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Volume 02, No.6

February 13 - 19, 2002

Agribusiness

Crossbred Wool Hits 10-year High

Crossbred wool prices this week hit levels last seen more than 10 years ago, as buyers scrambled to fill orders in the face of a diminishing supply. The prices for some crossbred fleece types at Thursday's sale in Christchurch rose by 20% compared to the previous week, pushed by smaller volumes and China's return to the market. The strong wools indicator lifted 40¢ to 480¢/kg; the medium indicator surged 73¢ to 724¢/kg; the lambswool indicator went up 47¢ to 525¢, and the fine wools indicator lifted 70¢ to 1497¢/kg. In the sale of 11,983 bales, only 4% were passed in for failing to meet farmers' reserve prices. Southland Woolbrokers Ltd field representatives, Andrew Pope and Peter Christie, were confident that Thursday's prices were the highest for more than 10 years. (Southland Times)

Fonterra Warns of $5.20 Payout

Fonterra is warning farmers that its end-of-year payout may drop below the $5.40/kg of milk solids forecast in December. The company is advising shareholders at meetings being held nationwide this week that the payout could go as low as $5.20/kg. The company also told the NZ Stock Exchange that it was under some pressure because of reducing international commodity prices. Further increases in European Commission export subsidies, which push global prices down, could help bring the reduction, the company said. During the current season, milk prices had fallen from a high of more than $6/kg to slightly above $4.50/kg. Based on current commodity prices and exchange rates, the forecast for the 2002-03 payout was $4.50/kg, Fonterra said. (NZ Herald)

Superfine Wool Falls At Launceston

Superfine wool prices peaked at A8000¢/kg at Launceston's speciality sale this week, well below last year's top price. Growers delivered 19,000 bales for the sale, 2000 bales more than the same time last year, a reflection of the turnaround in the season. While three-quarters of the sale was medium Merino wool, 6000 bales of the glamour specialty wools were the highlight. Although superfine prices fell 20%, better returns for medium and broader wools lifted earnings for Tasmanian growers. The Northern Regional Indicator, which measures the Sydney market, passed through the A1000¢/kg barrier. Nearly 11,000 bales were offered in Sydney, with strong gains in all micron categories, pushing the indicator to A1008¢/kg before closing at A1003¢. The Eastern Market Indicator came back 4¢, to A985¢/kg clean. (ABC Rural News)

Australian Bidder Tries to Clear Path

National Foods has told the Commerce Commission that its "passive" shareholder, Fonterra, should not hinder its bid for New Zealand Dairy Foods. In an application to the Commission, National Foods said Fonterra's 18% shareholding in National Foods had been "essentially a passive one". Fonterra had not even taken up its entitlement to new shares under the National Foods dividend reinvestment plan. NF said it aimed to acquire up to 100% of Dairy Foods. Fonterra's shareholding did not entitle it to board seats under National Foods' constitution, and at its present level of shareholding, Fonterra could not influence decisions. National Foods said it would be beneficial to retailers and consumers if Fonterra was constrained by the presence of at least one strong, expert and viable domestic competitor across a substantial range of products. (NZ Herald)

Mainland Bid Wins Clearance

The Commerce Commission has cleared the second takeover bid by Fonterra's major domestic market supplier, Mainland, for Invercargill company, Southern Fresh Milk. The Commission blocked Dunedin-based Mainland's first move last May, ruling it could create market dominance in the South Island. Since then, Mainland's major local market competitor, NZ Dairy Foods ­ half-owned by Fonterra but to be sold by October ­ has built a town milk processing plant in Christchurch which could provide competition in the south. It is expected to produce its first milk next week. Southern Fresh, has a turnover of $20 million, including $6 million of mainly ice-cream and white-sauce exports to Japan and Australia. (Otago Daily Times)

Wool to Stay Above A$10/kg

The price of wool might never reach the heady heights of a pound a pound again, but it was set to stay above A1000¢/kg for 2-3 years, a leading analyst said. The Commonwealth Bank's commodity strategist, David Thirtell, said that in US$ terms, wool was still not on a par with prices in the mid-1990's. He said the market would stay strong for several reasons, not the least of which was that it would take some years to build up production again. There was a significant shortfall in supply ­ seasonally adjusted, stocks were at their lowest level for 7-8 years. Both the world economy and demand were picking up. The outlook for wool was 'quite rosy'. (ABC Rural News)

Dairy Brands Boosts Profit

Farm sales carried Dairy Brands NZ to a bottom-line profit of $3.36 million for the 6 months to 30 November. The sale of 10 farms netted a profit of $6.079 million, which offset a trading loss of $2.49 million, caused by last year's drought in Canterbury. The company handed over 7 farms to new owners in August, and is operating 4 farms, which have unconditional sales contracts due for settlement next June. (Christchurch Press)

Cavalier Lifts Half-year Profit

Carpet manufacturer, Cavalier Corp, lifted its net profit for the half-year to 31 December to $5.8 million, compared with $4.63 million in the corresponding period the previous year. The profit was on lower revenue of $78.5 million compared with $104.6 million, due to a downscaling of wool trading. Earnings before interest and tax from ongoing businesses were down 13% on the previous year, mainly because of weaker first-half earnings in the carpet business. The chairman, Anthony Timpson, said that with the carpet business now doing well and the best of the wool earnings still to come, tax-paid earnings of $13 million for the year were a realistic goal. (Otago Daily Times)

Big Tractors Popular

Otago farmers bought 246 new tractors in the year to 31 October, 2001, and the machines they bought and are still buying are bigger and more sophisticated ­ 70hp and larger. 3310 tractors were sold nationally. Otago Farm Machinery manager, Ken Luskie, said some farmers were trading in 2-3 tractors on one of the larger machines, in some cases worth up to $200,000, and getting it to do the work of several smaller models. Some had traded tractors that were 30 years old. The high prices of the big new tractors meant that farmers were treating them much better, aware of the size of their investment. (Otago Daily Times)

Nufarm Gains Roundup

Agricultural chemicals company, Nufarm, has been appointed exclusive distributor in Australia and New Zealand for Roundup herbicides produced by global plant biotechnology company, Monsanto. Nufarm will also buy Monsanto's selective chemistry business in Australia and New Zealand, which produce complementary products to Roundup. Nufarm spokesman, Robert Reis, said the company expected a 30% lift in its annual chemical sales from the distributorship. (Melbourne Age)

Pharma Zen Buys Waitaki Biosciences

Dunedin animal remedies company, Pharma Zen Ltd, has bought the Christchurch-based biotech products manufacturer, Waitaki Biosciences International Ltd. Pharma Zen chairman, Dr Max Shepherd, said there were synergies with the purchase as Waitaki Biosciences would add more production and international marketing capability, along with cash flow. Pharma Zen paid $3.4 million for Waitaki, which in the year to 31 March 2001 had revenue of $4.4 million. (Otago Daily Times)

AACo Up 136%

Australian Agricultural Co (AACo), one of the world's largest cattle companies (AgBrief 02-4), has reported a 136% increase in net profit after tax for the 6 months to 31 December. Stronger cattle prices drove earnings before interest and tax to A$41.2 million, up 142% compared with the result for the previous corresponding period. Net profit after tax rose 136% to A$28.1 million, aided by cattle revenue up 65% to A$68.4 million. (Sydney Morning Herald)

Trade

Canada Imposes New Beef Levy

NZ beef exporters are expected to face extra costs of $550,000/year on meat entering Canada. The Canadian Government has created a new levy on all domestic and imported beef, at a rate of $C1/head ($NZ1.50/head). Until now, Canadian beef producers have funded market promotion, development and research activities through their provincial associations, but the establishment of a national programme enabled Canada to extend the levy to imports. The new system is expected to generate an additional $NZ1.5 million/year, taking the total to about $NZ13 million/year, and it will be used to promote beef sales and consumption in Canada. (NZ Herald)

New Zealand Objects

Meat NZ market manager for beef, Bill Joyce, said the Board had strongly opposed the introduction of Canada's new beef levy. The Board had made detailed submissions on behalf of the NZ industry, and its Washington-based regional manager, Andrew Burtt, represented farmers and exporters at a hearing in Canada. The Board opposed any levy being applied to imported beef, preferring any funds raised on New Zealand beef to be used specifically to benefit New Zealand beef. The submissions had not defeated the proposal, but had led to the inclusion of two importer representatives on the 16-member agency being set up to manage the programme. (NZ Herald)

US Senate Passes New Farm Bill

After one of the most contentious agricultural debates in history, the US Senate has passed its version of a new Farm Bill, 58 to 40. The Senate's Bill asks for an extra $US2.4 billion on top of $US74 billion already allocated in the US Budget, to be paid to American farmers over the next 10 years. But it caps the individual subsidy per farm at $US275,000. The American Farm Bureau admitted there were fears that such a substantial Bill was against WTO rules, but Washington director, Mark Maslin, said farmers needed the subsidies. (ABC Rural News)

Howard Rejects Joint US Trade Talks

The Australian Prime Minister, John Howard, has rejected any obligation under CER to work with New Zealand on international trade deals, especially with the US. After a meeting in Sydney with the NZ Prime Minister, Helen Clark, he suggested Australia's prospects of making a deal with the US were difficult enough without New Zealand being involved also. There was nothing in CER that obliged either country to pursue international agreements on a joint basis, he said. Miss Clark will now put New Zealand's case for a trade deal with the US when she meets President George W Bush in Washington DC next month. She said New Zealand and Australia would liaise very closely on their respective discussions with the US. At some time 'down the track' the approaches might come together. (NZ Herald)

Trade Mission to Northern China

Trade Negotiations Minister, Jim Sutton, is to lead a trade mission to Northern China next month. So far, 21 companies and organisations have indicated that they will send representatives on the mission with him. Mr Sutton will travel to Northern China, visiting Beijing, Harbin, Dalian, and Qingdao, 4-15 March. The focus of the mission is to be on resource-based products and services, and will include several education institutes. Mr Sutton said China was not an easy market to break into. Next month's trade mission was aimed at helping exporters currently working in China to build on or to expand their business in the northern provinces. (Otago Daily Times)

Good Opportunities in China

Trade between New Zealand and China has grown considerably during the past year, with exports rising by over 47% to $1.3 billion in the year ending 30 November 2001. The Minister for Trade Negotiations, Jim Sutton, said China's accession to the World Trade Organisation last year, and the subsequent reduction in tariffs from January 1 this year meant there would be many new opportunities in the Chinese market for New Zealand exporters of goods and services. (Otago Daily Times)

New Zealander to Chair WTO Committee

New Zealand has been chosen to chair the negotiating group for one of the key issues in the new round of trade negotiations in the World Trade Organisation, Trade Negotiations Minister, Jim Sutton, has announced. The appointment of New Zealand's Geneva-based Ambassador to the WTO, Tim Groser, to head the rules committee was an indication of the high regard with which New Zealand was held, he said. The rules mandate covered some particularly sensitive issues, such as anti-dumping and subsidies provisions. Mr Groser will chair the negotiations on WTO rules until the 5th Ministerial conference in Mexico in 2003. (NZ Herald)

Grapes Now, Apples Next?

Australia's quarantine agency has agreed to let table grapes from California into Australia. The grapes will be imported under a strict quarantine policy, including fumigation and inspection by Australian authorities before they leave the US. Australian growers are concerned that Californian grapes will bring in Pierce's Disease, which has devastated US crops. Biosecurity Australia's Mary Harwood said the new rules were tough enough to keep out the disease. The measures had been checked by CSIRO, and had also been worked through with state plant quarantine officials. (ABC Rural News)

Trade Spin-offs from Minister's Visit

New Zealand's animal husbandry and pasture management has caught the attention of Turkey's Minister of Agriculture and Rural Affairs, Professor Husnu Yusuf Gokalp, who is on week-long visit. He said Turkey was moving to improve pastures and introduce fodder crops for winter feeding. A lot of fodder-crop seed would be needed, and New Zealand could be a supplier. Turkey has 30 million sheep, 8-9 million beef cattle, and 4 million dairy cattle, but the quality of the dairy cattle was not high. Professor Gokalp showed a strong interest in Lincoln University's new dairy farm during a visit on Monday. (Christchurch Press)

Aus-NZ Co-operation on Meat Research

Meat NZ and the Australian Meat and Livestock Corporation have agreed to increase their co-operation on research and development projects that would benefit farmers in both countries. Meat NZ and the AMLC are already working together on some programmes, and Meat NZ chairman, Jeff Grant, said they had decided to take this further. They intended to review all projects in both organisations that had a 'public good' value for farmers and try to sort out who would take the lead in specific projects. (RNZ Rural Report)

NZ Cheese Under Fire

A court in Saint Omer, northern France, has fined a local cheese importer, Boudringhin SA, for importing New Zealand cheese and calling it Emmental. The plaintiffs were a group of French cheesemakers. They said at least 22 tonnes of "fake" cheese were offered for sale. Their secretary-general, Michele Roche, said the yellow-coloured cheese did not have any holes or a crust ­ it was a fake. Boudringhin director, Jacques Boudringhin, said the ruling was protectionism. The cheese had been imported from the NZ Dairy Board as Emmental and had been scientifically tested in France as such. (NZ Herald)

Chilled Lamb Prices Steady

Slaughterings of UK lambs and hoggets were 30% down at 11.6 million head for the year ending 30 December. But despite UK imports from New Zealand being 12.6% down for the year, UK retail shares remained virtually unchanged at 55.4% for British lamb and 32.2% for NZ lamb, Meat NZ reports. Chilled lamb sales are now under way and prices are very similar to this time last year. (Meat Matters)

Major Increase in Quarantine Fines

The Australian Federal Government has dramatically increased the fines for breaches of quarantine. Company fines have increased more than 1000%, to a maximum A$1.1 million, and on-the-spot fines have been doubled. Carson Creagh, from the Australian Quarantine and Inspection Service, said tougher penalties would deter would-be smugglers of meat, fruit and vegetables. The basic penalty for a minor quarantine breach has doubled from A$110 to A$220. Fines for large-scale corporate breaches have gone from a previous maximum of A$60,000 to a very hefty A$1.1 million. (ABC Rural News)

$23 million Trade Surplus

Revised trade figures have imports slightly down on an earlier forecast, but New Zealand's trade balance was still much better in December than previously expected. Statistics NZ said there was a surplus of $23 million. Economists had forecast a $71 million deficit. It was the first December surplus since 1996. (The Dominion)

Australia Coming Out of the Trough

Australia's Reserve Bank is expecting the country's economic growth to strengthen, reinforcing its decision to leave interest rates untouched after a series of cuts in December pushed them to a 30-year low. In its latest statement, the RBA points to rising confidence at home, growing signs of international recovery, and new life in key commodity markets. It also expected inflation to ease as strong productivity outstripped moderate wage growth. The weak A$ has helped to boost the country's terms of trade. (NZ Herald)

China Releases Wool Quotas

China has announced its wool quotas for this year and they are up by 2%-3% on last year. China's global quota for raw wool is just under 265,000 tonnes, and slightly less than a third of that is allocated for the processing or re-export trade. The global quota for wool tops is 72,500 tonnes clean. Bob Quirk, executive director of the Australian Wool Industries Secretariat, said the long-awaited release of the quotas was expected to keep demand and prices strong. (ABC Rural News)

International Food Safety Conf.

Modern approaches to ensuring meat and poultry hygiene will the focus of a big international conference on food standards and safety in Wellington this week, 18-22 February. About 140 international government delegates and industry representatives will be attending. It is the first meeting of the Codex Committee on Meat and Poultry Hygiene since 1993. It will be chaired by Dr Andrew McKenzie, group director of MAF Food Assurance Authority. In April, New Zealand will host another international meeting ­ the Codex Committee on Milk and Milk Products. (NZ Herald)

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Livestock

More Ostrich Farmers Needed

Export demand for ostrich meat exceeded the NZ industry's ability to supply, and more farmers were needed to finish birds, farm consultant, Katherine Ball, said. Ostrich farming was now well established and had reached the stage the deer industry had been in the 1970s. Based at Rangiora, Ms Ball is co-ordinating a 2-year MAF-funded project to improve the profitability of ostrich farming. One of the objectives is the production of a manual on ostrich farming. Commercial beef and deer farmers were taking on 40kg-50kg chicks and growing them to about 100kg finishing weights at 10-14 months. About 80% of the annual meat production from the 8000 birds killed is exported. (NZ Herald)

Rustlers Cost Farmers Dearly

Ohakune police are concerned by a recent spate of stock rustling going on in the Waimarino countryside. During the first week of February a Pipiriki farmer lost 500 sheep from his property, all of which carried his earmark. With the price for mixed age ewes around $80 the loss could be worth in the vicinity of $40,000. Detective Graeme Rumble said this was the third stock theft in the past few months and stock trucks were almost certainly used as transportation. In January, an Ohakune farmer reported 386 ewes and lambs taken, and his neighbour lost 135 lambs as well. (Wanganui Chronicle)

Emu Plant Nearly Ready

The first emu abattoir built in New Zealand is nearing completion at Waimana, Bay of Plenty, and is due to begin production in 4 weeks. Roely De Raad, an emu farmer and part-owner of New Generation Emus Ltd, said he decided to set up the plant when he realised that emu farmers in New Zealand were trying to establish an industry but had nowhere to process their birds. The new plant will be able to process up to 100 birds/day. (Whakatane Beacon)

US Sheep Numbers Still Dropping

Sheep numbers in the US have continued to drop, with the total number of sheep and lambs at 1 January 2002 standing at 6.69 million, down 4% from 2001 and 5% below 2 years ago. US sheep numbers peaked at 56.2 million in 1942. The 2001 lambing rate was 110%. The number of farms with sheep was 1% down at 65,120. (Meat Matters)

Horticulture

Gibbs Coup Attempt Fails

Former Enza chairman, Tony Gibbs, made an abortive bid to regain the pipfruit exporter's top job at the expense of one-time investor colleague, Bill Birnie. In a surprise move at the AGM in Nelson this week, Mr Gibbs, of major Enza corporate shareholder Guinness Peat Group (GPG), urged shareholders not to re-elect Mr Birnie and fellow directors, Brian D'Ath and Richard Hill. The three had stood down by rotation under the company's constitution, but sought re-election. Hawke's Bay pipfruit growers' spokesman, Jonathan Wiltshire, said the three directors were re-elected by a narrow margin, thanks mainly to his Hawke's Bay proxy votes. (NZ Herald)

Enza Changes Constitution

At its AGM in Nelson this week, Enza announced that it had changed its constitution so that it will no longer be necessary to be an orchardist in order to hold shares in the company. It leaves the company able to list on the Stock Exchange, and finally ends the producer board deregulation process. Company chairman, Bill Birnie, said that for the first time, anyone could buy and sell Enza shares. The changes had significant value implications for shareholders, he said, and orchardists should seek independent advice before making any decisions about their holdings. (Nelson Mail)

$2 billion in Hort Exports Expected

Horticultural exports are expected to exceed $2 billion in the year ending 30 March 2002, all going well, says a MAF report. Hort exports are expected to rise by 1% to $2.04 billion, mainly reflecting a rise in apple prices moderated by a fall in kiwifruit prices. By March 2005, horticultural export value is expected to have increased to $2.22 billion, mainly reflecting growth in wine exports from $226 million to $325 million. (The Orchardist)

Produce Prices Up 8%

Fruit and vegetable prices shot up 8.1% during January, the 2nd-biggest monthly increase in 5 years, Statistics NZ said. The only significant drop was in kumaras ­ down 14.8%. NZ Fruit and vegetable Growers Federation chief executive, Peter Silcock, said months of unrelenting rain across New Zealand had spoilt crops, causing a national shortage. The Retail Fruiterers Federation said the reported 8.1% rise gave the impression that fruit and vegetables were expensive. But, according to the federation, carrots, pumpkins, potatoes, onions and lettuce were the same price or slightly cheaper than they were 12 years ago. (NZ Herald)

Beekeepers Endorse Varroa Testing

The NZ National Beekeepers Association has endorsed the Varroa Management Group's decision to test and treat all known hives within 5km of Waiouru to ensure that local bee populations have not been exposed to the varroa bee mite. The precautionary decision follows the placement of a 5km movement control zone at Judgeford, north of Wellington, where a swarm of infected bees was found inside a hollow log (AgBrief 02-5). MAF discovered that the truck transporting the log had stopped at Waiouru for approximately 30 minutes on 16 of January. (Wanganui Chronicle)

Grape Crops Looking Good

The Wine Institute of New Zealand expects the 2002 grape crush to be about 120,000 tonnes, compared with 71,000 tonnes last year, a 70% increase. The lift comes from a return to a more normal yield and new plantings. The vintage will come from nearly 13,200ha, 1500ha, or 13%, up on the previous year. The harvest begins this week in Gisborne and continues in other regions until the end of May. (Hawke's Bay Today)

Aerial Search for Phylloxera

Central Otago's grape-growing districts are to be photographed from the air using infrared cameras to try to identify any vineyards that have been infested with the vine pest, phylloxera. Central Otago Winegrowers Assn president, Steve Green, said an information kit would also be produced to help growers' identify whether the louse was present. Phylloxera was found in an Alexandra vineyard last month. (Otago Daily Times)

Fighting Phylloxera May Cost $5 million

Fighting the phylloxera aphid, which threatens to invade Central Otago's vineyards, would cost the industry at least $5 million, Central Otago Winegrowers Assn president, Steve Green, said. There were 500ha of grapevines in the region, with 45% planted on unresistant rootstocks. Each new resistant rootstock would cost $5-$6, with an average of 2000 vines per hectare, plus labour costs for replanting. (Southland Times)

Wine Scholarship

A new $5000 scholarship is being offered by the NZ Society for Viticulture and Oenology to encourage the development, promotion or awareness of innovation in grape production and wine making. The society's aim is to support new ideas within the New Zealand grape and wine industries. Applications close with the NZSVO on 26 March. (Marlborough Express)

Soil, Land, Water, Arable

Irrigation for 600 Farms

Plans for a $235 million irrigation scheme for North Otago, which would supply some 600 drought-prone farms, have been unveiled in Oamaru. Gravity Irrigation Co says its proposal to irrigate about 50,000ha on the North Otago downlands and in the Waiareka and Kakanui Valleys has the potential to boost farm income by almost $125 million/year, and the regional economy by up to $372 million/year. The capital cost is estimated at $238 million. A gravity canal would draw water from the Waitaki River. Company chairman, John Cheeseman, said the scheme would require a partnership between the Government, local authorities, local communities and the farmer-users. The next step will be a detailed feasibility study. (Otago Daily Times)

Wairarapa Irrigation Scheme

Masterton Business Enterprise has received enough support from farmers to proceed to the next stage of a proposed multi-million dollar irrigation scheme in Wairarapa. Enterprise co-ordinator, Geoff Copps, said more detailed engineering work would be carried out and a search for alternative water storage areas would also be undertaken. The engineering study was expected to be completed by October. (Wairarapa Times-Age)

New Insects to Control Hieracium

Two more insects are being released to control hieracium. The Hieracium Control Trust and Landcare Research have released a gall midge near Tekapo, and a hover fly is due to be released in North Canterbury next week. This follows on the earlier release of a gall wasp at 52 sites, including the central North Island, with establishment already confirmed at 15 sites. A plume moth has also been released into the Mackenzie Basin, and a rust and a powdery mildew are widely dispersed. A fifth insect species has been approved and will be released next summer. John Aspinall, chairman of the Trust, said it was the culmination of a $1.4m programme targeted at implementing a biological control programme for hieracium. (Otago Daily Times)

Redevelopment for Totara Estate

A $226,000 redevelopment of Totara Estate, the birthplace of New Zealand's frozen meat industry, was announced at the 120th anniversary celebrations this week. The estate, south of Oamaru, supplied the sheep for the first shipment of frozen meat to leave New Zealand, aboard the refrigerated vessel Dunedin in 1882. Major supporters of the redevelopment of the estate include Meat NZ, PPCS, Alliance Group and ANZCo. Several other meat companies have also made contributions. In 1982, the meat industry and other groups bought Totara Estate for the Historic Places Trust and restored the buildings in a major centennial project. (Otago Daily Times)

Industry

Meat and Wool Venture Ratified

The Meat and Wool Boards have reached agreement to combine the operations of WoolPro, Sheep Improvement Ltd, the Meat and Wool Economic Service and the Meat Board's research and development activities into a single organisation. The new company will be the largest non-government investor in research in the New Zealand sheep and beef sector. It will be primarily farm-focused, but will continue to provide existing services to the wider industry. The new company ­ jointly owned and funded by Meat NZ and the Wool Board ­ will be established during the next few weeks and a senior management team will be appointed by its board of directors. (NZ Herald)

$60 million Deal Threatened

Fonterra has signed a $60 million contract to research genetic modification in the dairy industry, but it says the high cost of regulations may force it to cancel the deal. Fonterra told a Parliamentary Select Committee meeting in Auckland that it was still considering moving its genetic research overseas, despite the Government's approval for controlled field trials. Fonterra Enterprises manager, Alexander Toldte, said the cost of complete containment of field trials and destruction of heritable genetically modified material afterwards could make research costs in New Zealand prohibitive. Both Australia and the US were more attractive alternatives to New Zealand for GM research and development. (NZ Herald)

Where Has All the Wool Gone?

Wool exporters are questioning industry estimates of sheep numbers as they try to cope with a wool supply shortage. Wet weather has put shearing a month behind in many areas, causing a significant drop in the wool available for auction at what is normally the peak of the season. Michael Dwyer, managing director of Wool Services International, said there was a feeling that there was more behind the shortfall than just the wet season. As well as the late season, it appeared that the quantities of wool were 'just not there', he said. He hoped that the higher prices would lead to restocking of flocks and a halt to the downward trend. (RNZ Rural Report)

Fonterra Elections

Three of Fonterra's farmer directors will be up for re-election this year. They are the deputy chairman, Greg Gent, Earl Rattray and Gerard Lynch. Nominations for election to the 13-member board will be called next month and postal voting has to be completed by 31 May. The Shareholders Council has recommended that the election process be changed to a preferential voting system. Voting would still be on the basis of milk solids production, but shareholders would cast votes for their first and second preference for the position. The system, which could be operating in time for this year's election, would be used to show a clearer majority for the winning candidate. (NZ Herald)

Meat NZ Processor Directors

Two directors, nominated by processing companies, have been re-elected unopposed to the Meat Board. Graham Harrison, ANZCo Foods Ltd, has been re-elected unopposed after completing his 3-year term. Colin Francis, Davmet NZ Ltd, was elected unopposed. A further vacancy remains unfilled and will be discussed by the Board at its March meeting. (Meat Matters)

MAF Investigators Seize Fonterra Papers

MAF investigators probing the Powdergate illegal exporting scandal have used search warrants to seize documents from Fonterra sites. MAF Food dairy products director, Tim Knox, said the sweep of several North Island properties was part of a systematic information-gathering process. The searches were not an indication of a sudden escalation of the investigation. MAF was simply working its way through a thorough investigative process and would continue to do so until it had reached a conclusion. (NZ Herald)

Moratorium Will Stifle Investment

Federated Farmers says that the proposed 2-year moratorium on applications for the commercial release of genetically modified organisms from containment is unnecessary and will stifle R&D investment. The Royal Commission on GM recommended the introduction of a new "conditional" release category, as proposed by Federated Farmers, Mr Polson said. It was extremely disappointing that the HSNO Amendment Bill did not address conditional release. If the legislation proceeded, the Prime Minister's vision that biotechnology would elevate New Zealand to a higher growth plane would never become a reality, he said. (Wanganui Chronicle)

Regulation Holding Biotech Sector Back

The Government's fine words in its innovation policy needed to be followed by actions, said a biotechnology proponent. Life Sciences Network chairman, Dr William Rolleston, said the biotechnology sector would welcome the supportive framework described in the policy statement. But while the Government acknowledged the growth potential in biotechnology, the sector was being held back by an over-cautious regulatory environment. The current moratorium on field trials of genetically modified organisms and the lengthy process required to get permission for research was discouraging innovation in New Zealand. (NZ Herald)

Export Meat Production

In the 18 weeks of the 2001-02 season to 2 February, the number of lambs slaughtered for export was 7,469,468, down 1.24 million or 14.4% compared with the same period last season; hogget production was down 33.6% at 5080; mutton was down 1% at 2,364,267. The number of steers slaughtered for export was down 28.6% at 136,390; heifers slaughtered were down 4% at 49,115; cows slaughtered were down 10.2% at 113,228, and bulls were down 8.3% at 229,271. Total beef slaughterings for export were down 14.6% at 528,044. Bobby veal production was up 58% at 147,983, and goat slaughterings were up 10% at 18,436. (Meat Matters)

Lower Lamb Kill Still Fills Orders

Although more than a million fewer lambs have been processed at meat works than at this time last year, exporters have still been able to meet commitments to the vital pre-Easter European market. The reduced kill was mainly in the South Island, where widespread wet weather slowed supply, particularly during January. MIA executive director, Brian Lynch, said that while there had been plenty of grass, cold temperatures meant it was not nutritious and stock did not gain condition. The last ships taking chilled lamb to Europe for the pre-Easter trade leave this week. (Southland Times)

Better Butter Cuts Cholesterol

Initial trials by Auckland University's Human Nutrition Unit of a new type of butter have shown it can reduce cholesterol levels by as much as 10% ­ a drop the Heart Foundation says lowers the risk of heart disease by 15%-20%. The modified butter is made from milk produced by cows that have been fed a particular type of grain mixed with a vitamin supplement. The modified milk was developed at the New Zealand Dairy Institute in Palmerston North, a research centre owned by Fonterra. (NZ Herald)

Farmers Angered By Suggested Petrol Tax

Federated Farmers of New Zealand is angered by suggestions that the Government intends to impose an additional 4¢/litre fuel tax on all New Zealanders to pay for Auckland's transport problems. Vice-president, Tom Lambie, said that if successive Governments had not been 'pandering' to local government 'patch' protection and had got on with much-needed road reform, innovative approaches could be in place for Auckland now. If the Government was too weak to face up to the politics of local authorities, then it should stop siphoning off current petrol taxes into consolidated revenue and instead fund Auckland's transport problem from the existing taxes, he said. (NZ Herald)

Verry Wants Compensation

The Wool Corporation is seeking compensation from the Wool Board for money spent trying to reform the wool industry and may initiate legal action in the High Court to get payment. Corporation chairman, Phil Verry, said he deserved fair monetary compensation from the Board for the many hours of work carried out in recent years for the industry good. Board chairman, Bruce Munro, confirmed that the Board had been informed of the legal moves and that communication on the issue had been going on for some time. (Straight Furrow)

Westland's Chief Executive

Westland Milk Products has appointed Dr Barry Richardson as its chief executive. For the past 11 years he has been general manager of Tatua Nutritionals at Tatua Co-op Dairy Company. Westland's chairman, Ian Robb, said Dr Richardson brought experience in added-value products, an area that the West Coast dairy company would be investigating. (Greymouth Evening Star)

Forestry

1.80 million hectares of Planted Forest

New Zealand's planted production forests covered 1.80 million hectares at April 2001, the Ministry of Agriculture and Forests reports. The Central North Island has 577,000ha of planted forests ­ 32% of the national total. They are also the country's most mature, currently producing 52% of the NZ wood supply. Northland, Gisborne, Hawke's Bay, Southern North Island, Nelson-Marlborough, and Otago-Southland also have significant areas of maturing forest. (Hawke's Bay Today)

Radiata Pine Dominates

Radiata pine dominates New Zealand's forest estate ­ 1.61 million hectares or 89% of the total plantation forest area, a new MAF report says. Douglas fir covers 103,000ha, with 34,000ha in other softwoods and 54,000ha in hardwoods. About 67% of the radiata pine forest is under a pruning regime, and the area of pruned forest approaching harvestable age is increasing. Around 1 million hectares of the pruned radiata pine is 25 years old or younger, with about 167,000ha between 21 and 25 years old, and 79,000ha older than 25 years. (Otago Daily Times)

New Planting Has Declined

Over the last 2 years, the rate of new planting of forest trees has declined below the long-term average rate, a new report by MAF says. The area of new planting in 2000 was 33,600ha, and it is provisionally estimated that 31,600ha were planted 2001. The average new planting rate over the last 30 years has been 45,200ha/year. Between 1992 and 1998, New Zealand experienced high afforestation rates ­ averaging 69,000ha/year. In 2000, 35,700ha of harvested area were replanted, making total plantings 69,300ha. The area of restocking is expected to continue to increase in line with forecast increases

in harvesting, the report says. (Hawke's Bay Today)

Land Use

In the 2000 calendar year, 52% of the land that was either planted in trees for the first time or replanted was on former improved pasture land, 31% on unimproved pasture, and 17% on scrub. In 1993, 28% of new planting was on improved pasture, 56% on unimproved pasture, and 16% on scrub, MAF reports. (Otago Daily Times)

19 million m³ Harvest

For the year ended 31 March, 2000, MAF estimates the total forest harvest was 19 million m³, with 18.3 million m³ coming from clear felling, and the balance from production thinning. (Otago Daily Times)

Exporters Woo China

Timber exporters are gearing up for a concerted push into eastern China, beginning with a top-level trade delegation to Shanghai next month. The 20-strong delegation, representing 15 sawmilling and wood processing companies, will go to Shanghai and Ningbo as part of a Trade New Zealand move to open the Chinese domestic market to NZ pine. Trade NZ sector manager, Stuart McGeorge, said NZ timber sold well in southern China, but was little known in eastern regions. The chairman of the NZ Pine Exporting Companies Asia group, Bill Giller, said rapid economic progress in eastern China presented great new opportunities for NZ timber exporters. (NZ Herald)

Minister's Faith in Forest Sinks 'Futile'

New Zealand's forest sink credits were not a panacea to the challenges that the Kyoto Protocol would present to New Zealand, the president of Federated Farmers, Alistair Polson, said. The Minister of Forestry, Pete Hodgson, had said that forest sinks meant New Zealand had a net benefit of $1 billion from ratification of the Kyoto Protocol during the first commitment period (2008-2012). Mr Polson said the $1 billion value would only be a net benefit if the Government retained full responsibility for New Zealand's emissions and forest sinks. This was highly unlikely, given the likely high compliance costs, especially for small woodlot owners and farm foresters. The Government should delay ratification and adopt realistic policies. (Gisborne Herald)

Paperlinx Net Profit Up 24%

Recent acquisitions by Paperlinx have helped deliver Australia's biggest paper maker a 24% increase in net profit and offset collapsing demand caused by the global economic downturn. Record sales achieved on the back of the Spicers and Coast Paper acquisitions, combined with the low cost of imported pulp and stable paper prices in its communications papers business, contributed to a better than expected first-half profit of A$64.8 million. Sales soared 80% to A$1.52 billion in the 6 months to December 2001, reflecting the consolidation of Spicers Paper and Coast Paper. Managing director, Ian Wightwick, said the company was in talks for further acquisitions in North America and Europe. (Sydney Morning Herald)

Tb Scare at Mill

A Northland man is in hospital with tuberculosis and 28 of his workmates have tested positive for the disease. All the men work at Northland Mill, Juken Nissho's extended lumber mill just north of Kaitaia. A loader-driver at the plant contracted Tb last month and is in isolation in hospital. Those exposed to the disease will undergo further tests and x-rays. (NZ Herald)

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