The winding path for agri-food

[ This post was first published in the Fairfax NZ Sunday Star Times on 21 December 2014]

With another year winding down, it is time to reflect on how well the agri-food industries have been travelling, and to look forward to what the next twelve months might bring.

2014 will be the remembered as the year that the dairy industry started on the super highway but then hit a pot hole. Many in the industry expected a slow-down, but most have been surprised by the depth of the hole. It is also the year when the dairy industry began to recognise the full extent of the nitrogen leaching challenge. Continue reading

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Generating wealth from dairy

[This post was first published in the Fairfax NZ Sunday Star Times on 14 December 2014]

The current dairy downturn is inevitably turning attention to the wisdom of having so many eggs in the same basket. When times look rough, it can be helpful to look back and remind ourselves of the journey we have travelled to get where we are.

The driving forces that have led to the present have had very little to do with industry policy. Rather, the outcomes we are now experiencing are the consequence of thousands of individual farmers and rural investors deciding that dairy was where the profits lay. And to a large extent they got it right. Continue reading

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Small dairy farms can still be profitable

[This post was first published in the Fairfax NZ Sunday Star Times on 7 December 2014]

Last week I wrote about the changing scale of dairying. Farms are getting bigger and they will continue to do so, driven by the combined power of scale and financial leverage.

Unfortunately the title I supplied for that article (‘The changing scale of dairy’) was changed in the Sunday Star Times to ‘Dairy is all about scale’. This title implied that there was no future for small dairy farms. However, those of us working with farmers know that small farms can indeed be profitable, and there are many factors other than scale that influence that profitability. Continue reading

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The changing scale of dairy

[This post was first published in the Fairfax NZ Sunday Star Times on 30 November 2014]

Twenty five years ago, New Zealand dairy farms were genuinely family businesses. The average herd was about 150 cows grazing on 65 hectares. Less than 5% of farms had more than 300 cows. In total there were 15,000 farms milking 2.2 million cows.

By 2013 the average farm size had more than doubled to 141 hectares, and average herd size had increased to just over 400 cows. Nearly eighty percent of national production came from farms with greater than 300 cows. In total there were 11,900 farms milking 4.8 million cows. Continue reading

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Has Australia leapfrogged New Zealand in China?

[This post was first published in the Fairfax NZ Sunday Star Times on 23 November 2014]

The big agribusiness news this week is that Australia and China have reached a free trade agreement. This has come as somewhat of a surprise to our Government here in New Zealand who thought negotiations still had some way to go. They have been even more surprised at the apparent quality of the agreement. And our Australian cousins have been quick, entirely for their own internal purposes, to claim their agreement is better than what New Zealand achieved some six years ago. Continue reading

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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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