The latest statistic for on-farm dairy debt held by banks was $40.9 billion at October 2017. This equates to $22 per kg milksolids.
Despite the major upturn in dairy prices of more than 50 percent that occurred between July and December 2016, and with those improved prices then holding through much of 2017, there were lags for the increase to flow through into farm incomes. Debt therefore continued to climb through to July 2017 reaching $41.2 billion. It then declined by $285 million in the four months through to October 2017. Looking back ten years, the dairy debt remains more than double the 2007 figure of $18.8 billion.
The recent decline in debt is surely a positive sign, but in the greater scheme of things the recent decline is modest. Key questions remain as to the long term financial stability of the dairy industry. Continue reading
The big challenge for New Zealand dairy is how it can become sustainable in the coming decades. This sustainability includes both financial and environmental sustainability. And it needs to occur in the context of both scepticism and some antipathy from within the urban community.
One of the challenges for our new Government is to come to terms with the extent to which dairy and indeed the broader pastoral industries provide a key pillar that underpins the export economy. Without a vibrant export economy, there is no practical way we can address poverty and inequality within Zealand. However, that is not the way that many New Zealanders currently see it. And therein lies the challenge. Continue reading
For most New Zealand dairy farmers, the Mycoplasma bovis outbreak in South Canterbury is now little more than background noise. However, dairy and even beef farmers would be wise to recognise that it could still be lurking anywhere in New Zealand, waiting for the right circumstances to strike.
The whole saga of the outbreak has been poorly communicated.
The starting point for error has been the widely reported falsehood that it is on intensive confinement farms owned by the van Leeuwen Group. In fact, the disease has not been detected to date on any of the four robot-milked free-stall farms owned by this family. Rather it is on five outdoor farms that they own. Continue reading
Those of us involved with research relating to A1 and A2 beta-casein know all too well the challenges of publishing and disseminating that research. Given the extent to which beta-casein research challenges established positions, some of which are held by powerful entities, there are lots of speed bumps.
Events of recent weeks have once again illustrated some of those challenges. I lay out one such example below. Continue reading
[The article below was intended to be published some weeks back at The Conversation. The Conversation is the online portal, funded by Universities in Australia, New Zealand and the UK, where academics are encouraged to communicate and converse with non-academics. However, this particular article was blocked at the last minute by the Senior Editor(s) at The Conversation, having previously been approved within their editorial system. The Senior Editor(s) felt that the interests of associated commercial parties, who might benefit from dissemination of the article, were too great. A fuller story of that publishing saga will be posted shortly.
The content, formatting and supporting links are shown as originally agreed with The Conversation and reflect the prior input of one of their editors. This article can be freely republished, with or withut this foreword, but retaining the title as posted here, and with acknowledgements as to source [https://keithwoodford.wordpress.com].
Authors: Keith Woodford & Boyd Swinburn
Disclosures: See end of article
Type 1 diabetes, an autoimmune disease in which the body attacks its own insulin-producing cells, is on the rise globally.
Early evidence of an association between type 1 diabetes and a protein in cow milk, known as A1 beta-casein, was published in 2003. However, the notion that the statistically strong association could be causal has remained controversial.
As part of a seven-person team, we have reviewed the overall evidence that links A1 beta-casein to type 1 diabetes. Our research brings forward new ways of looking at that evidence. Continue reading
Whenever I write about the dairy price outlook, the key messages are about volatility and unpredictability. Nevertheless, right now the risks are weighted to the downside.
There is considerable nervousness within the export trade about the next GDT auction in early November. The auction acts as a barometer for the overall market.
This next auction will either confirm or reverse an emerging trend where buyers have been purchasing for immediate needs, but then quietly stepping back to the sidelines in regard to later deliveries. Continue reading
Fonterra’s 2017 financial performance was a solid result, despite profits dropping 11 percent to $745 million. The main cause of the drop was the higher farm-gate price of milk supplied by its farmers, which is a cost to corporate Fonterra.
This farm-gate price is based on commodity returns and is largely beyond the control of Fonterra. The decline in profit would have been much greater if it were not for a six percent reduction in operating costs.
It is these operating cost savings which have fuelled the more than $5 million bonus payments this year to CEO Theo Spierings. These savings can be directly attributed to the so-called V3 strategy which was Spierings’ baby.
The V3 strategy caused stress and heartburn amongst many Fonterra employees, including considerable numbers of staff who were made redundant back in 2015. But this year the results thereof have come through into the bottom line. Continue reading