The dairy robots are coming

[This post was first published in the Fairfax NZ Sunday Star Times on 16 November 2014]

Milking cows is far from exciting. People milk cows for money and not for fun. What if it could all be done by robots?

Well, those days have come. Already there are at least 16 New Zealand commercial dairy farms with robot milkers and the number is increasing rapidly. In Scandinavia and the Netherlands in particular, but also elsewhere in Northern Europe, there are now thousands of these robots. They are also coming to America. Continue reading

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The restructuring of Silver Fern Farms

[This post was first published in the Fairfax NZ Sunday Star Times on 2 Nov 2014 under the title ‘Breaking up the family silver’]

During 2014, I have written several times about the challenges of restructuring the meat industry. I have described the period we have been going through as akin the phony war as all sides prepared for battle, but everyone waiting for someone else to make the first move. Now, within the last ten days, we are seeing the first signs of action.

The key announcement, easy to miss within a wide-ranging media release covering multiple topics, is that Silver Fern Farms is restructuring into species specific business units. This contrasts a decision reported in the 2013 Annual Report that Silver Fern Farms had re-organised its sales on a geographical rather than species basis. Continue reading

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The New Zealand dairy dilemma

[This post was first published in the Fairfax NZ Sunday Star Times on 2 November 2014]

New Zealand earned more than $17 billion in export income from the dairy industry for the 12 months ended August 2014. This was one third of our total export income. Quite simply, without dairy, our economy would go into free fall. Yet many New Zealanders are inherently negative about our largest industry. The problem is that dairy is perceived as polluting the rivers of New Zealand. Continue reading

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Seasonality drives the red meat industries

[This post was first published in the Fairfax NZ Sunday Star Times on October 26 2014.]

I have previously described the challenges that seasonality creates for the dairy industry. For New Zealand’s red meat industries, those issues are even more constraining. It is a key part of the reason why restructuring the meat industry is so challenging.

Sheep are designed by nature to give birth in the spring, and their fertility is much reduced at all other times of the year. Given that the market predominantly wants carcasses of 17 – 20 kg, this means that most lambs are ready for slaughter between December and April, with the peak slaughter in a shorter period from January to March. Continue reading

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The rising star of beef

[This post was first published in the Fairfax NZ Sunday Star Times on 19 October 2014]

With so much focus on the current dairy downturn, it is easy to miss the rising star of beef. This year beef prices have been hitting record highs, both in US and NZ dollars. Young steers and bulls are fetching anywhere between $1100 and $1600 at slaughter, depending on weight and category.

The key driver has been demand for hamburger beef from the United States. Demand from China has also been increasing. Continue reading

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Riding out the dairy downturn

[This post was first published in the Fairfax NZ Sunday Star Times on 12 October 2014]

The latest Global Dairy trade auction of 1 October has placed a new complexion on the current dairy downturn. There is now widespread concern that the downturn is going to be longer and deeper than almost everyone had expected.

Rabobank’s latest quarterly report on global dairy prospects is also just published and there is no good news in that. Rabobank is suggesting it could be the later part of 2015 before there is a substantial turnaround.

European and American production are both increasing. New Zealand production is also buoyant. On the demand side, Russia has shut the gates on dairy imports from Europe because of the Ukrainian crisis. The Chinese are still buying but not fast enough. The dollar is high and may stay that way, despite efforts by the Reserve Bank to nudge it down. Continue reading

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With a free trade deal Australia can win China’s dairy market

[This post was written primarily for Australian readers at the request of ‘The Conversation’, an online daily newsletter. It was published in ‘The Conversation’ on 8 October 2014 and from there published elsewhere in Australia under a Creative Commons license. For the original article go to:

https://theconversation.com/with-a-free-trade-deal-australia-can-win-chinas-dairy-market-31681.

For further information about ‘The Conversation’ go to:
 https://theconversation.com/au/who-we-are ]

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Global demand for internationally traded dairy products is now dominated by China. Although Australia has benefited from this, with annual dairy exports to China now worth over A$500 million, the growth has been much slower than what New Zealand has achieved.

Latest New Zealand statistics to June 2014 show annual dairy exports to China of A$5.05 billion (NZ$6.05 billion). These exports have increased more than tenfold since 2008. Continue reading

Posted in Agribusiness, China | 1 Comment