Scratching beneath the surface of Fonterra’s accounts

[This article is published today at and is forthcoming in Farmers Weekly]

Fonterra’s loss of $196 million for the year ended 31 July 2018 has left nowhere for the Fonterra Board to hide. Wisely, it has chosen to take the loss on the chin. In line with this, it has completed the jettisoning of CEO Theo Spierings. Two of its most experienced directors (Wilson and Shadbolt) are also departing.

Fonterra plans to now take stock of the situation before charting a path to the future. However, the latest Fonterra communications at farmer meetings are emphasising debt reduction.

A black and white sort of a guy
New Chairman John Monaghan has been described to me as a black and white sort of a guy. That might be exactly what Fonterra needs; someone who calls a spade a spade and cuts through the public relations massaging that bedevils Fonterra. Continue reading

Posted in Dairy, Fonterra, Uncategorized | 8 Comments

China is the key market for New Zealand sheepmeats

[This post first appeared online at Stuff and some of their hardcopy newspapers on 4 September 2018, but alas with the first paragraph edited out and with the title “China demand for New Zealand sheepmeat booming”.  In the process,  key apects of the message were lost. Here is the full version]

Some weeks back I wrote how the New Zealand sheep industry is in a sweet spot, with record prices. I also wrote that China is now easily our largest sheep meat market by volume. Here I share the story of some of the things that have been happening in that market, and how demand for New Zealand sheep meats has potential to further increase. Continue reading

Posted in China, Meat Industry | 5 Comments

Methane narrative changes with less need for drastic reduction

[This article was published today (10 Sept 2018) at and is forthcoming in Farmers Weekly]

The recent note on methane emissions  put out by Parliamentary Commissioner Simon Upton in late August, and underpinned by a contracted research report written by Dr Andy Reisinger from the Government-funded New Zealand Agricultural Greenhouse Gas Research Centre (NZAGRC), will change the methane narrative. History will look back at Upton’s note as a fundamental contribution that moved the methane debate towards a logic-based science-informed position.

The key message is that short-lived gases such as methane do need to be considered differently than long-lived gases. That does not mean that they are unimportant. But lumping them together with long-lived carbon dioxide and nitrous oxide has led down false pathways.  Continue reading

Posted in Dairy, Meat Industry, Science ethics and communication | 4 Comments

MPI needs new thinking and more transparency

[This article is published at and is forthcoming at Farmers Weekly]

The Ministry of Primary Industries (MPI) is desperately in need of both new thinking and more transparency. It has a culture and internal power relationships which align with the military and police backgrounds of top-level managers.  MPI is also impacted by the dominant thinking from within the overarching State Services Commission, that top-level people trained in management do not need technical knowledge in the fields that they are responsible for.

Currently, MPI is led by a former Major General. The Mycoplasma bovis response team is led by a former policeman. The head of Biosecurity has no science-related qualifications. The next CEO of MPI will be transferring across from being CEO of Corrections. Continue reading

Posted in Agribusiness, Dairy, Mycoplasma bovis, Science ethics and communication | Leave a comment

Exchange rate reset will breathe new life to agriculture

[This post was published online at Stuff and also in most Fairfax Media New Zealand newspapers on 21 August 2018 as part of my fortnightly Stuff column]

The recent decline in the value of the New Zealand dollar is about to breathe new life into agriculture. It will take some months before the benefits flow through to farm level, but the macro signs are there to be seen.

The key question is whether we are seeing a strategic reset or is it just short term. My own thinking is that it is medium term through to around three years and maybe beyond, but with inevitable volatility. Beyond that I cannot see. Continue reading

Posted in Agribusiness, Dairy, Meat Industry | 1 Comment

Why is Fonterra so bad at international ventures?

Fonterra’s recently appointed Chair John Monaghan, in announcing the appointment of interim CEO Miles Hurrell, said that Fonterra wants to pause and reassess the way ahead.  This could be a breath of fresh air.  It needs to be a wind of change.

A starting question has to be why has Fonterra been doing so badly with its international ventures. This includes both international processing of milk and marketing of consumer-branded products. In the case of China, it also includes farming.

The so-called Fonterra Communications Division, but in reality the Fonterra Propaganda Division, has done a stalwart job over many years of painting over the cracks. But even those skilled operators have been unable to cover up some of the recent messes, particularly in China, but also elsewhere.

There are likely to be more awkward disclosures to come. More of that further down. Continue reading

Posted in Agribusiness, China, Dairy, Fonterra | 3 Comments

Sheep meats are in a sweet spot

[This post was published online on 7 August at and also in most of the FairfaxNZ newspapers]

This year has been an exceptional year for many sheep farmers.  Lamb and mutton prices have been at record levels.

The key drivers have been increasing demand from China combined with lower exchange rates. Sales to Britain have slowed down, linked to a ‘buy British’ campaign over there. But that has not been enough to counter the overall good news story.

Sheep farmers are telling me that, for the first time in many years, sheep farming is fun again. The cash is coming through to upgrade tracks and other infrastructure. Venison prices have also been exceptional for those sheep farmers who also farm deer. Most sheep farmers also run beef cattle and they too have been paying well. Continue reading

Posted in Agribusiness, Meat Industry | 1 Comment