In recent weeks I have been traveling in Western China. It is just over a year since I was last there, and as with every visit the changes are visible: more fast railways, more four lane highways, and lots more apartment buildings.
This visual perspective contrasts with what we are reading in the media about China’s declining economic growth. Which is correct? Well, both perspectives are valid. Continue reading
With calving in full swing, most dairy farmers have no time to think about anything but today. Things are indeed grim and the short term focus has to be on survival. For the next few weeks, there is some logic to focusing on the simple day to day things that can be influenced. Even in the good times, these are the things that often separate out the best from the not so good. Continue reading
[An earlier version of this post was first published in the NZ Herald on 11 August 2015]
There is no escaping that Fonterra’s path forward has to be closely linked to China. No-one else needs and has the ability to pay for New Zealand milk in the quantities that we have available to supply.
Whether that means we are over-exposed is a matter of perspective. But that perspective does not alter the reality that China is the opportunity. Whether or not the associated risks also become a reality is largely up to Fonterra itself. Continue reading
[This post was first published at http://www.interest.co.nz on 6 August 2015]
The failure to reach closure at the recent TPP negotiations in Hawaii may be a blessing for New Zealand. It may give some time for our negotiators to reflect on what we hope to achieve and what we are prepared to concede. Continue reading
Thursday 16 July was surely a black day for dairy and Fonterra. Not only did prices on the Global dairy trade auction prices drop to a record low, but Fonterra announced it was cutting 523 positions.
It was also a black day for New Zealand, as commentators and exchange rate speculators started to realise that the downturn was going to affect the whole economy. The exchange rate dropped close to 3% that day. Continue reading
For the last four years I have been promoting the notion that we need an integrated approach to selling New Zealand food online in China. Now the Aussies have gone and beaten us with ‘Australia Mall’ on China’s JD.com.
Chinese buyers increasingly want to want to buy their food online. They want food that is processed in a Western country. They also want a one-stop online shop. And they want same day delivery. Continue reading
Shares in The a2 Milk Company (coded as ATM on the NZX stock exchange) have increased from 48.5 cents on 29 May to 75 cents at 3 July. The market capitalisation has risen from $330 million to $495 million. Where the shares will go in the next few weeks is a journey into the unknown.
What is known is that some of the international big boys have been putting together a syndicate to purchase ATM (also listed jointly on the Australian exchange as A2M). The publicly announced parties are America’s Dean Foods and Australia’s Freedom Foods. But in the background are Australia’s Perich family, Australia’s Moxey family, and China’s New Hope agri-food conglomerate. And hovering nearby is Richard Liu from the rapidly growing Chinese online marketer JD.com. Continue reading