MACHINERY & PRODUCTS
Changes not all they’re cracked up to be. PAGE 19
Saving the planet one post at a time. PAGE 32
Superstar markets shine for kiwifruit PAGE 16
TO ALL FARMERS, FOR ALL FARMERS JULY 2, 2019: ISSUE 679
Activists’ aerial attack SUDESH KISSUN firstname.lastname@example.org
FARMERS ARE bracing for a major animal rights campaign against their winter grazing practices. Federated Farmers says farmers reported two weeks ago seeing a fixed wing aircraft and a helicopter flying low over stock, apparently filming stock in mud. The dairy industry is worried that the campaign will highlight cows bogged in mud while grazing on winter crops kale and fodder beet. Federated Farmers Southland dairy chairman Hadleigh Germann says he has spoken to farmers who saw the aircraft. He is concerned about the stress and health and safety issues caused to stock and farmers by low flying. “An aircraft hovering over mobs can stress them out; this can lead to breakouts,” he told Rural News. “For farm staff shifting stock this can also be a farm safety issue.” Germann says the flying was two weeks ago but he cannot rule out further activity. “It’s hard to know because farmers and staff are not always on the same property as their stock.” Rural News understands Federated Farmers was tipped off about aerial blitz in early May. The campaign against winter grazing practices is believed to be spearheaded by a Waikato-based businessman. Animal rights groups Fish & Game and Forest & Bird are denying any link to the campaign. Germann urged groups concerned
about animal welfare on farms to talk to Federated Farmers. His main concern is that video footage could be doctored. But he concedes some Southland farmers need to ‘pull up their socks’ when winter grazing stock. “Driving through the region you can see that some farmers are not following best management practice on farm in winter grazing, but it’s a small minority,” he says. “We think farmers in the last couple of years have improved winter grazing practices.” In a joint statement last week, DairyNZ, Federated Farmers and Beef
+ Lamb NZ urged farmers to share the public’s concern about poor winter grazing practices, “knowing that it just takes one photo of bad winter grazing practice to undermine the good work by everyone else”. DairyNZ chief executive Tim Mackle says there are simple winter strategies to help retain nutrients and soil within paddocks and ensure animals get enough lying time. These include fencing off wet areas in the paddock, grazing from the top of a slope so downhill crop can act as a filter, and having a plan for managing animals when wet weather hits, e.g. an
area to stand off stock or a larger grazing area. The statement said while some changes need to be implemented a season ahead, such as paddock and crop selection, others can be used now to minimise pugging and the associated soil disturbance. “Across the sector we’ve been working together and with central and regional government, to review and improve the resources available and update our approach to help farmers improve their winter grazing practices,” Mackle said. • See more on page 4
What problem? Britain’s deputy high commissioner to New Zealand Helen Smith claims the access arrangements Britain and the EU have put to the World Trade Organisation for NZ sheepmeat access post Brexit will cause no alteration to shipped volumes. But NZ farmers and trade officials hotly dispute this claim. Smith’s comments come as a no-deal Brexit seems more likely with the prospect of Boris Johnson becoming the UK prime minister. See more on the prospects for NZ in post Brexit UK on page 3.
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AGRICULTURE MINISTER Damien O’Connor has lashed out at Auckland International Airport for failing to provide adequate space for MPI’s biosecurity operations. O’Connor says redevelopment of biosecurity checking areas appears to be the last thing the airport is spending money on, despite its assurances to him early in his time as minister that it would do the work needed. “Frankly I find that abhorrent. They have invested in every other area of airport development and spent hundreds of millions of dollars, yet the area of welcome where we first have to interact with many of the people visiting New Zealand is not up to standard,” he told Rural News. “We want better systems of biosecurity checking and we have one x-ray machine in there at the moment. We want to put another one in, but we simply don’t have the room or space to do justice to either the biosecurity system or the people visiting NZ.” O’Connor says the airport company obviously doesn’t see this as a high revenue area and that upgrading the biosecurity area is a low priority. He’s had “promises and promises” and says he’s a little tired of these and wants action. The airport needs to speed up its development plans, O’Connor says. “The fact that they have left it until last is in my view outrageous.
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RURAL NEWS // JULY 2, 2019
NEWS 3 ISSUE 679
Brexit opportunities for NZ PETER BURKE firstname.lastname@example.org
NEWS��������������������������������������1-16 AGRIBUSINESS����������������18-19 MARKETS�������������������������� 20-21 HOUND, EDNA���������������������� 22 CONTACTS����������������������������� 22 OPINION����������������������������22-24 MANAGEMENT���������������25-27 ANIMAL HEALTH����������� 28-29 MACHINERY AND PRODUCTS���������������������� 30-34 RURAL TRADER������������� 34-35
HEAD OFFICE Top Floor, 29 Northcroft Street, Takapuna, Auckland 0622 Phone: 09-307 0399 Fax: 09-307 0122 POSTAL ADDRESS PO Box 331100, Takapuna, Auckland 0740 Published by: Rural News Group Printed by: PMP Print CONTACTS Editorial: email@example.com Advertising material: firstname.lastname@example.org Rural News online: www.ruralnews.co.nz Subscriptions: email@example.com ABC audited circulation 79,599 as at 30.09.2018
THE NEW Zealand and British agritech sectors have huge scope to work together, says Britain’s deputy highcommissioner to NZ. Helen Smith’s comments come as a no-deal Brexit seems more likely with the prospect of Boris Johnson becoming the UK prime minister. His hard-line ‘leave at any price approach’ has all but eliminated the chances of negotiating a compromise exit from the EU. Smith says the headline message is that Brexit is an opportunity for the UK/NZ relationship. “I have been in NZ four years and since the referendum there has been a
real uptake in interest in strengthening the bilateral relationship between Britain and NZ,” she told Rural News. “In particular, there is a big focus on the trade agenda and we have a commitment – at prime ministerial level on both sides – that once the UK is in a position to do so, it will proceed with a gold standard, high quality free trade agreement (FTA).” Smith says the scope of the FTA agenda is huge and goes beyond trade. Climate change and sustainability are absolute priorities for the UK government and it hopes to work closely on these with NZ. The UK stand at Fieldays had a delegation of 11 representing companies, universities and research institutions -- one already in a partnership with
– regarding sheepmeat access post Brexit – will mean the volumes going there now will remain unaltered. NZ farmers and trade officials hotly dispute this. They expect the split of tariff rate quotas (TRQs) as proposed by the EU and UK would be very damaging to NZ farmers. And a lot of concern is voiced about the future of the WTO and whether its rules can be enforced. Smith believes the WTO will survive its current turmoil and when Britain leaves the EU it will have an independent voice at the WTO and be able to advocate for the freeing of trade barriers. “There is a real opportunity to work together, amplify those messages and try to strengthen that institution even more,” she says.
Zespri cashes in on brand ALONG WITH health, brand is one of the top five drivers of consumer preference, says Janice Byrnes, Zespri marketing manager for Australia, Thailand and Vietnam. “It makes sense – consumers want consistency, they want quality,” she told the HortConnections conference in Melbourne last week. “Brand is important around the world and that is why we want to build our brand globally. There are lots of other drivers there in decisionmaking – social image, price and the appearance of the fruit,” she explained. If it doesn’t look good consumers won’t pick it up, Byrnes added. “That is a challenge for kiwifruit in particular: it is brown on the outside and not very attractive, but the inside is beautiful. So we like show-
Janice Byrnes (centre) with Zespri marketing team colleagues Lai Kim and Hayden Brewerton.
casing the inside of our fruit as much as possible.” She told the conference that a brand needs to be meaningful and relevant to the consumer. “The most successful brands in the world are different. They are seen as
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Massey University, Smith said. She sees opportunities for the two countries in agritech, broader technology and in the services sector. “We want a very broad FTA covering not only goods but, obviously, agricultural goods, and I see a lot of scope for collaboration between our two sectors, rather than competition.” Smith concedes that farmers in both the UK and NZ have concerns about how an FTA may impact on agricultural exports to Britain. With Brexit, UK farmers have concerns about the volume of NZ primary exports there, while NZ farmers fear that their access may be constrained. She claims the access arrangements Britain and the EU have put to the World Trade Organisation (WTO)
different and unique in the category. They are dynamic and they set the trends.” In the category, Zespri is looking to innovate for the future with more varieties of kiwifruit. It has worked on a global brand
vision that will be seen as consistent by consumers across the globe. The team has proposed the brand vision ‘making life delicious’. That is the vision of where they want to go as a brand globally in the future. But they also have existing campaigns that have worked well in many countries that are quite different, Byrnes says. In some countries Zespri needs to overcome the perception that green kiwifruit is quite sour when, in fact, the ripe fruit is sweet, Byrnes says. The advertising examples shown differed in tone and mood. She explained that Zespri is on a global journey to see where it could find consistency or where it needs to be locally relevant or individual to a specific market. – Pam Tipa
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RURAL NEWS // JULY 2, 2019
Fonterra back in India SUDESH KISSUN firstname.lastname@example.org
FONTERRA’S RE-ENTRY into the lucrative Indian market comes after years of homework, claims Fonterra India/Sri Lanka managing director Sunil Sethi. He says India’s dairy market has evolved over the last 12 years and the co-op is well placed to use its dairy expertise to meet the needs of Indian consumers. Last week Fonterra launched its Dreamery brand of dahi (curd), UHT toned milk and chocolate and strawberry milkshakes in Mumbai. This is the co-op’s second foray into India since its inception. In 2001, Fonterra formed a joint venture with Bangalore-based Britannia Industries, but pulled out in 2009, saying at the time that it no longer fitted its strategic priorities. Sethi says India now has a very different dairy industry. Consumer tastes have changed and they are now open to
Report dodgy fliers From Left to right: Fonterra Future chief executive Ishmeet Singh, Fonterra India and Sri Lanka managing director Sunil Sethi, Future Group chief executive Kishore Biyani and Fonterra strategic portfolio management director Chris Gree.
innovation. Logistics and cold chain systems there have vastly improved. Fonterra hopes to have a full range of Dreamery dairy products on sale there within two years, using milk sourced in India. And Sethi says Fonterra will also tap into India’s growing food service business by supplying products made in New Zealand. Consumer demand for dairy in India over
the next seven years is expected to increase by 82 billion litres -- seven times the growth forecast for China. “India consumes 170 billion litres of milk every year... the opportunity is huge,” Sethi told Rural News. The joint venture partner, Future Group, is present in 26 of 31 Indian states with at least 2000 modern trade outlets and 5000 public distribution
outlets and a nationwide cold chain and ambient distribution network. Sethi will chair the joint venture board with three representatives each from Fonterra and Future Group. Chairman John Monaghan and chief executive Miles Hurrell visited India a month ago for an update on the joint venture. @rural_news facebook.com/ruralnews
A GOOD TIME FORMER FONTERRA director Earl Rattray believes the timing is right for the co-op to re-enter India. Rattray, who has dairy farming interests in India, says the country is going through a massive transition. “This is visible in rising consumer aspirations and expectations around what they buy and where they buy it,” he told Rural News. Rattray is impressed with Fonter-
DAIRY FARMERS are being urged to tell authorities about “concerning activity” by helicopters and drones. But farmers should also be aware that drones, helicopters and fixed wing aircraft have legitimate business in rural areas, like checking power lines and spreading fertiliser. DairyNZ head of South Island Tony Finch says it has had reports of helicopters and drones flying low over Southland farms where they disturb stock. “This is concerning for farmers and is an animal welfare risk,” Finch told Rural News. “We have encouraged farmers to report incidences of concerning activity by helicopters and drones to the Civil Aviation Authority (CAA). Activ-
ist activity against farming has occurred previously and, while we cannot confirm a link between the two, we want farmers to be aware of the potential for this.” Meanwhile, Finch says many aircraft operators have legitimate business and should be allowed to operate without interference. Finch says previous interest in wintering and cows on crops has prompted a response by the agricultural sector. DairyNZ and Beef + Lamb NZ have been actively sharing information, tips and advice to farmers, to encourage farmers to farm in ways that can reduce the risk of excessive mud in their paddocks, keep their cows dry and well, and protect their soils and waterways.
NOT US! ra’s tie-up with the Future Group. “They are one of these ‘new age’ companies which will transform India, quite a positive disrupter in the market, and run more like what we are used to in terms of corporate governance. It’s a bit like a Walmart of India, except they are Indian, and you need to be to understand the Indian consumer.” Rattray says the Indian market
has come a long way since Fonterra’s first foray with Britannia. “The focus of that joint venture was initially on fresh white milk across the country, almost the only category at that time. It was competing with established companies which do things differently from what we are used to, and it was competing with the massive informal trade.”
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FISH & GAME New Zealand says it’s aware of speculation that a campaign is underway against winter grazing practices and animal welfare. But FGNZ chief executive Martin Taylor says it has nothing to do with this campaign to date. “We are not funding it nor are we aware of any filming being undertaken from aircraft or helicopters.
“We remain concerned about environmental damage if farmers continue to flout winter grazing guidelines. “Fish & Game calls for regional councils to make DairyNZ’s good management practices compulsory as these guidelines would reduce the environmental degradation currently caused.”
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RURAL NEWS // JULY 2, 2019
Pamu’s covert PR campaign DAVID ANDERSON
GOVERNMENT OWNED farmer Landcorp (now called Pamu) is claiming commercial sensitivity as the reason for refusing to reveal the cost of funding a publicity campaign about its operations on the website newsroom. co.nz. And it also is refusing to reveal who approved the project. Following revelations that the state farmer had entered into a “partnership agreement” with Newsroom, Rural News filed an Official Information Act request for more details. On May 16, the website published the first of a series of five ‘content partnership’ articles claimed to be looking at “innovations and new ways of farming being introduced by publicly owned farmer Pāmu”. A
“I am advised Landcorp has entered a limited content partnership with Newsroom, which will see Newsroom research and publish a series of five articles on different aspects of the company.” second article was published on June 21. Rural News filed its OIA request on May 16 asking, among other things, how and why this content partnership arrangement was made and who gave approval for it? After a delay of at least one month, on June 20 Landcorp’s senior legal counsel Kim Elwood replied, declining to answer under section 18 (d) of the OIA. Instead, he referred to an answer, by the minister responsible for Landcorp, Shane Jones, in reply to a writ-
ten question on the same subject posed by National’s agriculture spokesman, Nathan Guy. Jones’ answer to Guy is vague and non-specific. It reads: “I am advised Landcorp has entered a limited content partnership with Newsroom, which will see Newsroom research and publish a series of five articles on different aspects of the company. These articles are produced by Newsroom journalists, with Landcorp’s role being to facilitate access to its operations and ensure
Pamu chief executive Steven Carden will have ultimately been responsible for the deal.
accuracy. There is no timeframe for publication of the articles.” Jones also claims that “informal farmer and industry leader feedback on raising awareness of the work the company is doing… is a key opportunity to improve the com-
NICE FOR SOME! ACCORDING TO Pamu’s 2017-18 annual report, net profit after tax was $34.2 million – down by $17.7m (34%) on the previous year, which it blamed on lower gains from forestry and livestock and a higher tax liability. But despite this less than stellar financial performance, Pamu still paid big salaries to about 25% of its staff. The report shows 171 of Pamu’s 661 staff were paid salaries ranging
from $100,000 to $729,000. A breakdown of the state farmer’s top earner numbers shows, for the year, 121 people in the $100,000 to $149,000 pay range, 35 earning between $150,000 and $199,000, and 14 earning between $150,000 and $389,000. And the biggest earner – most likely chief executive Steven Carden – took home $729,000 for the year. Yet despite the big bucks paid
to its top 25% employees, Pamu claimed in the annual report that during the year it “continued to see high employee turnover on our farms”. Said the report, “During 2017-18 we analysed reasons for high turnover in our dairy business and have made changes as a result.” The company makes no mention of the changes it made nor any analysis of the high staff turnover rate.
pany’s contribution to the future of successful farming in New Zealand”. “Landcorp advises that it has identified that one of the ways it can cost effectively raise the value it creates for NZ agriculture is by raising farmer and wider public awareness of these important applied demonstration trials through a relationship with Newsroom which has a wide audience reach. In this way, Landcorp advises, it can increase its value as a SOE to the primary industries,” says the minister. Jones’ answer did not reveal the costs to taxpayers of the campaign, claiming instead that “the terms of the contract with Newsroom are com-
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mercially sensitive”. When asked by Rural News for a cost benefit analysis of the deal and readership figures for Newsroom, Pamu supplied the rather unreliable Google Analytics numbers supplied to it by the website, which claim “210,000-plus monthly uniques” – whatever that means. Pamu concedes that Newsroom does not break down readership by occupation (e.g. farmers), “but geographically they have around 24% in total [who] live in the ‘regions’.” However, media experts spoken to by Rural News question both the value of the campaign and the readership methodology used by News-
room and Pamu to justify it. One expert also questioned Pamu’s use of Newsroom and the small readership it offers, saying its audience is a very peculiar one for a promotional/information campaign on the latest trends in farming. “It’s a rather obscure website more known for its beltway exposés on politicians and government bureaucracy than any serious agribusiness journalism,” he told Rural News. “Its extent of agricultural stories seems to focus on lectures on the farming sector’s lack of action on climate change by environmental advocate and cycling enthusiast Rod Oram.”
RURAL NEWS // JULY 2, 2019
$8 lamb on the cards SUDESH KISSUN email@example.com
SHEEP FARMERS are in for another year of solid returns, says ASB’s senior rural economist Nathan Penny. In his Commodities Weekly report Penny predicts lamb prices keeping pace with last year and tracking towards $8/ kg again. He notes prices have lifted 80 cents/kg since their low for the year in March. “Moreover, prices look on track to crack $8.00/ kg again in the spring,” he says. “Prices are now identical to the level back in mid June 2018. Previously we had thought that prices would top out in the high $7.00’s. Now, we expect prices to top
$8.00/kg over the spring. Recall that prices peaked at $8.43/kg in spring 2018.” A variety of factors are driving lamb prices higher. Firstly, on the demand side, African swine flu has ripped through the Chinese pork industry, with reports of up to 250 million pigs being slaughtered as a result. Chinese consumers have had to switch to other proteins such as lamb. Secondly, lamb supply remains tight both in New Zealand and Australia: increasing numbers of conversions of sheep/beef land to forestry in NZ will reduce lamb supply over the coming few years. “While not necessarily a good thing for the sheep industry, these
conversions will nonetheless underpin lamb prices for an extended period,” Penny says. ANZ agricultural economist Susan Kilsby agrees farmers are enjoying yet another year of strong lamb prices. Prices were above $7/ kg carcase weight level for most of the season and livestock agents had to work hard to keep lambs flowing through to processors this year, she says. The number of lambs processed this season (to mid-May) is 5% lower than last season. Beef + Lamb NZ estimates 19.05 million lambs will be available for processing in the year ending September 30, 2019. Typically by this point in the season 75% of the available lambs will have been
processed, Kilsby says. “It is debatable whether another 4.7 million lambs will be on the way given likely retention. The increase in profitability in sheep farming in recent years has pushed ewe prices up and so more ewe lambs are likely to be retained for expansion purposes. “Excellent pasture production con-
ASB’s Nathan Penny
TOUGH FOR FINISHERS ANZ’S SUSAN Kilsby says it has been a tougher year for lamb finishers as the supply of store lambs has been meagre at times. But short term pressure on pasture growth at certain times created opportunities for buyers who had feed on hand. She says the strength of the lamb market remains underpinned by growing demand from China for a
range of meat cuts. “In recent years strong demand from China for mutton and the poorer quality lamb cuts have bolstered overall returns. “But we are now seeing increased demand for higher value cuts from this market as well. “Brexit had the potential to disrupt our lamb markets this season due to UK and continental Europe
being large markets for NZ lamb. “Despite the uncertainty that persists on the Brexit process, and the weak economies of Europe, demand and pricing for NZ lamb has been stable in these markets. “The stability from this market, combined with the buoyant Chinese market and the lower NZD, has supported farmgate prices.”
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ditions earlier in the season, combined with slightly lower lamb numbers, meant farmers were reluctant to let go of lambs before they reached optimal weights. “The lambs processed this season have killed out 0.6kg heavier on average than normal. This additional weight has also bumped up returns to farmers by another 3%.”
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RURAL NEWS // JULY 2, 2019
Limbo causes drop in confidence PETER BURKE firstname.lastname@example.org
AN AIR of uncertainty hangs over the whole agri sector, says the ANZ’s managing director of commercial and agri, Mark Hiddleston. He told Rural News that at a time when the agri sector looks in really good shape with good prices at the farm gate and a positive outlook in overseas markets, the mood in the sector is flat. Hiddleston says the farm debt burden is improving and the interest rate environment is good. “Given all these things we should be celebrating and really proud, but it doesn’t feel that way. “If you ask, ‘is the
sector more or less bankable?’, [ANZ would say] the concerns that we – and our customers -- have in terms of the challenges we face [signal] that we are not sure. That’s because [the bank’s] customers are not certain about their compliance and sustainable farming requirements because these are still unknown. “The same applies to the climate change accord.” Hiddleston says the Reserve Bank’s capital proposal will put either put a constraint on the availability of capital or the cost of capital. The answer to this won’t be known until November, he says. “This uncertainty is
leading to a lack of confidence. When you go around the country that’s what you are feeling. People should be feeling happy, they are not underwater, but they are not feeling too confident and proud of what they are doing.” Hiddleston believes there is a lot of positioning and politics going on at present over various things and says this will probably lead into next year’s election. He says farmers want to lift their game and improve sustainable
practices and believes there needs to be a conversation how best this can be done.
ANZ’s Mark Hiddleston
STOP FARMER BASHING! BASHING UP farmers is not the way to get them to do more in sustainability and compliance, says ANZ’s Mark Hiddleston. He says this will only lower their already low morale. He believes farmer bashing is deterring talented people from entering the industry and farmers from investing in making changes to meet the new sustainability requirements. “I call it the ‘thin red line’. In other words, farmers will do the bare minimum to avoid being punished,” he told Rural News. “It’s like bringing up kids. You can either get them thinking positively as they grow up or you can beat them. My worry is that we are going to start beating farmers at a time when they need more reward and support.” Hiddleston says he’s not suggesting farmers should be thrown massive subsidies, but if the market is paying massive premiums for the valuable products farmers
produce, they should get a share of that premium. He says that as a banker he has a role to play in this. “Take for example a farmer who is investing in a more sustainable farm who will be receiving a differentiated payout and whose land is at least going to hold its value and the farmer is going to have the right to operate. Why shouldn’t they have a cheaper loan? This sort of thing is a better outcome and something that can be built on.” Hiddleston also believes a generational strain is now starting to appear in the farming sector, imposing mental strain on the industry and discouraging new talent from entering the sector. He believes change will be necessary and will require people with energy -- not necessarily young people -- to manage this change. “But some of these things require physical involvement and if you are at the end of your career you may not have that energy because it is not a one or two year play. It is more like a 10 or 15 year play.” Hiddleston says this phenomenon is not unique to the farming sector, but he reckons it’s worse because of underinvestment that has taken place, especially during the dairy downturn.
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RURAL NEWS // JULY 2, 2019
Hort NZ an example for Australia PAM TIPA email@example.com
HORTICULTURE NZ received high praise at an Australian horticultural conference last week. The organisation was held up as an industry advocacy model that could be copied by Australia’s multi-billion horticultural sector. AusVeg chief executive James Whiteside said Horticulture NZ manages all the industry wide advocacy issues in NZ. “They do it once and they do it well. Regardless of the method we adopt that is an outcome we must achieve,” Whiteside told the HortConnections conference in Melbourne.
In Australia, he says, the industry players trip over each other. “There is too much duplicated effort and waste. We waste too much time and money and it is not acceptable. The results are actually suboptimal. “For the industry to actually achieve its potential and grab the opportunities the future holds this is one area where we need to lift our game and always have front of mind the best interests of growers.” The industry needs a stronger collective industry advocacy capability, he says. The HortConnections
conference was jointly hosted by AusVeg and Produce Marketing Association ANZ.
AusVeg chief executive James Whitehead.
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BIOSECURITY MUDDLE BIOSECURITY IN Australia needs to be seen from a nationwide perspective rather than its state model which places the country at a huge disadvantage internationally, Whiteside says. Growers themselves are the most valuable resource as they are at the front lines of disease and pest detection. “However those who have done the right thing and duly reported outbreaks have been significantly damaged both socially and financially,” he told the conference. “This is precisely the opposite of what should happen. The cost of fully compensating growers who do the right thing will always pale into insignificance alongside the cost to the industry of a poorly managed incursion. “This anomaly needs to be fixed and we need to develop a mechanism that rewards and encourages reporting.” Horticulture Innovation Australia Ltd chief executive Matt Brand said the sector is booming. But the industry has a “soft underbelly” undermining its reputation – workers living in squalid conditions on poor pay. This needs weeding out, he said. This would allow the industry to promote its positive side “and help understand the consumer concerns about our industry and work together to solve them”.
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RURAL NEWS // JULY 2, 2019
Westland’s biggest shareholder to abstain NIGEL MALTHUS
CORPORATE FARMER Southern Pastures, Westland Milk Products’ largest shareholder and milk supplier, says it will abstain from voting on the proposed takeover offer by Chinese giant Yili. Yili’s offer of $588 million, or $3.41 a share, would return the average Westland farmer about $480,000. Although supported by the Westland board, to succeed it will need the support of 50% of all eligible voters, and 75% of votes cast, at a closed meeting of shareholders in Greymouth on July 4. Southern Pastures says it will abstain because it wants to allow greater weight to votes from West Coast shareholders whose livelihoods will be impacted by any deal. Prem Maan, the executive chairman of Southern Pastures, said the decision was the result of careful deliberation. “Our Westland supplying farms are situated in Canterbury, and as such we are in the fortunate position of having options for who we supply. “Many of our fellow shareholders in
Westland chair Pete Morrison.
Westland aren’t so well placed. So, we believe we have a moral obligation to leave the critical decision on whether or not the offer should be accepted to those Westland shareholders on the West Coast who have, and will have, no other supply options.” Maan said Southern Pastures felt that Yili had made a fair offer and would consider working with Yili if it was successful. “We will, however, be sad to see the demise of the cooperative if that were
to happen. We are strongly committed to the cooperative model and, in fact, joined Westland and formed our joint venture, New Zealand Grass Fed Milk Products LP, with it because it was a farmer owned cooperative.” Southern Pastures says butter produced by that joint venture is now a finalist in the best butter/dairy spread category in this year’s World Dairy Innovation Awards. Owned mostly by European ethical pension fund investors, Southern Pas-
tures is the largest institutional farming fund in New Zealand. It also owns 50% of Lewis Road Creamery. Its nine Canterbury farms produce 4 million kgMS/year and have supplied Westland since the start of the 2018-19 season. Meanwhile, the Westland board has urged all shareholders to “exercise their votes” at or before the meeting on July 4. In a statement, chairman Pete Morrison says it is important that “all shareholders participate in the
vote”. “This is a very important decision for Westland farmers and we want all shareholders to participate.” For the deal to be approved, at least 75% of the votes of all shareholders who are entitled to vote – and who actually vote – must be voted in favour of the deal. At least 50% of the votes of all shareholders entitled to vote -whether or not actually voted -- must be voted in favour of the deal. “It was pleasing that many of our shareholders attended the recent farmer consultation meetings,” Morrison said. The meeting had “robust but open and inclusive discussions” where shareholders were able to “air their opinions and question the board more closely on the specifics of the proposed deal”. “The next step is for shareholders to make their decision and vote.” Under the deal, existing Westland suppliers will receive $3.41 per share and the guarantee of the company collecting milk and paying a minimum payout of the Fonterra farm gate milk price for 10 seasons from the season commencing August 1, 2019.
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THE WESTLAND board chair, Pete Morrison, has defended bonus payments to chief executive Toni Brendish and other top executives, criticised as having conflicts of interest. Brendish is reportedly due for $680,000 and others would get up to $360,000 if the deal goes through. In a statement, Morrison said the retention and incentive payments were put in place to cover the whole of Project Horizon – the 12-month process which sought investment partners for Westland and which eventually came up with the Yili deal. Morrison says the payments only relate to senior executives. No incentives were offered to board members. He says a driving goal was retaining key personnel through a process that could result in significant change. It recognised the additional work required of them by the project and it protected shareholder value. “If senior executives had left during the process it would have presented a picture of instability and that would have undermined possible interest and proposals,” he claims. “It is important to note this is a normal course of action for such programmes.” Morrison acknowledges that the information should have been included in the scheme booklet, but says this oversight was corrected immediately it was identified.
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RURAL NEWS // JULY 2, 2019
Fresh, healthy and growing PAM TIPA firstname.lastname@example.org
NEW Zealand’s fresh product industry and supply chain is valued at $14.7 billion, says a new report by the industry. That value makes it the eleventh-largest industry in NZ.
Fresh produce is bigger than education and training, accommodation and food services and is comparable to health services, says the Produce Marketing Association (PMA) ANZ chief executive Darren Keating. He launched the report – a first for the industry – at
the association’s HortConnections conference in Melbourne last week. The report is aimed at understanding the size and scale of the fresh produce industry and the consumer trends likely to impact the industry in the future. This is the first sin-
gling-out of the industry as an entity and the first time its size and scale have been measured in this way using industry indicators across Australia and NZ. Growth in NZ has been relatively steady over the last five years – 3.6% per annum, says
Keating. The industry valueadd was $2.3b in 2018, up 3.8% from the previous year. Industry exports were $3.2b, up 3.2% on the previous year, and the industry last year had 36,000 employees. In 2018, NZ exported $11.86 of fresh produce
Producer Marketing Association chief executive Darren Keating.
for every $1 of imports. Keating says the report outlines a lot of trends, not all heading in the same direction. He observed in the report that the fresh produce industry is big, mostly in opportunities. But across the data they still see a lot of year to year variation. “At heart we are still talking about an operation that has its roots in farming, in growing. So
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the weather plays a role there.” But there are a lot of other drivers like market trends and prices. They are going up and down but if the overall trend was relatively flat they would have a problem. The three megatrends are globalisation, demographics and technology. These drivers are disrupting industry and will continue to do so in the future.
THE RISE of snacking vegetables, home delivery services, meal preparation kits and superfoods show increasingly time-poor consumers want high quality fresh produce conveniently packaged, Keating says. Businesses have shown that increased adoption of technology including robotics, blockchain and software creates leaner supply chains, reduces costs and provides tailored products and experiences to consumers. The ‘internet of things’ and the increasing use of artificial intelligence and technology will be integral to both the production and consumption of fresh products. As more consumption data becomes available, tailored products can be produced and provided to consumers to meet the growing need for convenient fresh products. “This increasing demand for data will mean producers need to be more efficient and smarter about the way they collect and share that data,” says Keating. “Consumers expect to be understood and catered for. They value transparency, service over product and they tend to have low brand loyalty. Think about what that means for your business.” He says demands for politicians to pay attention and do more for the environment is “not going away”. Keating says this has implications for the industry on packaging and waste. With climate change and sustainability “we can’t just talk about it and say ‘yes we believe in it’.” He said the fresh produce industry needs to go beyond the mantra of “eat your greens, it is healthy”. The successful business in the future will have enhanced contact interaction with customers including the consumers.
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RURAL NEWS // JULY 2, 2019
Farmers urged to connect locally SUDESH KISSUN firstname.lastname@example.org
HAURAKI DAIRY farmer Connall Buchannan is urging farmers to get more active in their local communities.
He told the South Island Dairy Event (SIDE) in Invercargill last week that active farmers would ensure their voices were heard during decisionmaking.
Buchannan, who milks 1100 cows on two farms near Paeroa, Hauraki Plains, is a former chair of Federated Farmers sharemilkers section, was a founding
Supplier Roadshow 2019 Silver Fern Farms Co-operative shareholders and farmer suppliers are invited to attend our upcoming Plate to Pasture Supplier Roadshow. Meet Chief Executive Simon Limmer and members of our team to hear an update on company strategy, performance and the season to date. Rob Hewett, Chair of Silver Fern Farms Ltd and Richard Young, Chair of Silver Fern Farms Co-op will also be available to discuss progress on key business initiatives. We’ll be in your region at the following locations: Tue. 9 July
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member of the Fonterra Shareholders Council, is a trustee of Netherton School, Paeroa and a member of the Hauraki Plains Marine Spatial Plan stakeholder working group. He spent three years in Chile starting a dairying company which has grown to 40,000 cows. Buchannan says given the public focus on environment, doing the right thing environmentally, both on and off farm, “is good in and of itself”. Caring for the environment is often also a good way to bring people together to connect. “On farm in 2019 we all have a range of environmental initiatives now common or compulsory and ‘business as usual’: nutrient budgets, enviro walks, fencing waterways,
Hauraki dairy farmer Connall Buchannan.
riparian planting, good winter crop management and planting for shelter and biodiversity. “Some of these were not common 30-plus years ago when I started farming although, interestingly, there are farms
Setting the pace says an expert in fast moving consumer goods (FMCG). The US is four or five years ahead of Australia in market trends, as are NZ and France, said Denise Hamblin, national FMCG head at Colmar
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which have had versions of those things in place for generations.” Buchannan says on farm initiatives will continue to evolve and farm environment plans are common and a further step down that road.
“As farmers we need to continue working to minimise the negative and maximise the positive environmental impacts we have. “We need to be engaged in working out the methods used so that our production systems retain economic as well as environmental sustainability. “Being involved in formal processes, informal discussions and our community generally help ensure our voice is heard and has the credibility to be listened to and considered as some of the important decisions are made in this area,” he says. “Environmental policy and regulation is an area where the decisions aren’t ours alone to make.”
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Brunton. Hamblin told the HortConnections conference in Melbourne that societies go through different eras ranging from conservatism to rebellion, the latter often being the time when most innovative ideas and changes in values occur. Colmar Brunton had measured values in Australia in 1999 and compared these with two international ‘dipstick’ studies, both including NZ, in 2016 and 2018. She told Rural News that NZ tends to be five or six years ahead of Australia in values and social unrest. Australia is still in a conservative phase but should be moving out of it within a few years. With FMCG, NZ “has moved more into a [sustainability] area where consumers are demanding more sustainable products and packaging”. “The environment is one issue, so is the health overlay. NZ is further developed in [health] -looking at mental health, looking at health more holistically, looking at chronic diseases and looking at personalised solutions. “NZ is ahead of us. When we talk to our clients about marketing and
product development, innovation and communications, we look to NZ advertising and product to see what is happening there to predict what is going to happen for Australia in four or five years. It gives us a seeing glass.” That applies to all sectors, she says, but her focus is FMCG – packaged or fresh. “With the fresh market, people want to look for a new way. They want to have personalised health, to consume things that will not only heal them but heal the planet. It is a big change and NZ is certainly ahead of us.” Era change occurs in countries through a series of tipping points. Specific tipping points had turned NZ into a ‘rebellion’ market. “Australians have been laggards in conformity, but NZers have not put up with it. [Perhaps because of] disasters, NZ has had to band people together to find the better way. They might have been more accelerated based on things like that. Hamblin says they used to do Australian studies every four to five years, but now it is every two years.
RURAL NEWS // JULY 2, 2019
Falls dam delay frustrates backers NIGEL MALTHUS
THE FALLS Dam irrigation project in the Manuherikia catchment, near Alexandra, has been put on hold because of uncertainty over water allocations. But the $60-70 million project will go ahead when the issues are resolved, says Manuherikia River Ltd (MRL) acting chair Gary Kelliher. The project is aimed at raising or replacing the 1930s Falls Dam on the Manuherikia headwaters, near St Bathans, to about double its capacity, and amalgamating and upgrading several small irrigation schemes based on the river to improve storage and security of supply. Most of those schemes rely on historic mining water rights due to expire in 2021 and need-
ing replacement with Resource Management Act consents. But there is uncertainty over that process and proposed minimum flow limits which irrigators believe would be too restrictive. Kelliher says too many unknowns are in the way of moving to the next phase without clear direction from the Otago Regional Council. He says they have asked repeatedly for a detailed timeline, but no one at ORC seemed capable of providing it. “They’ve shown they aren’t listening to us,” he said. Kelliher adds that the Government policy change which stopped Crown Irrigation Investments loans for new irrigation projects has also caused uncertainty. Alternative funding of $2-5m would now be needed for the final feasibility phase.
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Kelliher is a longtime backer of the project through his involvement with the Manuherikia Catchment Water Strategy Group. He has chaired MRL since October when chairman Allan Kane and two other directors stepped aside. They have all offered to return when the issues
MRL acting chair Gary Kelliher.
are resolved, but are receiving no director fees in the meantime. Waitaki National MP Jacqui Dean says she is extremely disappointed with the delay, which would impact economic development across Central Otago. “The previous National Government
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supported the Falls Dam project with a development grant of $815,000 for pre-feasibility investigations, but I feel that taxpayer money has now effectively been wasted while this project is hamstrung by ill-considered Government policy. Deans said the project would have been a
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THE WORLD will turn to horticulture in its quest to be fed in a sustainable way, a trans-Tasman conference in Melbourne has heard. At least 3500 people attended last week’s HortConnections Conference in Melbourne -- 20% more than last year’s “fantastic” attendance, James Whiteside of AusVeg told Rural News. New Zealanders attended in strength. The conference was hosted jointly by the Produce Marketing Association Australia-NZ and AusVeg. The trade fair had at least 195 companies exhibiting. Opening the event last Monday evening was PMA ANZ chairman Michael Franks who is the NZ-based chief executive of Seeka, and the chairman of AusVeg, Bill Bulmer. The conference’s theme was Growing our Food Future and the programme was a challenge to think about how the industry will look in 20 years, Whiteside told the first session. Attendees looked at questions on how to respond to the challenges of feeding our fair share of the world and how we will deal with a rapidly challenging environment around us, Whiteside said. This included climate change, sustainability and all things environmental, and rapidly changing consumer sentiment and power. Other sectors have environmental and logistical challenges that much of horticulture should be able to dodge, Whiteside said. He claims there will be a “relentless wave of environmental and social issues that will push consumers horticulture’s way”. These are the opportunities the horticulture sector must prepare itself for, he said. • Pam Tipa attended the conference as a guest of Produce Marketing Association Australia-NZ and AusVeg.
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RURAL NEWS // JULY 2, 2019
Superstar markets shine for kiwifruit PETER BURKE firstname.lastname@example.org
JAPAN AND Spain were superstar markets for NZ kiwifruit last season. This was in a year when NZ had its biggest crop -- 150 million trays, up from 122m the previous year. Zespri chief executive Dan Mathieson says the company’s sales staff earned their money as they managed to sell the extra volume and build new customer and consumer relationships. “We saw strong consumer demand and we have seen that build over the last few years, especially for SunGold and also for green and organic. That continued into 2018 and we were able to achieve really good returns. But we believe we can still do better.” A season highlight was Japan – “a superstar market” with very strong consumer demand result-
ing in six million more trays sold in green, gold and organics.
China took 27m trays – five million more than the previous year,
SUSTAINABILITY A FOCUS FOR ZESPRI
and in North America the sales volume doubled. “We have 15 people on the ground there now managing our key accounts,” Mathieson said. “We saw strong consumer demand especially for SunGold and for organics, and more and more consumers look for premium quality green.” In Europe, kiwifruit sales last season hit 66m trays – up from 46m in the previous year. Fruit volume sales were up, so was the price. Demand for green, gold and organics were all up. “Spanish consumers love fruit, they are focused on health and nutrition and demand there was strong,” Mathieson said. “They became a 20m tray market. We have only three in the world: Japan, China and now Spain.” For the first time, revenue exceeded $3 billion and is tracking towards $4.5b by 2025.
SUSTAINABILITY WILL get a lot of Zespri’s attention this year, says chief executive Dan Mathieson. The company aims to look at its sustainability framework and talk to growers about targets for real progress. This will include biosecurity, removing plastic from the supply chain, looking at work conditions for industry people and the types of agrichemical used on kiwifruit. “We are thinking about a raft of things regarding sustainability to address customers’ and consumers’ concerns and make the necessary changes to our business for a successful future,” he told Rural News. Mathieson says dealing with plastics in the whole supply chain is a huge issue Zespri needs to improve. And the company must work with partners and distributors to find solutions. For example, in Zespri transport packs, poly liners and plastic clips “we have to find better solutions and encourage innovation,” Mathieson says. “This is not just an issue for the NZ kiwifruit industry, it is a challenge for all food suppliers. If we can team up and work together and encourage more innovation, then hopefully we will be able to find a solution faster.” Mathieson says consumers want food to be packaged in sustainable materials that can be recycled, reused or composted and Zespri is looking at options.
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ACVM No’s A3977, A11311, A0934, A1011. Schering-Plough Animal Health Ltd. Phone: 0800 800 543. www.msd-animalhealth.co.nz Ref 1: Baron Audit Data. March 2019. NZ/NLX/0518/0003e(1) © 2019 Intervet International B.V. All Rights Reserved.
RURAL NEWS // JULY 2, 2019
18 AGRIBUSINESS Orchard prices strenghten DEMAND WILL rise for existing kiwifruit orchards as a result of Zespri granting its annual quota of new licences for the gold kiwifruit variety, claims a rural property salesman. Stan Robb, of PGG Wrightson Real Estate, Te Puke, says demand for the licences has been keen. “Zespri [says licences for] 700ha of gold kiwifruit and 50ha of organic gold have been issued for the 2019-20 growing season,” Robb says.
“With a total of 750ha of licences available, applications totalled 1848ha, so the offer was almost 2.5 times oversubscribed.” About 54% of the allocated licences are for new developments. Growers paid a median price for the licences of $290,000+gst/ha. “Many growers, in particular the larger ones, were planning to add to their current operations. But it appears that most of the new licences have gone to smaller
developments,” Robb says. “Those larger operators are growing green kiwifruit, planning to cut them over and graft the vines with the gold variety. Clearly, as they have not been granted licences, they will need to wait another 12 months to implement their plans and will likely bid higher to secure the 2020 licences.” Premium orchards already growing gold kiwifruit are now selling for $1.2 million per canopy
hectare, while high producing green kiwifruit properties are selling as high as $500,000 per canopy hectare. Depending on locality, bare land blocks suitable for kiwifruit in Bay of Plenty are valued from $200,000 per hectare. Robb says the unsatisfied demand for gold kiwifruit licences will hold the price for existing orchards. @rural_news facebook.com/ruralnews Andrew Watters
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FIVE EMERGING stars of the horticulture industry have been singled out for investment by a new fund which aims to raise $100 million. Kakariki Fund Ltd, to be managed by MyFarm Investments, will invest the money in orchards, vineyards, plantations and farms, which will then be co-managed by horticulture processors and exporters. Kakariki will focus on hops, kiwifruit, apple, vineyards and manuka plantations. The investment in manuka plantations is part of a long-term strategy to achieve zero net carbon emissions by 2024. MyFarm chief executive Andrew Watters says Kakariki offers investors access to the five horticultural industries via a single $100,000 sum. “There is really no other single investment that gives New Zealanders access to a diverse range of permanent crop businesses, or exposure to the intellectual property our partners have invested in their plant varieties and brand stories.” MyFarm has since 2015 raised $165m to buy into 18 individual orchard, vineyard, hop and manuka plantations. Kakariki will continue that investment, with four initial assets targeted to an option to purchase. Those four are: • An 11 canopy-hectare SunGold kiwifruit orchard in Bay of Plenty • A 50% share in a large scale 130 canopy-hectare hop garden • 35 canopy-hectares of Rockit apples • A 2000ha manuka plantation development. In each of the developments, Kakariki is working with established businesses Rockit Global, which produces miniature Rockit apples, Hop Revolution, Sacred Hill wines, Comvita, a manuka honey producer and kiwifruit grower and packer DMS Progrowers. While Kakariki will own the properties, they will be co-managed by their business partners. The target is annual investment returns of 10% from earnings from the sale of crops through the partners and any increases in land values. Kakariki says it hopes to list on the NZX within three to five years.
Check out our websites www.ruralnews.co.nz www.dairynews.co.nz
RURAL NEWS // JULY 2, 2019
Changes not all they’re cracked up to be PAM TIPA email@example.com
NEW ZEALAND egg production is expected to decline by 4.5% to 955.7 million eggs during 201920. This results from NZ banning conventional cages, according to the industry research company IBISWorld. It says while phasing out conventional cages is expected to benefit farmers producing free range eggs, consumers will inevitably have to pay more for their eggs. NZ egg producers are in transition, phasing out all conventional cages by 2022 under the Code of Welfare for Layer Hens, in force since October 1, 2018. Many farmers have cut flocks or temporarily ceased egg production to change to farming systems with better animal welfare, such as colony cages and barns. Tom Youl, a senior industry analyst at IBISWorld, says the conventional cage ban has resulted in a sharp
“Eggs have long been a costeffective source of protein, and recent research suggesting eggs have little effect on cholesterol levels has boosted consumption.” decline in egg production. He says changing from conventional cages to barn or free-range farms can be expensive. The Ministry for Primary Industries says buildings and equipment for colony cages could cost up to $660,000 for small farms and up to $8.5m for large farms. Some egg producers have quit the business, contributing to a 14% decline in NZ’s hen flock in 201819. But IBISWorld says strong demand for eggs has encouraged many farmers to remain or resume egg production with new farming systems. Its research shows demand for eggs rising for ten years. “Eggs have long been
a cost-effective source of protein, and recent research suggesting eggs have little effect on cholesterol levels has boosted consumption,” Youl says. “Also, eggs have become a diet staple of many weight loss programmes, increasing egg demand more in the past five years.” But greater demand and lower supply have pushed up farmgate prices. “Operators in supermarkets, grocery stores and convenience stores have understandably passed on these price
Egg production is expected to decline during 2019-20. Inset: Tom Youl.
Animal Welfare Regulations
on significant surgical procedures on animals.
rises to consumers. But strong demand and price growth have encouraged non-conventional cage farmers to increase production, partially offsetting production declines.” Overall egg production is expected to fall at an annualised 1.4% over the five years 2019-20.
Tell us what you think about proposed regulations for significant surgical procedures on animals under the Animal Welfare Act 1999. We want to hear from people who work with and care for animals, and anyone else who is interested in animal welfare regulations.
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says a report by Consumer NZ. This trend is despite free-range eggs costing much more than caged. The Egg Producers Federation estimates a dozen free-range eggs cost $6.89 versus $3.35 for a dozen eggs from caged hens.
“And consumers may encounter issues with reliability of produce,” Youl says. “Free-range egg producers have to contend with issues that caged egg farmers rarely experience – weather, food contamination, diseases and a higher mortality rate of hens.”
Make a submission. Go to a public meeting. Find out more. Go to: www.mpi.govt.nz/animal-consult Phone: 0800 00 83 33 Submissions close on Wednesday 24 July 2019. MPB0121
IBISWORLD EXPECTS the phasing out of conventional cages to continue the trend of consumers buying free-range eggs instead of caged eggs. Currently 75% of NZers buy cagefree eggs at least some of the time, and 25% buy only free-range eggs,
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ACVM No: A3977. Schering-Plough Animal Health Ltd. Phone: 0800 800 543. www.msd-animalhealth.co.nz NZ/NLX/0518/0003b(1) © 2019 Intervet International B.V. All Rights Reserved.
RURAL NEWS // JULY 2, 2019
Rabobank supports clients from farm to fork in
farmers to connect Content supplied by Rabobank – Grow with the bank farmers for farmers with by worldwide , founded 12630
20 MARKETS & TRENDS
global agribusiness research analysts sharing market outlooks
Optimism in the midst of chaos Global summary TIGHTENING MILK supply, reduced stocks and price stability continue to be the key themes permeating across global dairy markets. Not surprisingly, milk powder prices performed well in Q1 2019, posting yearon-year increases of over 30% on the back of lower milk supply and falling stocks. Looking forward, global supply and demand fundamentals will continue to support commodity prices at current levels in Q3 2019. However, further upside in commodity prices is limited. Inventory levels on the buy-side have improved following a period of more aggressive purchasing. Also, the milk supply curve will turn positive against low comparables in the
coming quarter, albeit very slowly. Milk production across the export engine (Big 7) has stuttered along in 1H 2019 with negative growth of 0.3%, and created tension in the global market. However, the milk supply tap is slowly being turned on. Q3 2019 will likely mark the return to growth of milk supply for the Big 7 (see Figure 1).
EU IN MARCH, EU milk production increased by 1.1% YOY, the first growth since August 2018. As a result, Q1 2019 milk production finished -0.1% lower than the same period last year (see Figure 3). Weather conditions were relatively mild during the early start of the spring flush, supporting grass growth across most of the main
milk producing regions in Europe. Hence, Rabobank increased the Q2 milk production forecast by 0.75% to +0.5% YOY. Preliminary figures for April show a continuous milk production growth in Ireland (+15.1% YOY) and the UK (+4.4% YOY), while growth in Poland eased to +2.8% YOY. Dutch milk
production declined by 1.7% YOY. German and French milk production is also estimated to be down. EU farmgate milk prices declined by EUR 1.43/100kg in the first five months of 2019, to an average of EUR 34.11/100kg in May. Rabobank does expect some upside momentum for EU farmgate milk
prices in the coming months. This will be supported by improving export returns. Growing milk volumes in the UK, Poland and Ireland will push EU milk production in Q3 and Q4 to an expected growth of 0.8% YOY and 1.0% YOY respectively. For the full year 2019, Rabobank foresees a modest growth of 0.6% YOY if weather conditions remain favourable during 2H 2019.
US MILK PRODUCTION in Q1 2019 increased a meagre 0.1% from Q1 2018. April has maintained that pace, matching the 0.1% gain from a year earlier (see Figure 4). Hidden behind these flat production numbers is a continued decrease in the national herd, offset by steady improvement in the yield of milk per cow. Milk cow numbers in April stand at 9.328m, down 1,000 head
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RURAL NEWS // JULY 2, 2019
MARKETS & TRENDS 21
Content supplied by Rabobank – Grow with the bank founded by farmers for farmers from March, but 90,000 head less than a year ago. A holding pattern of relatively flat to modestly rising year-onyear production should continue in the months ahead. Milk supply growth for the rest of the year is expected to remain below average (less than 1.5%), which should be supportive of prices moving higher into 2H 2019. Looking forward, the US will struggle to be a competitive exporter to China, as most US dairy exports are subject to tariffs that range from 25% to 45%.
China WHILE EXPECTING consumer dairy consumption to stay resilient, Rabobank is trimming total demand growth to 1% (from 1.5% previously) for 2019, given lower whey requirements as a result of ASF and retaliatory tariffs on US dairy products.
Rabobank maintains a 2% demand growth forecast in 2020. With a much stronger than expected 24% YOY dairy import arrival (Liquid Milk Equivalent) during the first four months of 2019, coupled with milk production recovery and stable consumption, Rabobank expects that inventory is building in China and putting pressure on ingredients pricing domestically. Looking into 2020, Rabobank expects LME import to decline by 3% YOY on a high comparison base in 1H, but this should turn into an 11% YOY growth in 2H, making for a full year import growth of 2%, (previously 4%) on the back of slightly higher production growth.
Australia AUSTRALIAN MILK production is tumbling to a close in the 2018/19 season. Milk production was down 13.7% in April,
versus the corresponding month last year. Interestingly, there were falls in milk production across all dairy regions – but the larger falls were still confined to Murray and Northern Australia. This brings season-todate milk production down 7.3% to 7.4bn litres. This represents a drop of 580m litres on the previous season (see Figure 7). With the milk season winding down slightly quicker than previously expected, Rabobank is forecasting Australian
Despite an underwhelming finish to the season, the 2018/19 season will most likely be the second-best season on a total volumes basis due to exceptional supply in the first half of the season. milk production to close the current season down 8.5% at 8.5bn litres. Australia’s exportable surplus has contracted significantly over the past 18 months. The pressure on the exportable surplus will peak through Q2
2019. However, it will remain under pressure well into the new season and is not likely to return to growth until mid-2020.
NZ THE LAST of the summer heat combined with minimal rain for many North Island areas has negatively impacted milk production volumes over the closing months of the 2018/19 season. Milk flows have trailed lower for the last few months since February, with production dropping 8% for the penultimate month of the 2018/19 season, compared to the prior year period. This pulls collections for the 11-month period to April
2019 lower, to just 2.3% growth (see Figure 6). With herds drying off much earlier in parts of the North Island, a sharp decline for the final production month of May 2019 is anticipated. Rabobank now expects full-season production to end with volumes higher by just 1.5%2% YOY, depending on the magnitude of the decline in May volumes produced. Despite an underwhelming finish to the season, the 2018/19 season will most likely be
the second-best season on a total volumes basis due to exceptional supply in the first half of the season. 2019/20 is set to be another season of profitability for farmers. Fonterra’s opening price forecast range is a wide NZ$ 6.25/kgMS to NZ$ 7.25/kgMS. Other dairy company forecasts are within the higher half of Fonterra’s price range. NZ$/US$ exchange rate of 0.65, Rabobank holds its forecast farmgate milk price of NZ$ 7.15/kgMS.
RURAL NEWS // JULY 2, 2019
22 OPINION EDITORIAL
Less mud throwing IT LOOKS like the next attack on farming will take the form of a campaign against winter grazing and the negative impact this can have on livestock and water quality. Done correctly, winter grazing is an effective way to keep animals fed and healthy over winter in a pastoral farming system when grass growth is low or non-existent. However, farmers in Southland, Otago and Canterbury are bracing for a major animal rights campaign against winter grazing practices, after reports that fixed wing aircraft, helicopters and even drones were used to film stock in mud. It’s likely that a highly emotive crusade, using these pictures and targeting urban audiences, will be used to throw mud – literally and figuratively – at the farming sector. It will insinuate that the industry does not care about the animals it farms or the land they are on. Watch this space! Lobby groups Fish & Game and Forest & Bird have denied any link to the campaign, but you can bet they’ll be in boots and all to criticise farmers when it does finally go public. Despite this being another cheap shot at farming, the industry can only blame itself for allowing it to gather momentum. As during the previous alarms about water quality and animal welfare, the trumpets will be blaring about the public’s lack of tolerance of cattle up to their knees in mud during winter. Such practices, albeit only by a minority of farmers, are bad for the animals, bad for the land, bad for water quality with the resulting sediment run-off and a very bad look for farming. As Beef + Lamb New Zealand’s chairman Andrew Morrison rightly says: “Poor winter grazing practices are unacceptable as they are destructive to soils and waterways and can lead to poor animal welfare outcomes.” Farmers clearly now must have a social licence to operate and this includes correct animal welfare and environmental standards as expected by the public and consumers. Farmers who disregard these standards, such as poor winter grazers, need to be weeded from the sector like other poor performers Meanwhile, the anti-farming activists must realise that constantly bashing farmers is not the way to get them to do more in sustainability and compliance. ANZ’s Mark Hiddleston believes this is only deterring talented people from entering the industry and farmers from investing in making changes to meet the new sustainability requirements.
RURALNEWS TO ALL FARMERS, FOR ALL FARMERS
HEAD OFFICE POSTAL ADDRESS: PO Box 331100, Takapuna, Auckland 0740 PUBLISHER: Brian Hight ......................................... Ph 09 307 0399 GENERAL MANAGER: Adam Fricker ....................................... Ph 09 913 9632 CONSULTING EDITOR: David Anderson .................................. Ph 09 307 0399 firstname.lastname@example.org
“I bet they’ll blame Martian dairy farming!”
Want to share your opinion or gossip with the Hound? Send your emails to: email@example.com
THE HOUND Why? YOUR OLD mate notes that a recent report out of Oxford University, no less, shows the carbon footprint of New Zealand’s milk production is pretty damn good. According to the Oxford study, emissions resulting from the production of cow milk in NZ are half the global average. Meanwhile, the study also shows NZ dairy farmland use is one-ninth of the world average and its water use beats the global average. NZ dairy also uses less water than both almond and soy milk production (suck on that James Cameron!). Therefore, this puts NZ milk among the most sustainable in the world. So the question the Hound asks is, ‘why is the NZ government so determined to reduce our country’s milking herd -- to meet its crazy, self imposed methane goals in its Zero Carbon Bill?
YOUR CANINE crusader finds it hard to have any fondness for the banks in this country. Unlike Damien O’Connor or Fed Farmers, this old mutt reckons the newly introduced Farm Debt Mediation Bill will have bugger-all impact on the banks when they decide to sell up struggling farmers. It is little more than a glorified PR exercise by the government and the bankers’ association. This was hammered home recently, when your old mate was informed that the ANZ Bank – which only made a paltry $2 billion in NZ last year – has now introduced a 0.75% charge on all its farming clients to have an overdraft facility with the bank. Fair enough, you may think, but the bank is charging this fee whether or not the OD facility is used. Perhaps this is how the bank funded its former chief executive’s annual $400k-plus expense account.
YOUR OLD mate is constantly surprised at what snowflakes we have bred in the so-called ‘millennial’ and ‘generation Z’ types. When these poor babies are not demanding multi-milliondollar pads in the best streets as first homes or jobs out of uni in which they start at the top of the executive structure, they are worrying themselves sick about the impending end of the world. According to the latest research, many of these little darlings are now being ‘diagnosed’ with climate change anxiety, triggered by their distress at looming and anticipated threats about the weather. As a mate of yours truly says, “If these self absorbed flakes are our future, then God help us.”
A MATE of the Hound reckons former Fonterra director Ashley Waugh must have taken to heart his failure last year to get re-elected to the dairy co-op’s board. According to your canine crusader’s informant, Waugh’s Waikato dairy farm now has a newly erected Synlait supply sign proudly displayed on the milk tanker track to his dairy shed. “He’s either pissed off because we didn’t re-elect him,” the friendly spy told this old mutt. “Or we (Fonterra shareholders) got it right, because he can’t really be a cooperative believing man.” A fair point, your old mate would have thought.
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RURAL NEWS // JULY 2, 2019
LETTERS TO THE EDITOR
FERTILISER QUALITY ANSWERS AVAILABLE AS AN expert appointed member of the executive of the Fertiliser Quality Council (FQC), I was disappointed to read the opinion piece by Jeremy Talbot in Rural News of June 18. The forum of the FQC meets twice a year. I have attended both the forum and – from time to time – the FQC executive for the last 22 years. NZ Federated Farmers has the controlling votes on the forum and has an arable farmer on the executive to represent this group of farmers. The topic of physical properties has had a great deal of discussion at the forum meetings. The FQC has funded research into areas such as testing physical properties of fertiliser
from both large port stores and internal satellite stores, the effects of wind and slope on fertiliser spreading, and layered blended loads and mixed loads (from a fertiliser store mixing plant). Members of the forum have also funded research into blends separating because of different ballistic properties, the economics of granulating single superphosphate and the performance of spreaders. All of the factors above can, without due care, lead to striping of crops through fertiliser application. The most common problem is the application of blends of fertiliser via tram lines set too wide for one or more of the products being applied.
PETITION OPPOSES ‘BLANKET’ FORESTRY JOBS AND the wellbeing of people in some rural regions are already being affected by a trend to “blanket” forestry. Two online petitions aimed at enabling rural Kiwis to fight this existential change to NZ’s farming areas and their ability to produce food. The petitions are to get the Government to realise the effects blanket afforestation is having already on the jobs and wellbeing of small towns and rural areas like Wairoa, Wairarapa and elsewhere. Sign up and share the links with your contacts. One petition is the work of Kerry Worsnop, Gisborne, at http://chng.it/FY2JSdnSZX The other petition is https://www.50shadesofgreen. co.nz/ Dave Read and Judy Boggard via email
SOMETHING ON YOUR MIND? GOT SOMETHING on your mind about the latest issues affecting our farming industry? Put your pen to paper or your fingers to your keyboard, and let our readers know what you think. Contact us by either post or email. Don’t forget to put your name and address. Note: Letters may be edited. post to: Letter to the Editor PO Box 331100 Takapuna , Auckland 0740. or Email: firstname.lastname@example.org
The physical properties of the fertilisers manufactured and imported by the major manufacturers and distributors are measured. The physical properties of these fertilisers often change through normal handling and storage after leaving the manufacturer. The major manufacturers – through a handling procedure protocol in
their owned stores – are addressing these issues. The customer or their nominated spreading agent should take care when applying fertiliser to ensure adjustments to the spreading bout width are made that recognises the fertiliser’s physical attributes. Dr Miles Grafton Senior lecturer, precision agriculture Massey University
RURAL NEWS // JULY 2, 2019
Connecting grass and the city MARK WEVER
THE PRESENCE of a large agricultural sector in New Zealand is sometimes viewed as an impediment to the development of a more modern and innovative economy. This view is perhaps best exemplified in the 2013 book Get Off the
Grass in which Sir Paul Callaghan (deceased) and Shaun Hendy argued that NZ’s reliance on agriculture stifles the country’s innovation ecosystem. Why? Well, according to the authors, even though the agricultural sector is good at absorbing innovations from other sectors, its own innovations are suppos-
edly of little use beyond the agricultural context. This is unlike, for example, the IT industry whose innovations benefit a wide range of other sectors and industries. From this perspective, a dollar invested in IT should be more beneficial to the wider economy than a dollar invested in agriculture.
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Expanding on this idea, the authors argue that NZers should get off the grass and into the city and the high tech industries that cities foster. The agricultural sector, however, should not be seen as a hindrance to the development of a diversified innovation ecosystem in NZ. In fact, it can be a positive contributor to the development of such an ecosystem. The agricultural sector, with its complexity, can be a highly useful foil for IT and other high tech industries in developing innovations and business applications that are scalable to a variety of other industries. Today, many innovations are not developed or commercialised by individual organisations operating within a clearly defined industrial space. Rather, they are often developed within business networks that link organisations from various industries. In this innovation process, technology, business applications and knowledge do not just flow in one direction from the high tech industries to the remainder of the economy, but also vice versa. Take the development of modern food tracking and tracing systems as
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an example. To develop these systems, the agricultural sector did not only import know-how and innovations from the IT industry, such as cloud computing and block chain technology. It also had valuable insights to export about how to deal with issues such as ‘fungibility’ and waste, fraud and counterfeiting within the supply chain, as well as how to safeguard and capture value from claims of provenance. The developers of tracking and tracing systems have used such insights in the design of traceability systems in other sectors and industries, such as the pharmaceutical, mining, apparel and cosmetics industries. The use and further adoption of these systems is expected to lead to efficiency savings amounting to billions of dollars across these and other industries. Moreover, their use within supply chains can help improve labour practices and assist smallholders in gaining a fairer share of profits. However, these systems originated at least partially in the agricultural sector where traceability issues were arguably an earlier and more pressing concern. Many of the innovations that the agricul-
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tural sector has developed through this process of co-innovation with other sectors and industries are so pervasive that they, as well as their benefits to the wider economy, are often taken for granted. Few people would consider, for example, the value ready made meals bring to the economy in time saving, but this value is real nonetheless. Likewise, it is easy to forget the extent to which improvements in agricultural production technology and practices have freed many in the western world from worries about how to satisfy their most basic needs, so allowing them to pursue other endeavors. The value of such
innovations is easy to overlook and difficult to measure or quantify, but this does not make them less worthwhile. The intersection between the ‘grass’ (as a metaphor for the agricultural sector) and the ‘city’ (as a metaphor for the high tech industries) offers a fertile soil upon which a diverse innovation ecosystem can be built. For sustainable economic growth, rather than getting off the grass, it would be more productive to further cultivate its linkages with the city. • Mark Wever is a scientist in the farm systems & environment team at AgResearch. @rural_news facebook.com/ruralnews
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RURAL NEWS // JULY 2, 2019
Being under the pump doesn’t mean you are drowning MARK DANIEL firstname.lastname@example.org
SAM WHITELOCK’S imposing 2.02m height and 116kg frame was always going to grab audience notice at a Fieldays luncheon. And there was much more from the 108-test match All Black and Canterbury Crusaders captain Whitelock. As the FMG/Farmstrong ambassador he dis-
working with others – by helping rather than criticising.” Audience feedback prompted him to say there is nearly always scope to move ‘can’t control’ stuff to the ‘can influence’ category. (The audience seemed to be saying it isn’t worth worrying about areas you can’t control.) “The ‘can influence’ tactic can be achieved by preparing for situa-
“The key point is to recognise the stress, step away from what’s causing it and do something different that you enjoy – fishing, hunting, playing sport or a community activity.” played wisdom beyond his years as he led a discussion about recognising ‘when you’re under the pump’. Farmers need to recognise when they’re under pressure, he said, noting the drag such pressure imposes on your wellbeing and that of others around you. “The biggest challenge is taking the time to write down the things causing you concern and discussing them with others,” he said. Whitelock discussed a wellbeing strategy centred on three questions: what can we control? what can we influence? what can’t we control? Things under our control include having a positive attitude and getting excited about taking on and achieving new tasks. “In the same vein, try to carry across that positivity to your work ethic, by being the first to get stuck in and relish the challenge of a task,” Whitelock said. “Looking at your sphere of influence also needs a positive mindset -- particularly when
tions before they eventuate, such as when bad weather is forecast, and/ or planning work in the shed or office where you stay warm and dry,” he explained. “Or at worst you can make sure your wet weather gear and gumboots are ready at the back door.” Whitelock talked about people’s differing abilities to tolerate pressure, which in many cases turns into stress – dependent on levels and timing. “The key point is to recognise the stress, step away from what’s causing it and do something different that you enjoy -- fishing, hunting, playing sport or a community activity.” Whitelock likened on farm pressures to those an All Black comes under. He said players are pressured in all sorts of ways, e.g. by contemporaries, the public and the media. It took him two-three years to learn to cope with this. He said the ‘magic’ of the Crusaders rugby team – its inherent culture -was a massive part of its success. Head coach Scott
Robinson forms physical and mental bonds with players, notably by bumping knuckles with each player every day to break
down underlying barriers. Whitelock’s tips to help manage stress can be seen at: www.farmstrong. co.nz
Farmstrong ambassador Sam Whitelock.
SELLING CALVES? All calves must be tagged and registered in NAIT before they move off-farm. Tag your calves correctly: the tags need to stay in for the lifetime of the animal.
Tell us which NAIT tags you have used and register them in NAIT.
Use your information provider (i.e. LIC, CRV Ambreed or Farm IQ) to register the NAIT tags you have used.
Check your information provider account to ensure the NAIT tags are recorded and synchronize with your NAIT account.
Record a sending movement: after selling calves or moving off-farm. Farmers trading calves must exchange an Animal Status Declaration (ASD) form. Saleyards can record NAIT movements on behalf of farmers selling calves.
Help build animal traceability and support disease management
LATEST STORIES EVERY DAY Get up-to-date news at www.ruralnewsgroup.co.nz
RURAL NEWS // JULY 2, 2019
Officials missing in action on spray resistance – expert NIGEL MALTHUS
HERBICIDE RESISTANCE is the “great gorilla in the room” of New Zealand agriculture, says Dr Charles Merfield, head of the Lincoln BHU (biological husbandry unit) Future Farming Centre. The centre recently hosted a one-day workshop on non-chemical weed management (NCWM). Merfield said he was pleased with the turnout of 24 people and struck by the fact that
only about four attendees were organic growers. The rest were “mainstream,” including people from FAR and the seed industry. “Which to me is speaking very loudly of the situation on the ground there now -- that people are realising there are problems with herbicides and we need Plan B,” he told Rural News. “There is clearly emerging scientific evidence on the negative effects of agrichemicals as a whole, including the herbicides.”
Merfield claims customers are becoming less and less excited by the idea of agrichemicals. “If your weed has become resistant to your herbicide it’s the end of the story. You can argue till you’re blue in the face, it makes no difference,” he says. “The thing that is really frightening – I think that word is not an overstatement now – frightening the agricultural sector, is what’s going to happen when this becomes large-scale?” Merfield reckons
both MPI and the Government are “missing in action” on herbicide resistance. He says that, apart from himself, AgResearch senior scientist Dr Trevor James is NZ’s only specialist crop weed scientist. Merfield says James told the recent Landwise conference that there are now hundreds of herbicide resistant weeds in the world. “These are big numbers globally now. We have 500 positively identified herbicide
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resistant weeds.” A “great long list” of statistics show herbicides are facing a very uncertain future, he said. “Resistance is growing across the board, with grasses leading the charge in terms of the number of resistant species.” Meanwhile, Merfield says the herbicide arsenal in use has only about 40 different modes of action, with no new modes discovered since about 1980. “They are losing effectiveness at an accelerating rate.” In his workshop presentation, Merfield said there is good news: the “cavalry” of effective nonchemical weed control is
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WHAT WORKS? MERFIELD SAYS that at a practical level, rotation is the best method of NCWM. Second-best and cheapest is “false seed bed” secondary tillage. This is letting shallow weed seeds germinate, then killing them off with a second round of tillage too shallow to bring more weed seeds to the surface – just before planting a seed crop. The workshop also detailed the variety of weeding machines and techniques now increasingly available. These include mechanical, thermal and steam, and machines that can work either between rows or between individual plants in a row. He says that, contrary to perceptions of organics as being small-scale, some very large machines are now available from Europe, such as a 25m wide spring tine tiller.
already here in the form of known physical, biological and ecological techniques. And there is not-sogood news: non-chemical weed management shifts
the need for ‘smarts’ from the biochemist to the farmer and grower – “so the latter need significant upskilling”. @rural_news facebook.com/ruralnews
Read us until the cows come home! READING THE PAPER ONLINE HAS NEVER BEEN EASIER ❱❱ Breaking news ❱❱ Management ❱❱ Animal health ❱❱ Agribusiness ❱❱ Machinery & Products reviews ❱❱ Competitions... and much more
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RURALNEWS TO ALL FARMERS, FOR ALL FARMERS
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RURAL NEWS // JULY 2, 2019
Minimising winter grazing damage WHILE WINTER feed crops are crucial in Simon O’Meara’s farm system, the West Otago sheep and beef farmer is making changes to cut their damage to the environment. Poorly managed winter feed crops harm the environment, he says, and that requires a change of mindset. “We are used to having our paddocks look like golf courses, but we have to get away from that.” O’Meara has taken onboard the findings of P21 Project trial work at Telford Research Farm that showed that the protection of ‘critical source areas’ (CSAs) and strategic grazing management can reduce soil and P losses by 80-90%. This might mean having long rank grass around CSAs -- not aesthetically pleasing but raising water quality for the whole catchment. O’Meara farms 565ha of rolling country at Wilden behind Heriot, running 3000 ewes, 800 hoggets and 250 cattle. Like many sheep and beef farms in the area, 5-10 % of his farm is in winter feeds crops -- kale, swede
and fodder beet. O’Meara is in the Pomahaka Water Care Group, learning of the main contributors to water quality issues in the Pomohaka catchment. He is now working to minimise sediment and phosphate losses caused during soil movement on his farm over winter. He starts this process at crop establishment by selecting paddocks to suit the stock class. Dry, rocky paddocks suit winter feed crops that will be grazed by cattle, while sheep can be wintered on heavier soils. “The heavier the stock class the drier the paddock,” he says. He has also identified parts of his farm that no longer suit winter feed crops. He will renew pastures on these areas in a straight grass-to-grass rotation, minimising soil disturbance and sediment and phosphate losses. When establishing a winter feed crop (spraying, cultivating and drilling), he or his contractor will identify where the ‘critical source areas’ (CSA) are. These include hollows, swales or wet
areas in the paddock, to be left in grass, fenced off and grazed last after the crop has been eaten. In winter, he begins grazing the crop from the top of the paddock so any soil and water flowing downhill is filtered through the crop. Where hollows at the bottom of paddocks feed
directly into waterways, he will build a bund or sediment trap that can be cleaned out over summer. This also means he will remove cattle from feed crops in bad weather and run them on a dry pasture paddock, but he will also back-fence to prevent cattle pugging the grazed areas.
West Otago sheep and beef farmer Simon O’Meara.
FLY HAS IMPACT THE FIRST field survey of a gall fly introduced to combat scotch thistle has shown that it is widely established and having an effect. The fly, Urophora stylata, was released in 1998. Highly specific to scotch thistle, it lays eggs in the flowers and produces a gall where the larvae grow in the developing seed head. AgResearch scientist Dr Mike Cripps says the survey showed that it significantly reduces both seed production and the quality and germination rates of the surviving seed. Cripps and a Fijian NZ Aid scholar at Lincoln University, Jovesa Navukula, sampled 20 randomly chosen sites on sheep and beef farms NZ-wide last summer. Seed heads were gathered from 30 plants at each site, then were evaluated in the lab through dissection, seed counts and germination trials. Cripps says they recorded about a 50% reduction in average seed numbers (from 10% to more than 60%) and lower seed weights, quality and germination rates. However, he says the survey is just a first step and it’s still to be determined how the fly works “at the paddock scale”. The survey did not confirm flies on the West Coast and Southland, but they are known to exist in Southland, Cripps says. Farmers can tell if the fly is active on their properties by examining seed heads. Heads with galls will feel harder than others and the maggots can be seen when the gall is cut open. – Nigel Malthus
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RURAL NEWS // JULY 2, 2019
28 ANIMAL HEALTH
Vets back pain relief SO SUCCESSFUL was a trial of a new pain relief for calves being disbudded that vets believe it could benefit millions of calves, says the local product distributor, Bayer NZ. Up to two million calves are disbudded in NZ every year. Farmers, vets or technicians use a hot iron to cauterise and remove horn-producing cells before they fuse and grow into horns. The new treatment, known as Tri-Solfen, was developed in Australia for sheep. The local anaesthetic and antiseptic topical liquid quickly dulls pain when applied to a wound, and it controls and stems infections and haemorrhaging. Bayer senior veterinarian Dr Kirstie Inglis, who took part in the NZ trial, says the product is “groundbreaking”.
“It’s the first time we’ve had a topical local anaesthetic to use on disbudded calves. “It contains two types of anaesthetic: a shorter acting one and a longer acting one combined with adrenalin and an antiseptic. Used straight after disbudding it will make a huge difference to young and vulnerable calves.” The independent lead researcher in the trial, Dr Emma Cuttance, from VetEnt Research, says dis-
budding is known to be very painful. “We found the TriSolfen product reduced the pain calves were experiencing following disbudding – out to 22 hours. “In some study groups there was a 90% reduction in marked pain response versus the control group, which is extraordinary.” In October this year, legislation will come into force which, at a mini-
mum, requires a local anaesthetic nerve block to be applied before disbudding. But Bayer says independent vets in the TriSolfen trial concluded that applying only a local anaesthetic nerve block before disbudding wasn’t enough. Instead, applying Tri-Solfen straight after disbudding calmed the calves and reduced pain sensitivity for at least 22 hours. Also, calves are said to have fared better if disbudded under sedation than without sedation. “The veterinary industry [needs to] look closer at how much pain calves suffer during disbudding,” says Inglis. She says the minimum legislation is not good enough. “We have to aim for best practice and recommend that to farmers. It’s the right thing to do.”
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RURAL NEWS // JULY 2, 2019
ANIMAL HEALTH 29
Study reveals big ewe wastage MASSEY VETERINARIAN Kate Griffiths recently outlined the results of a six year trial looking at the ability of a ewe to survive as a productive animal until she is culled for age. She told two Beef + Lamb New Zealand Farming for Profit field days in Canterbury that until now little information was gathered on farm ewe mortality. Previous estimates ranged from 2.8% to 15.7%. The trial followed 13,142 ewe lambs from before their first breeding until they were culled for age as six-year-olds. The ewe lambs were all electronically tagged and run on commercial hill country farms in the North Island. They were mostly Romneys and some composites. Over the length of the study, losses varied from 3.5% to 24.8% per annum and varied from year to year. “These dead or missing ewes represent a huge area of loss,” Griffiths says. Most years, mortality sat between 8% and 12%, with the highest mortality rates in the younger and older ewes. Griffiths explained that during the trial a huge amount of data was collected about these sheep. They were all weighed and body condition scored (BCS) at pre-mating, scanning, set-stocking and weaning and, where possible, reproduction performance was also recorded along with the date and reason for culling. While the researchers tried to collect tags from ewes that died on farm, this proved challenging. Griffiths said they did not get close to recovering all the tags from ewes that had presumably died. This was one of the main limitations of the study. Post mortems on thin ewes with BCS 2.0 and below showed most had died without any significant disease and may have responded to an intervention such as pri-
ority feeding. The losses were tracked throughout the study with the first lot occurring when dry hoggets were culled (85% of ewe lambs were mated) and this was followed by hogget mortality which ranged between 4% and 10%. “We are losing a lot of hoggets before they even get into the mature ewe flock.” A subset of data looking specifically at mated and pregnant hoggets highlighted that success in rearing a lamb was influenced by body weight, BCS and weight changes during pregnancy. In essence, it all came down to feeding. As hogget weights at set stocking reduce, the risk of wet/dries increases dramatically and this relationship was the same across all flocks. What did vary across flocks was the optimum weight. However, as a rule of thumb, the heavier the hogget is at set-stocking the more likely she is to rear a lamb through to weaning. A number of hoggets in the trial lost weight between scanning and set-stocking and this massively increased their risk of being wet/dry. “Weight is important so the hogget needs to continue to grow by 100150g/day throughout the pregnancy,” Griffiths said. “For every 1kg gained between scanning and set-stocking there is a 10% reduction in the likelihood of the hogget being wet/dry.” She says ewe longevity is a significant factor affecting the economics of the breeding ewe flock. To maintain ewe numbers, replacements are needed but these replacements have higher management costs and are a less flexible stock class. High attrition rates mean fewer ewes are going to a terminal sire and means farmers cannot apply a high degree of selection pressure to their hoggets
before they enter the mixed age flock. There is also a biosecurity risk associated with buying in replacements. The costs associated with on farm mor-
tality are high as there is no cull value and if the ewe is pregnant the loss of lambs also needs to be taken into account. As reproductive performance tends to
The six year trial showed ewe losses varying from 3.5 to 24.8% per annum.
increase with age, there is a potential production cost associated with a
flock with a high proportion of younger ewes. This study was funded
by Beef + Lamb NZ, Massey University and The C.Alma Baker Trust.
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RURAL NEWS // JULY 2, 2019
30 MACHINERY & PRODUCTS
Irish and NZ machinery sellers share common challenges MARK DANIEL email@example.com
THE IRISH equivalent of New Zealand’s farm machinery trade association works hard to help its member companies understand the needs of farmers, said its chief executive, Gary Ryan, a 25 year veteran of the industry. Ryan spoke at an Enterprise Ireland/National Fieldays dinner, giving an overview of where the Irish farm machinery industry is headed. The Irish body -- Farm Tractor and Machinery Trade Association (FTMTA) -- was formed in 1913 and promotes higher standards in the farm machinery industry. It has 220 members in manufacturing, importing, distribution and retailing. Ryan said much of FTMTA’s work is helping its members understand the evolving needs of farmers and contractors keen to adopt new technologies or practices to reduce time or increase production. Unlike its NZ counterpart (Tractor and Machinery Association or TAMA),
Irish machinery body boss Gary Ryan.
the Irish FTMTA organises two annual events: its own show that attracts 22,000 visitors, and the Grass and Muck Event, mostly a working demo on 40ha with 4ha of static sites. This draws about 12,000 visitors. “The Irish farm machinery industry employs about 6000 people and generates a domestic turnover of $NZ850 million and substantial export revenue,” Ryan said. The two largest mechanised tasks
in Irish paddocks are silage making and slurry spreading. Like the NZ industry, the Irish industry’s success is typically measured in tractor sales, showing an interesting picture over the last decade. In 2007 sales were 5029 units, dropping dramatically to 1315 in 2010 and not recovering until 2018 when 2000 units were sold. Much as in NZ, horsepower demand has risen for ten years to the current 125hp.
The shining light in the Irish machinery market is now self-propelled forage harvesters: 11 were sold in 2011, then 35 in 2018, then a huge rise to 54 machines so far in 2019. Predictably in a market dominated by livestock production (4.4m hectares in grass vs 280,000ha cultivated) the main machine sales are in feeding and mixing, grass harvesting, zero grazing, bale handling and effluent management. Grants are available for buyers of effluent management gear, notably for applicators for better use and placement. Grants are also available for precision technologies. “Dairy farmers are price takers who are affected by the milk price and the weather, neither of which they control,” Ryan said. “This has led to a focus in recent years on inputs, leading to a rapid uptake of GPS and proof of placement to satisfy regulatory authorities.” Noting a recent comment by Rural Contractors NZ on the shortage of
skilled operators in both countries, Ryan commended the Kiwis’ suggestion that each could work in the other’s country during the winter. But he says this would be unlikely to work in Ireland. “Unfortunately the issue will likely be pay rates, typically $NZ18 per hour in Ireland, so hardly a compelling reason to travel halfway around the world.” Ryan said these low pay rates often result from too many contractors chasing too little work and charging rates applying ten years earlier. He said in farm machinery retailing, typically engineers or technicians with 10 years work experience were still only grossing $NZ69,000 per annum. “Businesses in the sector need to charge more and push beyond the $NZ120/hour threshold, while also learning from the motor trade where fixed priced servicing is now the norm.” Ryan says the next three-five years will see more focus on precision technologies for application and guidance.
RURAL NEWS // JULY 2, 2019
MACHINERY & PRODUCTS 31
Industry and govt at odds over CPDs MARK DANIEL firstname.lastname@example.org
THE FARM quad industry and its regulators are at odds over the fitting of rollover devices on these machines. On the eve of Fieldays, Worksafe NZ recommended – contrary to the advice of most manufacturers -- that all quads be fitted with crush protection devices (CPDs). Then ACC said it will subsidise, by $180, farmers’ purchases of two brands of CPDs.
But Motor Industry Association (MIA) chief executive David Crawford says international research shows no credible evidence that CPDs prevent injuries. He claims government agencies’ support for fitting untested CPDs to quads amounts to an experiment with farmers’ lives. “On the contrary, research from Australia reveals that a serious accident resulting in hospitalisation is more likely to occur if a CPD is fitted to a quad,” he told
Rural News. Crawford says government officials must take time to analyse the data before rushing to draft ill-informed policies. In a fact sheet, WorkSafe/ACC recommends farmers buy a CPD that is professionally designed and manufactured. It also says these must be installed according to the CPD manufacturer’s instructions. But these instructions contradict those of quad manufacturers, who recommend against fitting
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ATV accidents and deaths have led government officials to favour CPDs.
such devices. Crawford says this is a concern in that MIA “does not advise the retro-fitting of CPDs on quads, which are not designed for them by the manufacturers”. “This is not safe
practice. The MIA is a safety first organisation and for some time we’ve been asking the government to regulate and promote simple evidence-based safety measures.” Crawford says the
MIA wants the wearing of safety helmets to be made mandatory, children to be banned from riding adult size quads and passengers to be banned on single seat quads. “We’d also like to see improvements and more
opportunities in rider training. Research in the US shows a big drop in quad fatalities since 1999 linked to increased use of helmets and restrictions on children riding,” Crawford said. Quad fatalities halved between 1999 and 2011, and Crawford says this is strongly linked to riders’ behaviour changes. “There were no engineering changes such as CPDs during this time. In NZ we’d like to see sensible, proven safety solutions and would welcome the opportunity for further discussions with the government.” The WorkSafe/ACC fact sheet says: “In future, WorkSafe is likely to make CPDs a requirement and will take enforcement action if necessary”. @rural_news facebook.com/ruralnews
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RURAL NEWS // JULY 2, 2019
32 MACHINERY & PRODUCTS
Saving the planet one post at a time MARK DANIEL firstname.lastname@example.org
WORKING AS a farmer and fencing contractor for 15 years made Jerome Wenzlick very familiar with fence posts. He saw quality slipping, wastage rising because of breaking posts and at times post availability was a problem.
Wenzlick had a ‘eureka moment’ during a fencing job next to an old rubbish dump where he had posts breaking on plastics hidden below the surface. “Surely if plastics are this tough we should be making fence posts from them,” he mused. A chance meeting with farmer and recycling guru Bindi Ground led to a
business partnership to make premium fencing products. The Future Post was born and it won the Fieldays Launch NZ Innovation Award at the Mystery Creek Innovation Competition. “Saving the planet one post at a time,” Wenzlick quips about the company’s Kiwi No. 8 mentality
Jerome Wenzlick at the Waiuku plastic post factory.
SERIES 2 EXPANDER Includes
❱ 3.1m-5.1m telescopic mast ❱ 340kg hammer ❱ 6 bank valve
19,840 + GST
Normal RRP $22,045
SERIES 2 WITH ROCK SPIKE Includes
❱ 4 bank valve hydraulic top link and angle adjustment ❱ 4.25m 150UC beam ❱ 270kg hammer ❱ Adjustable legs ❱ Rock Spike kit with 90mm spike
16,750 + GST
Normal RRP $19,030
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development. Developing the plastic required travel to the US to research plastics recycling and back in New Zealand they did more R&D. Then came developing a production plant with the help of South Waikato Precision Engineering, Tokoroa, and taking over a factory unit in Waiuku. Today, that factory takes in bales of recycled HDPE plastics including Fonterra milk bottles and soft plastics from supermarkets. These are broken down into ‘chips’ which are blended in a secret recipe and then extruded as a solid black post, cured in a waterbath to emerge as the finished product. The posts are now made at a rate of 300 per day in three sizes: 125mm diameter x 1.8m long rounds, 125mm x 2.4m long rounds for vineyard and horticulture, and
200mm diameter rounds for use as strainers. The plastic posts have many advantages over wooden posts, says Wenzlick. They last at least 50 years versus the typical 15 - 20 years for timber. And they survive well in harsh environments such as on the coast with its salt spray. In use the Bio-Grade certified Future Posts can be worked with the same tools as timber posts. They are sawn easily, take standard staples driven as usual and they suit driving with mechanical postdrivers. They don’t need insulators when used for electric fences and they don’t splinter. Plans are in place for South Island production to meet increasing demand, Wenzlick says. Buy the posts at Farm Source rural stores, priced at a “slight premium” over timber posts.
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RURAL NEWS // JULY 2, 2019
MACHINERY & PRODUCTS 33 ELECTRIC FENCING’S NEW ERA FENCING MAKER Strainrite has expanded its range of electric fence energisers with six new solar powered units that can also be powered from a mains supply. Some models are also available with an internal, long life lithium-ion phosphate battery. These are said to perform better than standard chemical batteries: they have a reliable life cycle that doesn’t suffer from memory fade and an exceptionally long shelf
life. The new energiser range also offers the option of adaptive power technology (APT), a concept developed in South Africa and extensively patented. A conventional energiser will push all available energy through any significant arcing along a fence line, so reducing the effectiveness and the integrity. But APT-equipped units will detect such arcing and try to reduce voltage to a point just
below the point where arcing occurs. This helps maintain higher energy levels along the fence line, so improving its effectiveness. In practice, the system maintains voltage at higher levels when, say, insulators get damaged or wet, salt builds up on coastal fences, or long grass or trapped animals cause prolonged earthing of the current. Alongside APT, the company
has also included a theft deterrent feature that can be locked to a user-chosen personal identification number (PIN). Entered and stored via a key chain remote, when the function is enabled, the energiser is prevented from operation until a remote with the correct PIN is presented to the unit. Each time power is removed or restored to the energiser, the remote will need to be used to activate the unit.
Today’s top-of-the-line Claas Liner 4000 has 15.5m operating width.
20 years of four-rotor swathers FORAGE HARVESTER maker Claas is celebrating 20 years of its Liner four-rotor swather. In 1999 Claas was making an integrated range of mowers, conditioners, rakes, balers, forage wagons and forage harvesters. But the company was missing a high output rake capable of staying ahead of its ‘hungry’ Jaguar self-propelled harvester. With a working width of up to 12.5m Liner 3000 had twice the productivity of the two-rotor swathers, so increasing the capacity of the entire Claas harvesting chain. Farmers and contractors reported up to 30% higher productivity thanks to faster chopping rates and less downtime. Today, four-rotor swathers are the norm in high output operations and the Liner series continues evolving to meet shorter harvest windows and a wider range of crops. The Liner 4000 and 3600 models come in maximum working widths from 9.9 to 15.5 m and swathing widths from 1.2 to 2.6 m. These machines adapt easily to different forage materials and all commonly used pick-ups, Claas says. The silage tines developed by Claas combine with accurate rotor movement control to achieve clean and complete crop pick-up while protecting the ground beneath. All models have hermetically sealed, maintenance free rotor domes that continuously lubricate cam rollers in an oil bath. Integrated tine arms are fitted with the maker’s patented Profix tine arm attachment system, allowing tine arms to be replaced in the field with minimal effort. In use, predefined bending points are located outside the rotor dome, so protecting the internal components and minimising maintenance. The large diameter and gradual rise of the cast iron cam track ensure smooth running tine arms and clean raking, and the smooth movement of the cam rollers is said to markedly increase the components’ service life. Despite their operating widths both models fold to compact dimensions for safe road transport at speeds of up to 50km/h. Tine arms need not be removed for transport. – Mark Daniel
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NATIONWIDE DISTRIBUTION NETWORK KAITAIA Kaitaia Tractors 09 408 0670 WHANGAREI Bryant Tractors 09 438 1319 SILVERDALE AGrowQuip NZ Ltd 09 427 9137 PUKEKOHE AGrowQuip NZ Ltd 09 237 0043 MORRINSVILLE Piako Tractors 07 889 7055 HAMILTON AGrowQuip NZ Ltd 07 847 0425 CAMBRIDGE AGrowQuip NZ Ltd 07 827 5184 ROTORUA Piako Tractors Ltd 07 345 8560
STRATFORD FieldTorque Taranaki 06 765 8643 GISBORNE Stevenson and Taylor 06 863 2612 WAIPUKURAU Stevenson and Taylor 06 858 6041 DANNEVIRKE Lancaster Tractors 06 374 7731 PALMERSTON NORTH Transag Centre 06 354 7164 MASTERTON Wairarapa Machinery Services 06 377 3009 NELSON Drummond & Etheridge 03 543 8041 BLENHEIM Drummond & Etheridge 03 579 1111 KAIKOURA Drummond & Etheridge 03 319 7119
*T&C’s apply, while stocks last, Gps compatibility may differ.
GREYMOUTH Drummond & Etheridge 03 768 5116 CHRISTCHURCH Drummond & Etheridge 03 349 4883 ASHBURTON Drummond & Etheridge 03 307 9911 TIMARU Drummond & Etheridge 03 687 4005 OAMARU Drummond & Etheridge 03 437 1111 MOSGIEL JJ Limited 03 489 8199 GORE JJ Limited 03 208 9370 INVERCARGILL JJ Limited 03 211 0013
RURAL NEWS // JULY 2, 2019
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34 MACHINERY & PRODUCTS / RURAL TRADER
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MARK DANIEL firstname.lastname@example.org
BIRDSCARER DE HORNER HOOF TRIMMER
THE HUMBLE Kiwi tip trailer looks like a distant memory, given the size of some units we now see on farms and roads. Farmers looking to get their fix of such behemoths had something to drool over on the 4Ag site
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at National Fieldays. Built in Portugal, the Herculano trailer displayed there comes from a company specialising in all forms of trailers from 10 to 50cu.m. This unit was shown in an interesting dual-purpose configuration. As a dump trailer it can hold about 19cu.m level-filled or 24cu.m heaped. Add a substantial harvest crate and capacity climbs to 50cu.m. The body is tapered for easy unloading, made from Hardox 450 ROC steel 6mm thick. This model has plenty of strength but a lower tare weight – about 11.5 tonnes – and its substantial chassis has a tridem (triple) axle layout. The unit at Fieldays was one of several operated by Grant Barber, a grass farmer and contractor at Himatangi,
The tip trailer on show at this year’s Fieldays.
Manawatu. He tows it usually with tractors about 230hp. The set-up has a K80 ball coupling, active steering and air brakes all combining for a safe operation. The tridem axle bogie uses front and rear steer-
NZ MADE BOOTS
The heavy duty sole construction makes this a robust boot designed for climbing over rugged ground. This boot has a soft toe and is made from a thick Mad Dog Nubuck Leather, stitched and screwed construction with a rubber, replaceable sole, that is glued and screwed. Soft padding for ankle support and D-Rings for your laces are an added advantage. Great fitting boots full of comfort, ideal for those long hunting and tramping trips.
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$1300 inc GST
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use: an integral PTOdriven hydraulic system, onboard weighing, auto greasing, hydraulically actuated rear door and rollover tarpaulin. It also has axle stabilisation during the tipping process.
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• Robust construction • Auto shut gate • Total 20 jets • Lambs only 5 jets • Side jets for lice • Adjustable V panels • Davey Twin Impellor Pump • 6.5 or 9.0hp motors
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Joiners supplied FREE with culvert pipes
RURAL NEWS // JULY 2, 2019
RURAL TRADER 35
SINGLE DOG BOX $605
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“I have no doubt that if I did not have a Quadbar fitted, my accident would have been fatal!” – Rozel Farms “The Quadbar saved our employee from significant injuries.” – Colin van der Geest
For a Quadbar, call me, Stuart Davidson, owner of Quadbar NZ, on 021-182 8115. Email firstname.lastname@example.org or for more info go to www.quadbar.co.nz
600 500 400 300 200 100 0
QUADBAR 5 YEAR SURVEY
NUMBER OF QUADBARS 479
NUMBER OF DEATHS 0
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P: 0508 326 8888 • www.thetankguy.co.nz 14 JULY A: 30 Turners RoadENDS – Feilding WHILE STOCKS LAST!
Boots! GUMBOOTS! RAINWEAR SALE! lace up
valued at $320
STEEL TOE (with Scuff Guard)
PLAIN TOE (without Scuff Guard)
steel TOE $50 valued at $120
Buffalo Leather - Dark Brown Soles stitched on through tread
$128 valued at $280
STEEL TOE (with Scuff Guard)
0800 16 00 24
Perfect 35cm Height
Shock absorbing heel
sold out of size: 7
PLAIN TOE (without Scuff Guard)
sold out of size: 7, 9
Wide Fit 175% more crack resistant leather
valued at $120
UV Resistant RUBBER Cotton Canvas Lining
Scuff Guard with Kevlar stitching
100% Waterproof Durable Seams Acid Resistant
sold out of size: 7, 13
sold out of size: 7, 11, 12
Sizing for these is the same as NZ WORKboot sizing (not NZ gumboot sizing). Available in sizes 6-11
Sizing for these is the same as NZ womens GUMboot sizing. Available in womens size 3, 4, 5, 6 (plain toe)
earthwalk, r d 2, palmerston north please add $12 freight per order
valued at $230 sold out of size: S, 2XL 3XL
valued at 160 sold out of size: XL, 2XL, 3XL
sizes: BOOTS 7 - 13 (NZ)
valued at $145 sold out of size: S, XL
RAINWEAR XS - 3XL
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Rural News 2 July 2019