Matamata/Morrinsville area. Kevin, an electrician who always wanted to be a dairy farmer, hails from Auckland; Linda is from Kaiaua. The farm, t/a Plantation Road Dairies, is a
“My aim is to produce one million kgMS and we are not far off.” large enterprise of 454ha (eff.) for the milking platform and 230ha (eff.) of support land, all flat. With large pivot irrigators,
94% of the dairy farm and 50% of the support land is irrigated with water from the Waipawa River on one of the farm boundaries.
At the peak of the season 1800 Friesian cows are milked daily through the 60-bail rotary; in winter at least 1000 cows are milked daily. The rotary has a computerised milking plant with automatic cup removers. Milking stock
are run in three herds and the last paddock is 2.4km from the dairy shed. Fulltime staff number 13, including two mechanics/ handymen who also look after fertiliser application and ground cultivation. Best production from the farm has been nearly one million kgMS.
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“My aim is to produce one million kgMS and we are not far off,” says Davidson. “With my electrician background our irrigation pumps are all at low pressure, no more than 60 psi, so there is less wear and tear on the pumps and the electricity bill is reduced.” He made other alterations so the water droplets are larger and spray is reduced so irrigation can be done during windy weather. Water for stock and dairy shed come from two artesian bores in the middle of the farm. The cows year-round get supplementary feed on pads adjacent to the dairy. He grows 80ha of maize and 72ha of whole crop for silage, plus a little grass silage. And there is waste from vegetable and fruit processing plants and by-products from grain plants. All are sourced locally. Other minerals and PKE are added when needed. About six years ago Davidson became dissatisfied with the progress and the results he was getting and started doing trials on fertilisers and supplementary feeding. Then five years ago he met Jim McMillan who had launched Outgro, Dannevirke, flying on fertiliser
mixes in slurry form and getting better results. “I felt a comingtogether of like minds; the result was I have been totally involved with Outgro for three years.” The farm is divided into five distinct areas. Each has an annual soil test and herbage tests every two months and they can receive up to six applications annually. “These are generally heavier applications during the year and lighter in the winter due to our wet soils.” He only flies the material onto crops and wetter soils. Most of the fertiliser is delivered to the farm by bulk tankers to his holding tanks and spread by his own tanker with scales and agitators. Mixes can include guano, sulphate of ammonia, calcium nitrate, fine lime, seaweed extract, sugar in the form of molasses, humates and trace minerals. The results: production increases from the more palatable pastures and better utilisation of that pasture. There is more nutrient density in the pasture and Bricks tests show sugar levels have increased 500% above the conventional system. Davidson has seen a big drop in metabolic problems. He is using 80% less nitrogen and 95% less phosphate and believes worm activity in the soil has increased by “at least 300%.” He has not worm drenched any young stock for three years. He adds that the soils are freer draining, there is less compaction and the carbon levels have increased. “I am producing top quality milk and the system ticks all the boxes.” He believes that the Hawkes Bay is leading New Zealand in biological farming. His property has total traceability with all historical treatments and daily production from each paddock being recorded.
Milk is money, more to the point — it’s your money. That’s why Herd Testing is so important, without the data from regular scheduled herd tests you can’t get the most out of MINDA Milk. It means you can’t get the most out of your herd, you can’t get the most out of your farm, and ultimately, you don’t get the maximum beneﬁt from all your hard work. Arrange your herd test by calling your local Customer Relationship Manager, and access MINDA Milk at MINDA Home. It’s the most important ﬁrst step to maximising your productivity.
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Dairy News february 14, 2012
28 // management
Nutrient losses wash away profits peter burke
is just losing money. That was one of the key messages from Southland dairy farmer Vaughan Templeton speaking at last week’s Fertiliser and Lime Research Centre conference at Massey University.
He and wife Megan run 905 crossbred cows on their 425ha farm near Riverton in western Southland. Just over 100 years ago his grandfather was using the land to grow flax to make ropes and twine but the flax mill closed in 1972 and it became an extensive sheep and beef property. The Templeton’s
“You’ve got to know how much grass you’re growing. That’s your number one driver.” moved onto the property in 1988 and converted to dairying in 2002. Having got the farm up and running, Vaughan has made a strategic decision to focus on nutrient man-
agement best practice. As he sees it, nutrients are worth dollars. “I’ve got to keep those nutrients in the rooting zone to grow the grass to feed my cows and hopefully put most
of them back on the paddocks to make a profit. It’s nothing radical, it’s just good farm management,” he says. For Vaughan the reason he’s gone down this track is purely but surprisingly, the environmental gains on the farm have been significant. He’s does an annual soil test
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and each week monitors his pasture growth. “You’ve got to know how much grass you’re growing. That’s your number one driver of profit,” he says. He also points to the cost of fertiliser and says it’s too expensive to waste and predicts over time it’ll become very expensive. Vaughan has also expanded his effluent area to 100ha using a low rate application system. He says a lot of farmers are very open to the ideas that he’s developed and says some are doing even smarter things. But there are reasons why other farmers are not following suit. Templeton says this includes not understanding the potential gains from nutrient management and the lack of understanding of the tool Overseer and the variability between the Overseer and soil testing results. He also says there is a lack of tools to show farmers the movement of nutrients around the farm. “The other gap is around the knowledge relating to nutrient loss on winter crops in Southland,” he says. Another benefit of his strategy is that he’s keeping ahead of the regulators, such as the regional council. “I think a smart person tries to keep ahead of the regulations. I also try to work with the regulators
to ensure that what they are proposing doesn’t have an unintended consequence, which is a massive challenge. “I have no doubt what they want to achieve and I share their goals because I don’t want to see nutrients in the waterways – it’s just losing money,” he says. Templeton says often councils come up with solutions that simply wouldn’t work and could have a huge negative effect on farm profitably or productivity – hence the need to work with them. Another challenge Templeton is facing on his farm is the banks of steams that he’s fenced off are collapsing. He says there’s long grass with a very weak root system under it and when floods come through they tend to erode the banks badly and lots of sediment gets into the waterways. “Banks slump and I lose some of my paddocks. It’s very frustrating You’ve got to fence the streams off for cattle, there’s no question about that. “I’ve been told that closely cropped grass under sheep management will create a bank that is very resistant to getting eroded by water so we’ve got to figure out new ways of managing that pasture inside the fenced off areas,” he says. One way might be to shape the banks better to avoid the problem. As for the future Templeton intends to refine his nutrient management plan. He’s looking to ‘micro manage’ nutrient movement around the farm and even within paddocks. He’s also hoping that the new version of Overseer will provide more detail and solutions to his particular farm.
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RURAL LAND holders in three areas totalling around 900ha on the outskirts of New Plymouth are being invited to join a possum control scheme that already covers almost all the Taranaki ring plain. The Taranaki Regional Council wants to extend its Self-Help Possum Control Programme to about 160 properties south and east of the city, stretching from the coast north of Omata to Mangorei Rd.
Dairy News february 14, 2012
animal health // 29
Tackling FE during the high risk months gwyn verkerk
FACIAL ECZEMA (FE) occurs when
grazing animals eat pasture containing large numbers of spores from the fungus Pithomyces chartarum. They contain sporidesmin, a toxin which causes inflammation of the liver and bile ducts. The damage is incremental, and disease occurs both from short-term ingestion of pasture with high spore counts and long-term ingestion of pasture with more moderate spore counts. While the cow’s liver has some capacity to heal and regenerate, there is often long-term compromise of its function. One immediate effect of exposure to sporidesmin is a drop in production and there may be transient diarrhoea. The toxin is concentrated in bile where it generates free oxygen radicals (superoxides) which cause massive cellular damage especially in the bile ducts. This damage blocks the flow of bile, allowing the light-reactive substance phytopor-
phyrin (also known as phylloerythrin) to accumulate in blood and tissue fluids making the animal photosensitive. Phytoporphyrin is produced during microbial fermentation of the green plant pigment chlorophyll in the rumen
break down and blood pigments will stain the urine red (red water). Sporidesmin is also excreted through the kidneys and can cause cystitis and frequent urination. Only about 10% of affected animals
“Spore numbers increased in summer and autumn; January to May are the high risk months.” but is cleared through the bile when liver function is normal. When it accumulates, if lightly pigmented skin is exposed to sunlight, the resulting deep tissue burns to produce the characteristic skin lesions of FE. This disease process has a time lag, so skin lesions do not become evident until 10-14 days after spore ingestion. Severe skin lesions do not heal well, and cows may develop ‘skin horns’ on affected areas. Sometimes the toxin causes circulating red blood cells to
show clinical signs: for every clinical case there will be 10 cows with sub-clinical FE4. The extent of subclinical disease can be monitored by measuring levels of gamma glutamyl transferase (GGT) in blood which is closely correlated with the amount of liver damage. Levels of 250 IU/L indicate moderate damage. Sub-clinical FE cows may show clinical signs after cumulative doses of toxin, or they may lose production and body condition, be unable to regain condition after drying off, or suffer
liver failure and “spring eczema” (photosensitisation signs) early in the subsequent season. Predicting risk Spore numbers increase in summer and autumn; January to May are the high-risk months. Conditions are favourable for spore production when overnight minimum grass temperatures stay at or above 12°C over four consecutive nights, and humidity is high, e.g. with drizzly rain (4-6 mm/48h), or when soil is kept moist by irrigation. In natural outbreaks, spore counts usually show one or two small increases over several weeks, followed by a major rapid rise when the right weather conditions occur. Given that young spores contain more toxin, pastures are more toxic when conditions promote rapid fungal growth. Conditions for spore growth are also conducive to pasture growth: the amount of dead plant material in
the base of the pasture increases, providing an ideal environment for spore production. Making animals graze into the pasture base adds to the risk. The risk of exposure to the toxin is traditionally predicted by counting spores, which look like microscopic hand grenades, in pasture washings. This gives a useful prediction of risk, but there are two caveats: 1) fungal growth does not occur evenly across a farm, or indeed across a paddock. Counts may be higher in ‘hot spots’ such as sheltered to page 31
“The higher cell counts were starting to limit my options.” Chris Young, who sharemilks close to 700 Freisians and Freisian crosses in South Taranaki, had never had milk graded for SCCs. But as his herd had grown, and there’d been small changes in milking practice, he’d noticed an overall increase in cell counts. Towards dry off, he was becoming uncomfortable with how high the SCCs were getting. “It was starting to limit my options. I couldn’t just go to once a day at the end of the season.” After consultation with his vet, Chris opted for whole-herd treatment, with Cepravin®. It has certainly paid off, in terms of less mastitis and better milk quality. Says Chris, “Our BTSCC is 100,000 less than the same time last October.” Boosting your dairy profits could be as simple as re-thinking how you manage mastitis. See the gains other farmers have achieved at www.milkingit.co.nz
Talk to your vet today about Cepravin. New Zealand’s No. 1 dry cow therapy.
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Dairy News february 14, 2012
animal health // 31
Keeping spores away SPRAYING PASTURE with a fungicide that kills fungus and inhibits FE spore production is the only direct means to manage spore numbers during risk periods. Fungicidal sprays provide a secondary benefit by controlling rust on ryegrass and also give opportunity to apply broad-leaf herbicides to improve pasture quality. Carbendazim-basedsprays, with nil milk with-holding periods, are marketed by several companies. Their performance will generally be similar provided a surfactant is included in the spray to aid spread over the sward and litter, and protect against rain. If heavy rain (more than 25 mm/24 h) occurs within three days of application, pasture should be resprayed. One supplier says its surfactant protects from rain up to three hours beyond application.
Applications should include areas along fence-lines and under trees and hedges, so aerial spraying may require some land-based follow-up to manage these potential hot-spots. Carbendazim sprays are toxic to aquatic organisms, so care must be taken to avoid contamination of water bodies. Best protection is achieved when stock graze pasture 7-10 days after spraying, so control by pasture spraying should be done in anticipation of the danger period, i.e. before pasture spore counts exceed 20,000/g pasture. Ongoing pasture spore counts are recommended to monitor conditions. Depending on location and risk it may be possible to spray only part of the farm so that safe pasture is available when needed. Farms with a high risk of FE
should coordinate paddock rotation with the spray programme so that grazing blocks are treated every 14-21 days while risk remains high. A single application (with surfactant) is reported to reduce spore counts for up to six weeks, but field observations suggest protection may be only three-four weeks if weather conditions favour fungal growth. Spore counts should, therefore, be done before grazing to determine if the pasture is still safe. Integration of the spray programme with grazing rotation can be problematic, especially if the risk is ongoing for several months, and alternative safe forages and crops should also be considered as a means to reduce spore intakes. The effect of pasture spraying where spore counts are already high (>200,000 /g pasture) has not
been well researched. In these situations pastures will remain toxic until existing spores have leached out, but further spore production will be reduced 24 hours after spraying. This may provide a management option in emergency situations, but cows will still be exposed to sporidesmin. Other pasture management approaches The fungus is saprophytic, growing on dead plant material, so pasture with a lot of debris has higher counts. This has led to the commonly-held view that topping pastures will increase the risk of spore growth. Early efforts to manage FE focussed on pasture management and topping was thought to increase risk for lambs. • Article sourced from DairyNZ Technical Series February 2012.
Time to tackle facial eczema from page 29
hollows, alongside hedges, and on north-facing slopes of hills; 2) the toxin will leach as spores age, a process accelerated by heavy rain, so counts may over-predict risk. While district counts can be used as a general guide, spore counts for individual paddocks are needed to predict risk accurately. The general recommendation is that preventative treatments begin before pasture spore counts rise above 20,000/g pasture. Counts of 40,000/g or more should be considered toxic and control mea-
sures will be required to limit liver damage. Laboratories and veterinary clinics have established processes to collate pasture spore count information over summer and autumn. This information is readily available from veterinary clinics and websites such as www.gribblesvets. co.nz and describes district trends. Local variations can be large however, and farms with a history of FE outbreaks should do their own monitoring. • Gwyn Verkerk is a Dairy NZ senior scientist.
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Dairy News february 14, 2012
32 // animal health
Mobile tipping crush popular RICK BAYNE
Bill Morgan trims hooves in comfort thanks to The Vet Group’s new tipping crush.
A NEW mobile hydraulic tipping crush is revolutionising hoof trimming of cows and bulls, and infus-
ing teat seal in heifers, in south-west Victoria, Australia. The Vet Group has introduced the imported Riley Tipper Crush and local farmers are unani-
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mously impressed by its ability to make the job easier. There are only a handful of the crushes in Australia and this is the only one based in southwest Victoria. The Vet Group is using the tipper to simplify its hoof trimming service and expand its heifer teat sealing program. Bill Morgan, The Vet Group, says the hydraulic tipper is safe and comfortable for animals and vets. “It is like a normal crush but when the animal walks in its head is secured and the hydraulic hoist tips it on its side. The legs are secured and it gives us good access at hip height to its feet.” Morgan says the equipment, made in the US, is a new design which improved occupational, health and safety on farms and made it easier to address lameness, one of the region’s biggest animal health problems. “Many farms don’t have suitable livestock handling facilities so this has a lot of value for everyone. The tipper crush holds them firmly but comfortably. As
soon as the cow is secured in the tipper it lies quietly. “Lameness is one of the big animal health issues in our region and there is a big demand for services, so to make it easier and safer is a great bonus.” While hoof trimming is the main use of the tipper, it is also being used for teat sealing procedures. Morgan says teat sealing is growing in popularity and working well in the prevention of mastitis. “It effectively puts a plug in the teat and stops the entry of bacteria at the point of calving. It is an important initiative for milk quality and from an animal welfare perspective.” Trials show the benefits of putting a teat seal into heifers, he says. “We infuse the teat seal about 30 days before calving. “The use of a teat seal on heifers is quite revolutionary in the impact it has on mastitis at calving.” Morgan says farmers are impressed by the new tipper machine. “They are impressed with it and can see the benefits.”
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in brief Auckland TB free CATTLE HERDS in the Auckland region are again free of bovine TB now that an infected property on the Awhitu Peninsula has been cleared of the disease. TBfree Auckland Committee Chairman Keith Kelly thanked the herd owner and local community possum control scheme for their cooperation in clearing TB from the property and ensuring there was no risk of the disease spreading across the region. “In this case, all stock purchases were fully compliant. However, we remind herdowners receiving stock to be mindful of the risks of introducing TB into their own herd.”
Dairy News february 14, 2012
animal health // 33 Balanced trace element formulation
Seaweed concentrate enriched
Detecting mastitis early pays off in milk during milking. It can be easily installed in the long milk tube, and is designed to give a clear view of any clots on the screen. It also picks up dirt, straw or other detritus which helps encourage improved teat preparation prior to milking. Provided the detector is kept clean, it should not interfere with vacuum stability or milk flow during milking. Each detector must be checked after every cow is milked. If clots are present, the cow should immediately be examined for clinical mastitis and treated accordingly. For more information on the Ambic Vision 2000 in-line milk detector and improved milk hygiene, visit www.dairybestpractice. co.nz or talk to your local rural retailer.
Dairy hygiene innovation DAIRY HYGIENE company
Ecolab has launched Ecolab Concentrated Acids, meeting the challenge of handling large detergent volumes. The challenge was two-fold: handling and environmentally ‘friendliness’. Three concentrates are offered: Optimum2 Concentrate combines sanitising (free of quaternary ammonium compounds), with a mix of organic and inorganic acids that enhance detergency. It works over a wide range of water conditions. Optimum Concentrate is a high-performance, acidic detergent sanitiser for cleaning milking equipment, especially difficult-to-clean installations. Klenz All-Temp Concentrate is a highperformance acid detergent QAC sanitiser for routine cleaning of stainless steel milking machines and farm vats.
Ecolab says it has worked to remove water from the formulations. “This has resulted in using less water and energy during manufacturing, and less fuel when you transport the product back to your farm. “The concentrated formula also means dairy farmers will handle 50% less product when manually dispensing. For example, 75ml vs 150ml per 100L of wash solution. This will give greater control when carrying product to the wash tub.” Ecolab is also introducing a new 100L drum, “easier to manoeuvre while also having a smaller footprint. The drum footprint is reduced from 580mm to 380mm, taking up less space in farm dairies.” Tel. North Island 0508 732 733, South Island 0508 737 343
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risk of cross infection within the herd by limiting the amount of bacteria that contaminate the cups used to milk infected cows; cell counts will reduced faster, and there will be fewer repeat cases of clinical mastitis.” New Zealand cows are not usually stripped before milking, nor is there typically a great deal of teat preparation prior to cups on. Milking staff are thus a key resource in spotting signs of clinical mastitis, Skellerup says. In-line milk detectors such as Skellerup’s Ambic Vision 2000 effectively identify cows with clinical mastitis. Such equipment, along with appropriate staff training and procedures, will optimise mastitis control. The Vision 2000 is a simple, effective device for identifying mastitis clots
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ONE OF the most effective ways to control clinical mastitis in the milking herd is to identify infected cows early, so they can be treated before the disease is spread to other animals, says equipment manufacturer Skellerup. Early, accurate detection offers a raft of benefits for cows, staff and a farm’s bottom line, the company says. “The sooner you know which cows are infected, the sooner you can implement appropriate treatment, and the faster infected cows will be able to return to normal milk production. “A good clinical mastitis detection system also stops infected milk going into the bulk supply, protecting your bulk tank cell count and bactoscan readings. “You will reduce the
Dairy News february 14, 2012
34 // animal health
Funding vital in TB campaign
When funding was pulled from wild animal control in the late 1970s, many of New Zealand’s cattle and deer herds fell foul of TB, says Animal Health Board chairman John Dalziell, in the introduction to the board’s Making TB History. This extract from the booklet tells one farmer’s story.
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IN SOME ways, the pioneering days never ended in Buller. John O’Connor was schooled in Nelson before coming here in 1945 to break in a block already rejected for soldier settlement. “I realise now why it was rejected,” he says. Whatever he knew about farming he’d picked up from childhood observation. He lost 30 head of stock in one of the West Coast’s legendary torrents, but got back to clearing the bush and sowing grass as soon as the waters abated. In 1952, he milked cows by hand for eight months until he built the first pipe and bale walk-through cow shed in the area, to milk 100 cows. O’Connor was convinced – against almost all prevailing opinion – that dairying held the key to the West Coast’s future and he devoted his life to making it happen. Nature had only made farming difficult here, but in 1950, it was about to threaten its very existence. Livestock officers began testing town milk cows for the presence of bovine TB – and they found it in O’Connor’s herd. “It was devastating. My father had given me 25 head of stock to start off and we’d built them into a brilliant herd of cows. In the finish, we lost most of them, and their offspring, to TB. One of the biggest disasters was when we sent four cows to my brother’s in Nelson for winter milking. They’d tested clear back in Buller, but later, they had a major outbreak of TB in that herd.” He says the disease nearly annihilated the Buller Dairy Company. “We were just losing production. We went from 400 tonnes of butter down to 280 by the late 1960s. Those years were terrible – farms were running out of cows. That’s what crippled us. “Everybody was blaming the way we farmed.” The insult on top of injury was his abiding suspicion that in fact, possums were the real culprit. “But nobody was blaming it on possums in those days. That’s what really got us down. “We had a big battle to get MAF to recognise possums were causing it. It took us three years to convince the powers that be.” By then 90% of Buller farms were infected, and TB had spread into Karamea and Inangahua. Everyone was now in the same boat, and things got political. O’Connor had an abiding grievance with the compensation rates paid to farmers who lost stock to TB. “We were getting £6 a cow, when they were worth between LLL10 and LLL30.” So he took up another fight, campaigning long and hard for fair recompense, which was finally awarded – full market replacement – in the early 1970s. With the possum link officially recognised, the tables finally began to turn on TB. Possum control began with bait stations and traps, then, in the early 70s, the first aerial 1080 operations were mounted in a bid to slow the transmission of the disease. “From then on, our reactor rates started to drop. They laid 1080 behind our farm and I remember the children coming up to the cowshed. They said; ‘Dad, there’s a sick possum down by the road’. I got MAF to come out and pick it up, and it was absolutely riddled with TB.” Within a decade, vector control brought infections down to just three remaining herds in the Buller. The war seemed all but won, which is perhaps why somebody in Wellington decided to scale back funding for TB control. O’Connor watched the disease rebound. He reckons that single cost-saving exercise ended up costing the country at least a billion dollars. Vector control resumed in the late 1980s and, while the West Coast remains a hot spot, TB rates are now down to historical lows.
Dairy News february 14, 2012
farm dairies & equipment // 35
Milk tests up with lobe pump TONY HOPKINSON
in the early spring of the 2011-12 season installed a Corkill Dairy Systems lobe milk pump and immediately had an improvement in his milk solids test. The result was in early December he got a call from Fonterra saying his milk solids test was up 7% on the same time, previous season. The co-op’s tests were slightly down due to the increase in volume but Davidson’s were improving. “I put it down to the installation of the Corkill lobe pump which reduces damage to the milk by not breaking down the protein and butterfat globules.” Davidson believes his biological farming regime is the overall reason for
his better quality milk. Installing the lobe pump was another step to improve his product. Lobe or positive displacement pumps are used in a variety of industries, including food, to handle solids – even olives – without damaging the products. They create on the inlet side expanding volume for the milk to enter and be trapped by the lobes as they rotate. The milk travels around the inside of the casing but not between the lobes, then to the outlet port under pressure. There is no chance of the product being damaged. Corkill can now supply and fit four lobe pumps of various capacities. In the dairy industry these suit the replacement of diaphragm or centrifu-
Kevin Davidson say MS test results gal pumps or they may be have improved with the lobe pump. installed in new systems. In 1991 Steve Corkill produced the Milk Flow, a device to vary the speed of a milk pump depending on milk flow, levelling the flow of milk through the cooler and reducing risk of damage to milk. The Milk Flow is fitted to the lobe pumps to further enhance the treatment of the milk. The lobe pumps are also fitted with a patented device that maintains a safe pressure and prevents the risk of damage to milk coolers. with a lobe pump they “I believe should get at least a 6% that when increase in MS test due farmers to reduced damage to the replace a cenmilk,” says Corkill sales trifugal pump Demonstration model of lobe pump.
manager Vern Coxhead. He also believes the milk quality improves and that it tastes better. “The Corkill Dairy Sys-
tems lobe pump has paid for itself in a short time with the improved MS tests,” says Davidson. Tel. 0800 107 006
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Dairy News february 14, 2012
36 // farm dairies & equipment
Returns match Helwi Tacoma says robotic milking systems require higher capital outlays than traditional systems but they are more productive and provide more information to the farmer.
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KEEN TO discover what future robotic milking has in New Zealand, Dunsandel dairy consultant Helwi Tacoma began doing the sums on such systems, reports robot supplier Lely. “They work technically and were established in Holland when I left in 1991. I was curious to know if they would work economically in New Zealand.” The answer is ‘yes’: Tacoma thinks the new systems will become more common but won’t necessarily suit all farmers. “The main advantage is high cash flow. It’s a big investment with high inputs, high outputs and potentially a high cash flow. It can make you more money if you look at it on a per-cow basis. But the flip side is because more capital is employed the risk is higher than with a conventional system. “The only way to make it work on paper is by achieving higher production. That means a good sized cow – say 600kg body weight – fed concentrates for high production. You will need a couple of kilograms of concentrates per cow per milking.” Cows that get higher
levels of inputs will choose to be milked 2.5 or 3 times a day. The payoff is higher production. The rewards are not just financial, says Tacoma. “A cow person will get a buzz out of getting all this milk out
of cows and seeing them in top condition and in good stock health. That isn’t a financial thing but it feels good.” Most of the world has barn-raised cows, the robots working in the barn. But New Zealand’s pasture regime means robotic systems here are developing differently. Most use rotational grazing and three raceways. Every eight hours the cows go onto a different break alternating between the
three raceways. In one scenario Tacoma compared the cost of robotic milking 500 cows to a standard herringbone shed. Eight robots at a cost of about $2.2 million would be needed to milk a 500-head herd. If the robots were used with pastured cows, a separate milking shed would also be required. This compares to a cost of $800,000 for a standard 40-a-side herringbone.
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Dairy News february 14, 2012
farm dairies & equipment // 37
investment in robotic milking pletely on bought feed when feed prices go up and milk prices go down. Pasture-based farming provides more options, and farms can be set up to grow their own concentrates. In a second scenario Tacoma compared a rotary milking system with robotics, assuming a similar sized farm and similar capital investment. For the same capital input, a farmer would make $400,000 after tax on the conventional system. They would make $350,000 with the robotics but with fewer than half the cows and a lot less work. For the robotic side of the equation, Tacoma looked at 420 barn-raised cows milked with six robots all year round on
To barn or not to barn HELWI TACOMA is comfortable with cows living in barns. “There is a farm in Morven with 16 robots and the cows are inside around the clock. To me they look a picture of happy cows.” He says 90% of cows in the world are raised in barns and New Zealand and Australia are the odd ones out in having mostly pastured dairy cows. “It’s not the indoor living that’s a problem, it’s how people do it. If you’re a bad cow person, you will end up with a mess no matter what system you use. I’ve seen awful things happen on pasture systems, and equally in barns. “There’s nothing wrong with housing cows 24/7, provided it’s done properly with enough feed, light, fresh water, comfortable lying space, room to walk around, and hidey holes to get away from aggressive behaviour by herd mates. “I have an ingrained dislike of people who mistreat animals. Beyond the morality, to mistreat animals isn’t a good business proposition. They just don’t perform. There is no future in mistreating animals.” There are three main ways to keep barn-raised animals: 1) a slatted floor with a cellar underneath, where the animals tread the dung through the slats and the slurry is stored and spread back on pastures; 2) a solid floor with a continuous scraper system gathering up manure and putting it in a sump for spreading; 3) a big heap of compost to which fresh straw, bark or post peelings are added daily and aerated with a rotary hoe. “If done right it’s the ultimate in cow comfort. The pack heats up and kills bugs. It’s not easy to do well, however,” Tacoma says. He thinks barns will become more common here for animal welfare reasons especially in the South Island. They can be used to shelter the cows from bad weather and keep them out of deep mud on break feeds. Barns will also become desirable for environmental reasons. They give farmers complete control over the slurry, which has the added benefit of lower fertiliser bills. Barns also prevent soil damage from animals pugging the ground.
247ha. He compared this to 1050 cows milked seasonally in a 60-bale rotary on 285ha. The rotary shed would make $50,000 more each year though there are two ‘buts’: 1) the robotic farm has 50ha unused that can grow more feed or crops to provide extra income; 2) the rotary carries at least
twice the number of cows and requires a lot more infrastructure. A farmer starting from scratch – buying land, cows and infrastructure with some $ 4 million equity invested – would create about the same debt in both systems, i.e. $8.5m for robotic and $8.7m for the rotary.
Tacoma says he assumed the conventional system would produce 1900kgMS/ha. “Not many people achieve that. Some people do but it’s a pretty high performance. Most people would come back a notch to 1500-1600kgMS/ha so they wouldn’t be getting the financial performance
The future of milking technology starts with
you get from robotics.” He assumes the robotic system can achieve 1850kgMS/ha but from half the number of cows – about 500kgMS from a cow in the rotary but 700kgMS/ cow in the robotic. Tacoma based both systems on a grass-based diet because it’s the most
efficient way to farm. He assumed 45ha of wheat are grown on the robotic farm, and peas or canola are bought in for extra protein. Slurry from the barn is used to fertilise crops. That isn’t available if the cows are pasture-raised; and the farmer would have to buy fertiliser.
IQ – Four-way milking cluster
When it comes to clever ideas for the dairy industry, GEA Farm Technologies have a lot of them, and the new IQ four way milking system is set to revolutionise the way you milk. Its intelligent four way chamber separates milk from each quarter minimising the chance of infection spreading.
The slimmer, more flexible cluster design gives a more comfortable fit whatever breed you’re milking, and ensures the IQ always adheres securely to the teats for quick, stress-free milking. Take your farm into the future with a smarter system – think IQ.
Call us now to find out more about our IQ Cluster, on 0800 657 555. GEA Farm Technologies NZ Ltd Call 0800 657 555 to find your nearest dealer www.gea-farmtechnologies.co.nz
GEA 6625 IQCluster Ad 280x187mm_v2.indd 1
GEA Farm Technologies The right choice.
Everything else is the same for pastured animals – raceways, stock water and fencing. So there is a big difference in set-up costs. But robotics provide a “total farm management system,” Lely points out – more data per cow, per milking and per quarter, and the ability to optimise an operation. Robotic systems depend on concentrates because the cows go through milking for the feed reward. “The operating costs per kgMS are going to be higher, and so are the financing costs. But there are more kgMS rolling out, and the financial outcome can be as good or better than a conventional grazing system.” Tacoma says there is danger in relying com-
27/8/10 9:40:21 AM
Dairy News february 14, 2012
38 // farm dairies & equipment
Cow barns ‘a standard feature’ in south THE ECONOMIC boost to dairying achieved by housing top-performing cows in cold regions points to cow barns becoming a standard feature of the southern landscape, says Advanced Cowbarns Ltd. The company is a joint venture by Winton Engineering Ltd and Southland Concrete Construction Ltd. The company says that the dairy industry’s slim profit margins demand attention to four key factors for long-term viability. These are: Sustainability: the dairy operation must be sustainable within the environment over the longer term. Animal welfare: paramount for maintaining high production and access to international markets. Work environment: must be clean and pleas-
ant to attract and retain top-level staff. Profitability: inputs including feed, staff and fertiliser must be kept to a minimum.
also results in more milk solids. Many clients of Advanced Cowbarns Ltd are said to report that the savings made by the
ably housed at least 13,000 high-performing cows. The company’s sheds are built from hot dipgalvanised steel certified to ANZS 1554 ‘Structural
“Herds wintered in the warmth of a welldesigned and constructed shed consume much less feed and stay in better condition than cows exposed to the cold winter weather in the south.” These factors press a growing demand for wintering sheds for cows, the company says. Herds wintered in the warmth of a well-designed and constructed shed consume much less feed and stay in better condition than cows exposed to the cold winter weather in the south. Being able to extend the milking periods at either end of the season without pasture and soil damage or effluent run-off
extended milking periods alone will pay back the shed investment. With savings on winter feed, animal health, improved cow condition returning better production and less pasture damage, overall returns on shed investments of up to 22% over the costs of other forms of cow wintering in Southland are often recorded. Advanced Cow Barns has to date erected buildings that now comfort-
Steel Fabrication’. Inspection of all welding, galvanising and fabrication is by inspection agency SGS International Ltd to ensure quality materials and workmanship. This standard of testing, inspection and quality assurance has seldom been used in the New Zealand construction industry, the company says. Two standard designs are offered, with free-stall cubicle widths of 33.5m or 36m and stall widths from
Savings made by the extended milking periods alone will pay back the shed investment, the shed builder says.
1100 to 1300mm wide. A third standard shed option suits clients wanting a straw-filled loafing barn. The lengths of these sheds can be varied to suit different cow numbers and internal lane width and stall dimensions can be changed within each design. Three standard
designs, bulk manufacturing, in-house design of automatic effluent scrapers and direct imports of most shed components keeps prices keen, the company says. Cubicle free-stall shed prices start at $1750 per stall and loafing barns from $92/m2. Bedding options include latex mattress and
covers 30, 40 or 50mm deep, rubber matting and dual-chamber cow waterbeds. Advanced Cow Barns does its own concrete work. And it can place all concrete for effluent and silage feed pad systems, cow and tractor lanes. Tel. 027 411 2805 www.cowbarns.co.nz
See Us At The
Sites 493 & 615
HE ASKED FOR IT Andrew Gerritsen: Gore. Herd size 760. Andrew loves his Protrack system almost as much as he loves mud. Unlike his beloved motocross bikes his Protrack system never leaves him stuck, in fact one of the best things about his Protrack system is the time it has freed up for him to ﬁnd new ways to get himself upside down. We don’t know what you will do with the extra time a Protrack system will give you. We just know that you, like Andrew and every other Protrack owner, will ﬁnd better things to do with the time you used to spend in the shed.
To ﬁnd out how Protrack can make your life easier, call 0508 Protrack or contact your LIC Customer Relationship Manager.
Dairy News february 14, 2012
40 // farm dairies & equipment
Robots enable rise in cow numbers chris dingle
IN A remarkable transi-
Australian farmer Robert Henningsen outside the miking shed, which also contains the three Lely Cosmic auto feeders.
tion, Robert Henningsen, Mingpool, via Mt Gambier, South Australia, has gone straight from a ten-a-
side herringbone shed to the largest cluster of robot milking machines in Australia. When Dairy News visited recently he was about to put in the eighth Lely robot and his third in-shed
Cosmix automatic feeder. Henningsen until June 2010 milked 250 cows. Soon he will milk 500 virtually on his own. He looks after all the milk harvesting by himself, with one casual helper coming in three days a week mainly to clean down and move around the milk for the calves. “I’m always here with the heifers but I’m now free to look after the calving and other priorities,” Henningsen says. “I don’t have to put the cups on.” He admits it hasn’t got much easier. “You’re learning what the cows are learning. We are not hands-on, not seeing every cow, so you pay more attention to the computer, particularly in picking up the signs of environmen-
through the units with feed to get them used to it, and allowing the computer’s memory to locate the teats and match them up with each cow’s neckband transponder. Ciavatta and Henningsen say they were surprised at how quickly the cows learnt and accepted the system. Jurgen Steen, Lely Australia’s manager dairy equipment, explained that a milk line configuration unique to Australian dairies is to cater for our seasonal calving system. Under a preventative maintenance schedule each robot is serviced three times per year, and Lely Australia provides a 24 hour support team. Henningsen’s rationale behind this level of
“Trying to get people to work in the dairy was difficult. We had to find a better way.” tal mastitis. I spend more time on the computer than I do in the shed. The more you’re on it, the more you get used to it.” The milking shed is an open affair with a high flexible roof for better light and air flow. Henningsen’s original seven Lely Astronaut robot milkers were commissioned all at the one time in June 2010. This latest installation is the fifteenth Lely robot installed by Dairy Tech South East of Mt Gambier, spread over three local dairies. It’s been a fairly steep learning curve for Lely Australia as well as the dealership and the farmers. Lely Australia dealer principal Rob Ciavatta says the milking process is “absolutely perfect”. “For instance, yesterday the robots milked 1000 cows with just two failed milkings. “Rob Henningsen is our oldest automatic calf feeder customer and has had an exceptional run. He now has two feeders, each with four stations and is feeding 450 calves at any one time.” Training for the robots involved walking the cows
automation was to build herd numbers and individual production levels. The original decision to go for robots was to solve the problem of labour. “Trying to get people to work in the dairy was difficult. We had to find a better way. Plus, instead of having cows standing around busting with milk they can come up any time to be milked.” When he was thinking about the upgrade he went to see Simon Scowen’s five robot milker installation at Kongorong, south west of Mt Gambier. “My main worry was putting the cups on, but it did it efficiently, using lasers to locate the teats. The system realises the full potential for the individual cows. “Grain is fed evenly throughout the day, better for digestion and production. Since we put the system in we had a good year last year getting cows in calf.” The cows can come up any time of the day – as often as they like – to be milked, and can then go to one of the automatic feeders close by the robots in the shed to get their total mixed ration.
Dairy News february 14, 2012
machinery & products // 41
New feed mixer fits regardless MIXED RATION vertical mixers don’t come much more compact than the Kuhn Profile, remarks Kuhn New Zealand. And the size and manoeuvrability of this one means farm size and building configuration do not limit its use. The Kuhn Profile 470-670 comes with capacities 4m3 (model 470) and 6m3 (model 670). The smaller version has an overall height of 2.08m thanks to the position of the axle at rear of the body. The small diameter (1.69m) mixing auger requires only a 40 hp tractor. Features include: Auger gearbox and drive: a product of Kuhn technology, the angle gearbox is of prven reliability, the maker says. The same gearbox is used on 27m3 machines. The mixing auger has the same features as the rest of the range (two double bent scrapers, double pitch at the end of the auger) to quickly calibrate fibrous rations and make a homogeneous mixture. The polygonal body profile concept strengthens the bin structure to reduce deformation. Welded counterframe: two side members welded to the pre-stressed body are positioned along the length of the machine to absorb the strain resulting
from towing. Distribution systems include feeding on the right and/or left hand side with a chute and/or a tilting conveyor. Geometrically symmetrical, i.e. the drawbar and axle can be reversed to distribute feed on the right instead of the left. Available in direct or electric control, the Profile works with the hydraulic systems of any tractor. Counter-knives are standard for fine chopping. Three-point electronic weighing system is standard, either in a simple version or optional programmable version, to simplify power management. Height and width adjustable feed chute on the right and/or left.
Tel. 0800 585 007 www.kuhn.co.nz
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PROUD SPONSORS OF: *$200 . Offer available on any new 4WD Honda ATV. Stock crate available as optional extra with purchase. Cannot be substituted for cash or discount. Kea trailer model K64SF 6’ x 4’. Offer valid from 15 Feb 2012 while stocks last. +GST
Contact your local Honda Dealer on FREEPHONE 0508 466 326. For more information visit our website www.honda-motorcycles.co.nz
Dairy News february 14, 2012
42 // machinery & products
Dairy farmers, you wanted this CLOTHING
MAKER Swazi Apparel Ltd will on March 1 launch Dairy by Swazi, a range specifically for dairy farmers. It is made in New Zealand and will sell exclusively in RD1 stores. Swazi designer and owner Davey Hughes says he is pleased with sales of the company’s premium, “but research told us there was also a segment of farmers who, while concerned about quality, were after clothing with a few less features [and] value for money.” Dairy farmers will be pleased, he says. “By stripping out a few features and added manufacturing efficiency, we’ve delivered a range of products... at a bloody awesome price.” “All the inherent Swazi properties [are there]: durable, the very best of fabrics and craftsmanship.” The range will start with five garments: men’s pants, shirt and two tee-shirts and a women’s skivvy. All garments will be made of fleece, some in different weights.
Tel. 06 368 4822 www.swazi.co.nz
Swazi proprietor Davey Hughes wth a bevy of beaut models.
FAST & EFFECTIVE MASTITIS PREVENTION!
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Ambic Vision 2000 An effective in-line device for identifying mastitis clots during milking. Save time and money - See your local Rural Retailer today. Leading Innovation and Value in Dairy
Get started with DIY irrigation WELL KNOWN K-Line irrigation pods, seen on large farms, have until now usually needed the oversight of an irrigation consultant. But now the maker, RX
everything to get irrigation up and running.” The Farm Pack concept
Plastics, has released a DIY irrigation farm pack – “affordable and accessible” to smaller scale farmers. Sales and marketing manager Phil Gatehouse says the new Farm Pack is a logical extension of the K-Line range. “We know there are a lot of smaller properties that would benefit from using K-line irrigation, so we wanted to make it easy to walk into a rural supplies shop and walk out with a pack that contains
is popular with K-Line’s North America customers, and is now sold by rural supplies outlets New Zealand-wide. “Each package is designed to cover 1ha of land and includes five irrigation pods, 100m of 32mm K-pipe, NAAN sprinklers and saddles, and all other necessary components to install a system.” Gatehouse says for bigger blocks, buying two Farm Packs will irrigate
at least 2ha. Buyers need to add to the package a Jet Pump to push water through the system. RX recommends a 0.75kw pump for 1ha and a 1.1kw or 1.5hp Jet Pump for two Farm Pack kits. The pack comes with written instructions and a DVD. Gatehouse says the system also suits sports fields, parks and dust control. K-Line Irrigation has at its ‘heart’ a system of durable pods (each houses and protects one sprinkler) attached to polyethylene K-Pipe that resists kinking, abrasive soils, freezing, UV light and the stresses of moving. These low-pressure systems distribute water with a slow, efficient absorption method that eliminates the need to shift irrigation several times a day. They use less water, more effectively. K-Lines can be shifted by hand or with an ATV or a similar tow vehicle. Tel. 03 307 9081 email@example.com www.rxplastics.co.nz
Dairy News february 14, 2012
machinery & products // 43
Wagon beats baling wagon has proven a good purchase for a Whataroa, Waikato, couple who three seasons ago moved to Waitaha Valley, south of Hokitika, where they now sharemilk. Andrew and Jody Shaw at first farmed 600 cows, feeding them baleage. Then the farm owner approached them about share-milking their property. Now, with the help of five staff, they milk 1100 cows on 520ha and a 100ha run-off. In an operation that size is was impractical to make baleage. “If we made bales it would take forever to feed out and we’d need 3000 bales,” says Andrew.
they go through without damage. “If it stuffs up, it’s something I’ve done wrong,” says Andrew. “The entire chopping head drops down hydraulically at the push of a button, giving easy access to the knives for sharpening. “Every season we make three large stacks around the farm. After every stack, about every 150 tonne, I take them out and sharpen them.” Grease points are easy to get to and in three years that’s all the maintenance that’s been required. The Tigo has an autoloading wall. It keeps the silage well packed in, so every load is at maximum,
Faced with those facts, the Shaws bought a Lely Tigo R40 loader wagon. It’s now onto its third season and has been a great investment. For Andrew it’s important to do his own silage. “We need to do it when we can as the weather gets so wet. If we have three fine days we can get it in that night.” He says the Tigo is a robust machine and he uses it on heavy soils. The R40 model has a 26m3 capacity. There are bigger loaders than it but the ground in Andrew’s paddocks is too wet to take a heavier load. It also has adjustable knives so you can specify how long or short the cut should be. The minimum on the R40 is 45mm and it has a 31-knife 800mm cutting rotor and a five-tine, non-steered pick-up. Andrew says his neighbour has a different brand loader, and it just doesn’t cut as well as the Tigo. He also likes that it is easy to operate and maintain. It can pick up the occasional rock but
and it beeps when it’s full. It has two 10mm chains to empty the load and these are hydraulically driven. For farmers who want to feed directly to barn-raised cows, the loader can be fitted with a conveyer that spills the grass out to the side of the loader, for cows to grab. It’s a very stable machine with a low linkage to the tractor and hydraulic suspension on the drawbar reducing shocks between the tractor and the loader. Lely has also paid close attention to the loader suspension making sure it’s steady whether at road speed or driving in the paddock. Andrew pulls his Tigo R40 with a 190hp New Holland though he thinks he could probably pull it with 115hp. “It’s more power than what I need, but when it’s in wetter ground and sinks, it doesn’t make a mess as the tractor just keeps going.” He says he chose Lely for two reasons. One was the great run he and Jody had from a Lely Welger baler bought in 2001
A LELY Tigo loader
on their previous farm. They also value the Westport dealer they bought it through, Westland Farmers. Tel. 07 850 4050 www.lely.com
Dairy News february 14, 2012
44 // machinery & products
ATV poo scraper a recently launched yard scraper fits an ATV for cleaning smaller areas and confined spaces unsuitable for tractor mounted models. The Junior Moo Loo scraper has a 1400mm blade. It fastens/releases with one pin to the headstock permanently fitted to the ATV. Weight is 40kg. The unit is developed and made by Whatawhata Engineering (2009) Ltd and sold by Heads and Tails Dairy Solutions. “We are developing other products for the headstock such as an electric fence carrier for reels and standards,” says Heads and Tails manager Rex Green. The scraper has a simple lever to raise the blade when reversing and there is a simple chain hitch to hold the blade up when travelling. It can be used for feed pads and cow yards for holding cattle. “It’s ideal for cleaning underpasses where tractors cannot travel. Some farmers leave the blade beside the tunnel for cleaning when needed rather than taking it back to base,” Green says. The scraper is strongly made and the ATV will lose traction if it hits obstacles, rather than bend any part of the scraper. Tel. 027 824 0007
Feed waste all but over A NEW option for Robertson Manufacturing’s Comby range improves feeding out efficiency on the feed pad. This and other equipment will contribute to Robertson’s largest-ever display this week at Southern Field Days, reports spokesman Danny King. The Comby option replaces the tray below the elevator and the maize tray option and extends the elevator underneath the cross floor to eliminate the possibility of any material being dropped. This feature is available as an option on new machines or can be retro fitted to machines built later than 2001.
Also on display will be the company’s patented Transpread twinfloor system on 500 and 700 series trailed fertiliser spreaders. This system has twin floor chains and bar conveyors, and twin drive
Designed and manufactured in New Zealand ...Loved around the world
increased as each drive is sharing the load. The all-new and improved, stronger tip trailer range (6-12 tonnes) has a twin ram system, repositioned to achieve maximum strength and lifting ability. These also have an improved chassis and axle to handle very tough jobs. Last season was the first for the company’s Robertson Storrie ridgers showing “exceptional
gear boxes (one each side) increasing the accuracy of spreading during turns. The wheel on the inside of the turn slows down, slowing down that side conveyor and speeding up the outside wheel and drive, making spreading on corners and bends more accurate. The system also gives the ability to turn off one side, for spreading on narrow strips and tapered runs. Load capacity is
results”. For this season, along with the proven seed and fertiliser ridgers, the company has designed a seed-only machine for planting swedes, etc. And the Robertson scuffler, used in conjunction with the ridger, is a good way to control weeds, aerating the soil to give crops maximum opportunity to yield well. Tel. 03 303 7229 www.robfarm.co.nz
20mm, 25mm and 32mm inlet sizes
Auto Inline Liquid Dispenser
Water Flow Indicator
Dispenses chemicals and minerals into a water supply Check Valve
i s ib
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Reduce water loss Locate leaks with ease Saves time and labour costs Positive indication day and night Easy to install Stainless steel construction Designed and manufactured in NZ
Megaflow™ Trough Valves have been developed especially for filling New Zealand’s dairy cattle drinking troughs. They give high water flow are compact, robust and manufactured from corrosion resistant materials. The convenient Detach™ quick coupling feature makes the Megaflow™ New Zealand’s most user friendly trough valve. If you use Megaflow™ trough valves, thanks for trusting us to keep the water flowing to your herd.
Jobe Valves Ltd, PO Box 17, Matamata P: +64 7 880 9090 E: firstname.lastname@example.org
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Reduces labour costs Easy to install Operates using water flow Any pressure from 10 – 210 PSI Competitively priced Made from high quality materials Designed and manufactured in NZ
Features: • Water driven – no power required • Non-contact indication – no seals to wear • Designed for minimal maintenance • Available in packs of 2, 3 & 5 units Several sizes and mast lengths available
Singh’s Engineering Services 66-68 Mahana Rd, Hamilton, Ph/Fax 07-849 3108 www.setech.co.nz or your local dairy equipment dealer
Dairy News february 14, 2012
machinery & products // 45
Feed trains won’t crash A FEED trailer from Milk Bar will not cut in through gateways, can be safely braked before unhitching, suits many feeds and withstands years of farm use, the maker says. It has all-wheel steering, a split brake system and split troughs. The steering enables you to tow multiple feed trains through gateways with no cutting in. And the split brake system allows the user to apply a park brake before unhitching from the tow vehicle – an essential safety feature. Split troughs give great feeding options, says Milk Bar, e.g. molasses in one and PKE in the other, etc. Troughs are made from polyethelene – strong and durable. A 3-year warranty applies. Tel. 09 432 0771 www.milkbar.co.nz
Dairymen’s vest goes the distance THE ORIGINAL vest is still going strong, says Kouldja Kids, clothing maker. “If you are after a tough reliable high visibility vest, look no further,” says spokeswoman Sue. “These vests will last the distance.” Made from a hard wearing, tear resistant waterproof fabric, they won’t be destroyed easily. “Even if you do manage to put a hole in it, it won’t keep going like many other vests on the market. People are often amazed at how strong the fabric is. We carry a piece of fabric with us to the shows and have seen many a red face trying to rip it.” The fabric speaks for itself, Sue says. “The most [our customers] seem to do to them is bust the odd zip which is replaceable.” The vests are mainly made to order with radio-telephone and cellphone pockets made to suit individual requirements for the different farm/occupations. Off-the-shelf vests come with cellphone or radio-telephone pocket, with pen holders attached. And they have a large breast pocket for a calving book and one for a pocket knife. All top pockets are Velcroed shut – no losing phones in water troughs. All vests are lined. Tel. 0800-568535 www.beingseen.co.nz
Three Milk Bar feed trains coming through a gate – and no cutting in.
Dairy News february 14, 2012
46 // motoring
Friendly face for capable truck Photo: Damien O’Carroll, NZ4WD Magazine
THE SMILING corporate face
of Mazda on the front of a ute makes a bold statement. Not everyone has found it a comfortable mix, the curvy swoops that are Mazda’s signature look melded onto the more traditional profile of a ute, but in the metal it looks good. Different, but good. On the road, the new BT-50 is a revelation. The 3.2L 5-cylinder I5 20-valve turbocharged, intercooled diesel is all torque and nonchalantly throws the Mazda up hills and down straights without raising an eyebrow. Power is a healthy 147kW, maximum torque is 470Nm generated at 1750-2500rpm – right where you want it for off roading and towing – and the fivecylinder growl makes the BT-50
far more interesting than a fourpot diesel. The chassis dynamics of the BT-50 and its close cousin the Ford Ranger have drawn much praise from the motoring press (the mechanically identical Ford was named Autocar magazine’s Car of the Year). The steering is accurate and the chassis, within the limitations of a cart-sprung rear – comfortable and capable in a way most commercial vehicles are not. A spirited drive up Highway 16, between Helensville and Wellsford, took in a mix of straight and winding sections of road, and some indifferent road surfaces, all of which the BT-50 easily took in its stride. It lopes along in the most effortless fashion. Off road it was only stopped by its road-oriented rubber.
Among the many active safety features is hill descent control which will safely ‘walk’ the truck down steep terrain, requiring the driver to do no more than steer. To help it get back up the hill is a diff lock. Tick the automatic gearbox option, as fitted to the Limited test vehicle we drove, and you’ll get the excellent ZF 6-speed automatic. Manual buyers also get six cogs. The higher gearing offers better fuel efficiency when cruising, the claimed average being 9.2L/100km, although Dairy News’ lead-foot driving technique saw consumption closer to 10.5 – still good considering the grunt on tap. The praise heaped on Ford/Mazda’s new ute is largely deserved. Prices for the base 4WD double cab start at $51,295 and stop at $61,895 for the leatherlined Limited.
Side by side in 4x4 FARM UTILITIES new this month include CB Norwood’s CF Moto Z6, a 600cc, fuel-injected side-by-side and a UTV – a utility 4x4 machine with a tipping deck, powered by a 500cc engine. These will be followed soon after by the CF Moto Z8 (an 800cc side-byside) and the X8 (an 800cc agricultural ATV). Established globally as a farm and powersports machine maker, Norwood says, CF Moto came to the New Zealand market in 2010. Its scooters and ATVs have previously been sold here and in Australia
bearing a different name. Now they’re all CF Moto. The firm, based in Hangzhou, China, has made such products for 20 years. It puts 25% of its 1300 workers to research and development. The brand enforces a zero defect policy. It makes 600,000 vehicles annually, selling them in Europe, North and South America, Australia and Africa, as well as in China. CF Moto ATVs/UTV and side-bysides come with automatic CVT (continuous variable transmission) and selectable 2WD/4WD modes with a
low/high range and independent rear suspension. The farm range of ATVs includes a base model 500cc (the X5) at $9500 incl. GST, the soon-to-arrive X8 (800cc power steer) at $14,999, the Rancher 500cc UTV at $13,999 and the new Z6 (600cc EFI) side-by-side at $14,999. All models carry a 1-year factory warranty. Two agricultural/recreational models are the CF Moto Z6 (600cc) and Z8 (800cc) with electric winch, tow hitch and alloy wheels as standard. Tel. 06 356 4920 www.cfmoto.co.nz
Field Days site 461
QUICKFEED FEEDOUT WAGONS For mixing and feeding out at the same time Now available with
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Ph: 03 208 8059 Mob: 027 711 7270
If your cows arenâ€™t taking Zincmax+ they may be aiding and abetting facial eczema. Zincmax+ is a palatable peppermint-flavoured blend of water soluble zinc combined with organic copper, designed for facial eczema treatment in dairy cows. When dosed with high levels of zinc, cows can absorb less copper from their diet. The organic copper in Zincmax+ helps offset this depletive effect and allows stock to maintain healthy copper levels. Zincmax+ is suitable for use in trough and in-line dispensers.
Subject your farm to a thorough examination by calling Altum on 0800 784 674 or visiting www.altum.co.nz Zincmax+ is a registered pursuant of the ACVM Act 1997, No 10457 KingSt10760_DN_A
Working. Together. New Zealand.
New Zealand’s Dairy industry has an international reputation for quality and reliability that is second to none. Throughout history, innovation and technology has helped position NZ
together we build successful farm systems that endure for generations to
Dairying as a world leader. Dairy farmers have played a huge part in
come. It’s combined expertise that supports our clients’ business and the
championing the industry’s success from the introduction of the clover/
farming community and helps grow the country as a whole.
phosphate pastoral system to the early adoption of electric fences to support rotational grazing. And throughout, PGG Wrightson has worked
We know you need results and solutions and with 150 years of local knowledge
with some of the country’s most enterprising Dairy farmers to ensure that
and experience under our belts, PGG Wrightson is right behind you.
Helping grow the country