“Milked” (the movie) presents a sour view of our biggest export industry – but dairy farmers can learn from it it anyway

A documentary titled Milked,  shown  at the  International Film  Festival in Dunedin, seeks  to  “expose”  the  New Zealand  dairy industry   and  calls  on  New  Zealanders  “to  heal the  land”.

Milked is available globally via the streaming platform Waterbear and on Youtube via Plant Based News. The documentary is made by indigenous activist Chris Huriwai and local director Amy Taylor.

Its crowd-funding campaign surpassed an ambitious $100,000 target in just 12 days, with much international support confirming its global relevance. Huriwai  told  one  news  outlet:

“My wish for this film is that it empowers people to look at the problems we’re facing more holistically. If you’re looking for a solution, it has to encompass everyone within the system and their diverse perspectives. This film is about sparking that conversation”.

But is  NZ  looking  for  a  “solution?”

The   dairy industry is  a world leader not  just  in its  products,  but  in  its systems.

In a  review for Newshub, Daniel  Rutledge says: Continue reading ““Milked” (the movie) presents a sour view of our biggest export industry – but dairy farmers can learn from it it anyway”

Rabobank’s performance points to our farm sector being in good shape

Reflecting  the  surging prosperity in NZ’s  rural  heartlands, Rabobank  has  reported  an  after-tax   profit  of  $209m,  up $88m or  73%.

Rabobank NZ,  which is  owned in  the  Netherlands,  has  gained  ground  in  the  banking industry since  it  arrived  here in the  1990s by specialising in  lending to farmers  and  businesses in the food  and  agribusiness supply chain.

CEO  Todd  Charteris  says the strong commodity pricing over the course of 2021 enabled a number of clients to pay down debt which improved the risk profile of the portfolio and enabled the  bank to unwind loan impairments from the previous year.

“We remain positive about the long-term prospects for the [rural] sector and our intention is to further expand our agri-lending portfolio through new lending to farmers and other businesses across NZ’s food and agribusiness supply chain,” Charteris says. Continue reading “Rabobank’s performance points to our farm sector being in good shape”

Global dairy auction prices rise again but farmers are warned against premature celebrations

The  dairy industry’s  stellar  run  this  season is  moving  to a  new  level, just  when  the  national  economy  faces  fresh  pressures  from the  Covid  pandemic  and  rising  inflation.

The average price at the fortnightly global dairy auction rose 4.1% to US$4630 (NZ$6974) a tonne.  It was the second auction in a row with a rise of more than 4%.

Better  still, the average price for whole milk powder, which has the most impact on what farmers are paid, gained 5.8% to US$4324 (NZ$6394) a tonne, and is sitting 25% cent higher than at the same time last year. WMP rose 5.6% at the previous auction.

Fonterra, the world’s largest dairy exporter, last week lifted its  forecast payout this season to a record level as tight milk supply in NZ and overseas underpins demand. The latest strong auction result has prompted some to speculate that milk payments could move higher still. Continue reading “Global dairy auction prices rise again but farmers are warned against premature celebrations”

Capital restructuring is one big issue for Fonterra farmers – but they must respond to environmental challenges, too

Just  as  the  dairy  season  hits its  peak, Fonterra   farmer-shareholders   are  confronted with a  key decision on the  capital  structure  of the  big co-op. The board is  asking  them to  vote on the  proposal  at the annual meeting next month.

Consultation on the proposal with farmer-owners has been ongoing throughout the year, with some tweaks announced in September before a second round of discussions.  But Fonterra leaders have been clear they wouldn’t put the reform forward for voting if they believed the support wasn’t there

Farmers have  had  little  time to  enjoy  the  news  that  the  co-op  has  raised  its  forecast  payout  for  the current  season  to  a  record level.  Nor  is the  capital structure the  only  issue triggering  worry in the  cowshed.

The  government’s  focus  on climate  change, particularly methane  emissions, is  another matter weighing on the  industry, exacerbated by outfits like  Greenpeace shouting  the  odds  about “industrial  farming’’  and  “dirty dairying”. Continue reading “Capital restructuring is one big issue for Fonterra farmers – but they must respond to environmental challenges, too”

Dairy industry emissions depend on who does the measuring but Greenpeace presses for a culling of the herd regardless

Greenhouse  gas  emissions  from dairy farming  have  reached  an all-time  high – but emissions from the dairy cows themselves have dropped year-on-year.

Confused?

Well  you  might be.  And  to  many  it  might not matter  much, but  for  NZ’s  most important  export  industry, it looms  as  a  vital issue.

The  calculation depends – apparently – on who collects the  statistics. The first  is from Statistics NZ, the  second  from the Ministry  for the Environment.

Inevitably, the industry says the  second is the better measure because statistics which show dairy farming emissions have increased capture too many irrelevant categories.

Radio  NZ  reports  Stats NZ figures show dairy cattle farming emissions rose 3.18% (up 546.2 kt CO2-e to 17,719.4 kt CO2-e) between 2018 and 2019, the most recently reported year. This is the highest figure on record, dating back to at least 2007.

The Stats NZ figures count all emissions produced on dairy farms, regardless of what the emissions stem from. Continue reading “Dairy industry emissions depend on who does the measuring but Greenpeace presses for a culling of the herd regardless”

The world is keen on our dairy products, which is great for our economy – but what happens when we start culling the cows?

Although  global  trading patterns  are still recovering from the  Covid  pandemic, the  positive  outcome   for  New Zealand   is  that  it  has  strengthened  demand for  the  kind of foodstuffs we produce.

In particular  the   dairy  trade is booming  and  though  the current  production season is beginning to tail off, Fonterra’s latest global dairy auction showed  demand, far  from  falling off, is  still  very  strong,  with  prices  for  whole  milk  powder   51%  higher  than at the  level they were at  this time  last  season.

Dairy products are the country’s largest commodity export and Fonterra estimates milk payments to its 10,000 farmer suppliers for this season would contribute about $11.5 billion to the economy.

The  encouraging  factor   for those  producers  is  that  there  is  every sign  the   high prices  being  earned  at  present  will  be  sustained  into  the  next  season.

Last month, Fonterra raised its forecast milk price for this season to between $7.30 and $7.90 kg/MS, with a mid-point of $7.60.  Some  analysts  are   forecasting $7.70 for this season, ahead of Fonterra’s mid-point.For next season, the  forecasts  range between $7.30   and  $7.50.

While the global dairy trade price index slipped 0.1% from the previous auction a fortnight ago, prices for whole milk powder, which has the most impact on what farmers are paid, gained 0.4% to an average US$4097 (NZ$5713) a tonne.

What  may  be  an irritant  for  the  industry, currency  movements  are  taking  some  of the  gloss  off the  prices  being earned.

With the rising Kiwi currency, the latest auction brought overall prices -2.0% lower in NZ dollars. The key WMP and SMP prices were virtually unchanged in US dollars. The best performer was cheddar cheese, up +1.2% in US dollars but even that was not enough to record a gain in NZD.

The   strong  market  is largely driven by China where a wealthier population and an increased focus on health and wellbeing after the Covid-19 pandemic is stoking demand for better nutrition.

North Asian buyers were back in force, taking up their usual positions as the major buyer.

At the latest auction, 99% of the whole milk powder on offer was sold. There were slight  downward movements  with both of the cream group products. That was  attributed  in part to  the extra volume of butter on offer.

Fonterra  indicated previously it is producing more butter to take  advantage of the  high return for it. That was  sensible,  with butter topping $US5,100  a  tonne.

Given the  outstanding  work  of  the  dairy  industry,  how    will  the  government  react  when  it   comes to   deal  with  the  Climate Change Commission’s  proposal  to  cut  dairy cow  numbers  by  15%?

Rising world market prices for our dairy products give all of NZ cause to cheer

Covid-19 has  delivered a body blow to NZ’s international  tourism  industry and bruised university incomes from foreign students — but NZ’s  primary industries  are rising to the  challenge  and yielding impressive returns week  by week.  As  a  consequence, NZ’s  economy  is  not  sustaining  the  kind of Covid damage   which – for example –   lowered  the  United Kingdom’s  GDP  by 9% last year.

Defying predictions, the dairy sector has started  the  year   strongly.  Moreover,  lamb markets did not move down as  expected but have  marginally improved  while  demand  for beef  from China has been  strong.  Log   returns are  trending up.

On the  other  hand, in horticulture, the  results  so far  have been variable:  for  example  cherry orchardists’  crops  were devastated by  the weather.

For  primary  exporters  the  problems have come  from different quarters,  first  in logistical challenges and second   from the  currency  which  has  moved up  to 72USc.  Nevertheless,  the  basic  message  is  that  the  rural  economy   has helped to fill  the  gaps  left  by the  destruction  caused by  the  Covid-19 pandemic. Continue reading “Rising world market prices for our dairy products give all of NZ cause to cheer”

Why our dairy farmers should take their own climate-change initiatives rather than wait for govt regulations

Is the  Climate Change Commission’s draft proposals to meet  NZ’s emissions targets  as  radical  as right-wing commentator  Matthew Hooton contends, or entirely “doable”  as  leftie Simon Wilson  suggests?

The  draft budgets call on  the government to ensure  the  country emits on average 5.6% less than it did  in 2018 every year  between 2022 and 2025, 14.7% less for every year between 2026 and 2030  and 20.9% less  for every year between 2031 and 2035.  This is designed to get NZ to  zero net carbon emissions  by 2050 to avoid catastrophic climate change.

Prime Minister  Jacinda  Ardern, who has said dealing with climate change  is her government’s “nuclear  free moment”,  says she will introduce new policies  and a  new international climate target to meet the shrinking carbon budgets set out by the CCC.

For  the  dairy industry the challenge looks daunting:  herd numbers  will have to be  cut by 15% by 2030, assuming selective breeding reduces biogenic methane emissions  by 1.5%  by the same year.  From  2025, 2000 hectares of  dairy land  would be converted to horticulture annually. Continue reading “Why our dairy farmers should take their own climate-change initiatives rather than wait for govt regulations”

Dairy farmer confidence is improving but there are challenges in export markets

The dairy industry  has  recovered some  of  its  confidence, as  its  role  as the  backbone  of  NZ’s  export structure has  moved  into sharper  relief  in the  Covid-19  pandemic.

Rabobank’s  latest quarterly survey of  farmer confidence says  it  has improved from  minus 32%  to minus 23%, with  demand  for  NZ dairy products  holding up well  since the  previous survey  in September.

The  dairy  industry  over  past  seasons   has  been the  target  of  urban critics  for  so-called   “dirty dairying”, climate  change  warriors  who want a reduction in methane emissions,  and the  government, which is implementing  new  freshwater regulations. Internally the industry was  stricken  with  the  financial  woes   of   Fonterra.

Even  now  as the  industry absorbs the evidence  for greater  confidence,  it   is  not  without  strategic  concerns.    Most  of  these  are focused  on  its  Chinese markets  following  the  problems being encountered  by Australian exporters in the  wake  of retaliatory action by  the Chinese  government. Continue reading “Dairy farmer confidence is improving but there are challenges in export markets”

Dairy data should delight Covid recovery monitors while discouraging industry detractors

Farmers  are   back in the  frame  as  the  backbone  of  NZ’s  export economy,  after the  Covid-induced collapse of  the foreign  exchange earning capacity  of the  tourist  and international education industries.  But  it  is not  only  the  rural  industries themselves which  are  scrutinising bulletins  on  the  prices  being  earned  abroad  for  commodities.  Those data have  become a  vital  item  for  New Zealanders eager  to  monitor the recovery of an economy  battered  by a  one-in -100  year  event.

This  week  the  ANZ  reported  its  world commodity  price  index   had  eased  0.2%  in September as lower dairy and meat prices were largely offset by stronger prices for logs and fruit.

In local currency terms the index fell 1.3% as the NZ$ strengthened by 0.6% on a trade weighted index  basis during  the  month.

Hard on the heels  of those figures came   the  results   of  the latest  Fonterra  global  dairy   trade auction  where  the   average  price   strengthened  to  $US3143  a  tonne  and  wholemilk  powder (which  plays a  significant  role  on  Fonterra’s payout to  suppliers)  rose  1.7%  to  $3041  a  tonne.

Volumes sold were about the highest offered in 2020 and the most bidders of the year showed up for the  auction. Butter, up 8.4% to  $US3561,  rebounded  from  the previous  auction. Continue reading “Dairy data should delight Covid recovery monitors while discouraging industry detractors”