Volume 99, No. 40

October 13 - 19, 1999

Agribusiness

Lamb Prospects Strong

Farmers should plan on receiving better prices for lamb this season, meat processors say. The new season opened on 1 October, and Alliance Group chief executive, Owen Poole, said the company anticipated that lamb prices would be up this year. World stocks of sheep meat were low, and last season's over-supply of competing proteins, such as pork and poultry, had now improved. The market for sheep co-products, such as pelts and renderables, had also bottomed and was starting to recover, he said. Lamb was also being moved up the value chain to segments of the market that could pay more. AFFCo's general manager for livestock, Athol Murray, also believes the outlook for lamb is good this season. The depreciation of the NZ$ was being reflected in what the industry was paying suppliers. He believed current prices to farmers were sustainable over the next 2-3 years, but exchange rate movements were the big unknown. (NZ Farmer)

Shares Limited to Farmers

The compromise dairy industry ownership deal thrashed out at last week's weekend-meeting of the country's Big Three dairy companies proposes that farmers alone will hold the 2 classes of shares in the proposed mega co-op for now. Establishment board chairman, Graham Calvert, said the shares, whose values would fairly reflect farmers' investment in factories and marketing, would be tied to milk supply. One share would be in the manufacturing and ingredient, or commodity, business and would not pay a dividend. The other would be in the higher-risk consumer products business, which is predicted to grow rapidly and have the most chance of raising industry returns. It would pay a dividend. The deal brokered between NZ Dairy Group, Kiwi and Northland dairy companies has ruled out the selling of those shares to outside investors in the short term. The structure would be reviewed in 2-3 years, Mr Calvert said. (NZ Herald)

Meat Board Optimistic

Lamb had been repositioned into niche markets and, unlike other commodity food products, prices were continuing to rise, said Meat NZ chief executive, Neil Taylor. Lamb had been differentiated from pork and poultry by further processing and focusing on the top end of the market where consumers tended to buy on consistent quality and country of origin. He said the outlook for lamb was excellent and sustainable. World sheep numbers were falling and New Zealand's greatest competition in the marketplace came from sheep producers in importing countries. Lamb markets were currently firm and producers should see a lift in schedule prices. (Southland Times)

Farmers Face Freight Increases

Farmers would soon be hit by freight rate rises of more than 3%, Road Transport Forum chief executive, Tony Friedlander, said. In the past 4 months, fuel costs in the road transport industry had risen 22%-30%. A survey last year had shown that the average profit margin for commercial road transport operators was 2.9% on total turnover, which was a very fine margin. The recent diesel price hikes would give operators no choice but to raise freight rates for all customers. In North Island rural areas, fuel costs were 12.5% of a carrier's total operating costs. (NZ Farmer)

Farmlands Lifts Rural Gloom

North Island rural retail co-operative, Farmlands, has reported a record after-tax profit, record sales and a record bonus rebate to a growing shareholder base. The Hawke's Bay-based co-operative said sales increased by $11 million to $180 million, with most of the lift coming from its 24 retail stores. After-tax profit increased 44% to $2.5 million, $1.5 million of which is to be paid back to farmer and grower shareholders; the number of shareholders increased by 500 to 12,800. A 25th store will be opened in Levin by Christmas. (The Dominion)

Richmond Takes Waitotara

Hastings-based Richmond has closed a takeover deal with Wanganui's Waitotara Meats, cementing the Hawke's Bay company as the North Island's largest meat processor. The deal, which will cost Richmond about $1.75 million, gives Waitotara shareholders $2.3 million in cash and 7.3 million shares in Richmond. (NZ Herald)

Alliance to Focus on Sheep Returns

South Island meat processor Alliance is switching its emphasis from debt reduction to better returns for producers. Chief executive, Owen Poole, said the Alliance equity ratio was now 58%-60%, a substantial improvement on the under 20% of the early 1990s. The 60% equity ratio was adequate and allowed for a buffer against adverse changes in the industry. The company was aware that sheep and beef numbers were falling as farmers switched to other land uses, and it was now essential that sheep farming was made profitable to encourage producers to remain in the industry. (Otago Daily Times)

Ravensdown Beats the Odds

Fertiliser co-op, Ravensdown, overcame a weak NZ$, rising costs, and drought, to keep 1999 sales within 4% of last year's record level. Fertiliser sales in the year to 31 May were 1.064 million tonnes, compared with 1.1 million tonnes the previous year. The chairman, Jim Pringle, said Ravensdown managed to hold or reduce prices, despite some rising import costs. The 1999 profit was down 3.2% on last year's $25 million. Sales income was $262.6 million, compared with $277.1 million previously. Mr Pringle said the company's purchase of Fernz Corp's Taranaki assets and its expansion into the top half of the North Island continued to pay handsome dividends. (NZ Herald)

Medium Wool Prices Slump

Prices paid for medium-strength wools slumped badly at Thursday's Christchurch and Napier wool sales. The medium indicator fell below the important $4/kg mark to 390¢/kg, down 11¢ from the previous week's Christchurch sale where the price declined by 5¢/kg. The fine wools indicator also slipped on Thursday, by 3¢/kg to 885¢. The strong wools indicator slowed its rise, up 2¢ to 370¢, compared with the previous week's boost of 8¢. A big jump in the lambswool indicator, up 9¢ to 326¢, was on only a limited offering at the sale. (The Dominion)

Fernz Posts $4 million Loss

Australia-bound Fernz Corp, which is changing its balance date, said profits and turnover in a truncated 2-month period were down on the same 2 months of 1998, but ahead of budget. Fernz is moving its head office to Melbourne and will change its balance date from 31 May to 31 July. It said its forecasts for the 2000 period were unchanged. Fernz believes profits will double within 5 years of the move to Australia. The chairman, Bill Wilson, said 40% of sales now came from Australia and only 9% from New Zealand. A New Zealand regional office will operate from Auckland. (Otago Daily Times)

240 Jobs to Go at Belfast

Two chains and about 240 jobs will be axed from the PPCS Belfast plant in Canterbury. Workers were told at a meeting with management on Tuesday. Processing general manager, Geoff Rowe, said one chain in the beef plant would be retained and the company wanted a 40% increase in production. The plant has not killed stock for 7 months. (Christchurch Press)

Cut-price Power Offer to SI Farmers

Electricity generation company, Mighty River Power, said its cut-price electricity offer to NZ farmers would be extended to the South Island through Dairy Group retailer, Anchormart. The energy deal was announced in June when MRP said it could save Waikato and Bay of Plenty farmers about $4 million/year on electricity bills. About 1500 of NZ Dairy Group's North Island suppliers have signed up. The company has now extended the deal to Southland and Canterbury dairy farmers. (Otago Daily Times)

Dairy Brands Voting on Manager

Shareholders in corporate dairy farmer, Dairy Brands, will vote on 22 October on a proposal to appoint a contract manager to run the company. The proposed manager is Agriculture Resources, a company set up for the purpose and owned 50% by Farmers Mutual Investment Services and 50% by Lyn Williams and Dairy Brands director, Cliff King. (Christchurch Press)

Trade

WTO Backs Test Case on Milk Subsidies

The World Trade Organisation's appeals body has upheld a WTO disputes panel ruling that Canada's 'special milk classes' scheme subsidises Canadian dairy exporters in ways which contravene WTO rules. The scheme discounts the price of milk used in the manufacture of cheese and butter for export, and New Zealand and the US took a case against it to the WTO last year and won. Canada appealed and has now lost again. The Minister for International Trade, Lockwood Smith, hailed the result as proof that the WTO worked. The outcome demonstrated the value to a small, export-dependent country like New Zealand of the WTO, which had enforceable rules and did not let economic or political weight dictate. (NZ Herald)

Dairy Board Heartened

New Zealand's success in appealing Canadian dairy export subsidies at the WTO would reduce opportunities for larger exporters to flout trade agreements, the NZ Dairy Board said. The decision would have no immediate or dramatic impact on any NZ product its real significance lay in the principle it had established. A clear and strict definition of what constituted an export subsidy had been confirmed. It reduced the opportunities for other, much more significant exporters than the Canadians, to subvert their WTO obligations. (Otago Daily Times)

NZ to Challenge US Lamb Tariff

New Zealand this week lodged a request for a WTO panel to rule on the legality of the US decision to impose tariffs on imports of NZ and Australian lamb, the Minister for International Trade, Lockwood Smith, said. The panel will be asked to determine whether the US measure is consistent with WTO rules. New Zealand and the US had consulted, as required, but could not resolve the matter. The NZ Government maintained that efficient producers should not be penalised for successfully marketing a quality product to consumers in offshore markets, and the request for a WTO ruling was the next step in the Government's efforts to challenge the legality of the US decision to impose restrictions on New Zealand's lamb industry. (Christchurch Press)

Australians Too

Australia has upped the ante in its dispute with the US over tariffs on Australian lamb, and will take a complaint to the WTO. Australia's Minister of Trade, Mark Vaile, said discussions with the US had failed. (Evening Post)

Troubles in South America

Venezualan Customs authorities are now taxing NZ milk powder shipments at the correct rate of duty, 40%, which was the rate agreed to under WTO rules. For more than a year they had been charging 50%. The NZ Dairy Board's global external policy manager, Nigel Mitchell, said there would be no refund of the $5 milllion overpayments. Meanwhile, Brazil is considering a dumping action against outside suppliers, including New Zealand, Australia and the EU, following complaints from its dairy farmers, who are feeling the effects from competition on the depressed international market. However, their primary focus is on imports from Argentina and Uruguay. Chile is also considering what action it can take to reduce the impact of competition from imported dairy products on its farmers. (RNZ Rural Report)

Decision Due on GE Labels

Australian and NZ Health Ministers will decide this week how to enforce labelling rules for genetically engineered foods, which could set a precedent for other countries. The Australia and NZ Food Authority has proposed that the regulations should come into effect about a year from now, which would be ahead of labelling regulations due to come into effect in Japan from 2001. (Evening Post)

EU, South Africa in Free Trade Accord

South Africa and the EU swept aside last-minute objections by France and signed a long-awaited free trade agreement that will phase out tariffs on about 90% of their trade. The accord was signed in Pretoria after approval from EU ambassadors in Luxembourg. (Christchurch Press)

NZ Feta Gains Foothold in US

An award-winning Balclutha-made sheep's-milk Feta cheese has gained a promising foothold in the US market. Dairy Sheep Products started making the cheese last year. This year it was named Tradenz Best Export Cheese in the NZ Cheese Awards. General manager, Riza Kibar, said the company had so far exported 66 tonnes to Australia, New York and Los Angeles. It was selling well in the US, where it was competing successfully against imported French feta, and distributors had agreed to take 100 tonnes in the coming season. (Southland Times)

APEC Food System a Winner

A study of the APEC Business Advisory Council's APEC Food System showed that its implementation had the potential to add US$55 billion-US$112 billion to consumers' spending power in the region by 2005, the Minister for International Trade, Lockwood Smith, said. While the system advocated trade liberalisation and facilitation, it also provided programmes to develop rural infrastructure and disseminate technological advances. (Manawatu Evening Standard)

Feds Not Resourced For WTO Talks

Federated Farmers is hard pressed to raise enough money to send a team to the WTO meeting in Seattle next month. Chief executive, Tony St Clair, said any gain made in freeing up trade in world agricultural products would be of benefit to New Zealand, and it was unfair that the cost of representation should be borne only by federation members. New Zealand's roving agricultural ambassador, Malcolm Bailey, said that for the task facing Federated Farmers at world trade talks, the organisation was under-resourced compared with with other countries, including Australia. (The Dominion)

Port Blockade

About 700 British farmers protested at Plymouth this week at the arrival of a ferry from France and vowed to blockade ports across the country if France did not lift its illegal ban on British beef. Targets of the protest were lorries laden with French farm produce. France has said that British beef could cross the country in transit to other countries, but insists that it still poses a threat to human health. (NZ Herald)

Livestock

Strict Control Wanted on Antibiotics

The NZ Veterinary Assn believes that unrestricted access by farmers to several over-the-counter antibiotics is inappropriate in today's safety-conscious society and should be stopped. The antibiotics are available for pork, poultry and calf producers to use as growth promotants. NZVA chief executive, Dr Murray Gibbs, said there was intense concern world-wide at the resistance patterns that many bacteria were building up to antibiotics. So far, most of it came from human use, but evidence was accumulating that antibiotic use in animals was a potential source of resistant bacteria. Allowing unrestricted access to such products in New Zealand did nothing to allay consumers' fears about unsafe food, he said. (Taranaki Daily News)

NZ Scientist Finds Early BSE Clue

A New Zealand scientist has discovered that BSE, or mad cow disease, may have simmered undetected in Britain for 10 years longer than researchers believed. Massey University veterinary epidemiologist, Prof Roger Morris, and head of a research team for the British Government, has concluded that mad cow disease started in Britain's prime dairy region in the southwest in the early or mid-1970s, but it was in such small numbers of cattle that it was not identified as an unusual disease. The epidemic may have started from as little as a single animal, which infected the next group in the 1970s, which in turn produced the national epidemic. (The Dominion)

Deer Farmers Disappointed

Deer Farmers Assn president, David Stevens, said AgResearch's decision to end Invermay Research Centre's programme of breeding for bovine Tb-resistant deer was disappointing. The study began in 1992 but ran into funding problems in 1998 when the Foundation for Research and Technology declined to renew the contract. An independent review by Massey University Professor, Dorian Garrick, concluded that breeding for resistance would not be a practical option for reducing Tb until it could demonstrate 3 specific factors, and research to investigate those factors would involve considerable cost and could not be undertaken in a short time-frame. (NZ Farmer)

Wrinkle-free Merinos

Wrinkle-free and hornless Merino sheep will be the style of the future, according to Dr David Scobie, AgResearch Lincoln. In an address to an Agricultural Science Merino Forum, he said Australian and NZ research available since the 1960s showed sheep with wrinkles were less productive than smoother skinned animals, although there might be some extra wool. Wrinkly lambs were prone to difficult births, had slower growth rates, and needed mulesing. Wrinkly ewes and rams had decreased fertility and were more difficult to shear. Ribby pelts were often unsaleable. There were smooth-skinned Merinos in most flocks, and farmers with an eye to the future should be identifying and breeding from them, and some had already started on that path. (Otago Daily Times)

Co-op Plan For Mobile Abattoir

Canterbury deer and emu farmer, Dale Weavers, has initiated a co-operative of emu farmers wanting to put their stock through a mobile abattoir. The unit will be designed for the export trade and for operation by 2-3 people. It will be a small-capacity unit, able to kill up to 50 emus and to pluck, skin and dress the meat. As emus do not transport well, and with their numbers increasing, the mobile unit is much needed in the industry, he said. (NZ Farmer)

Attempt on Shearing Record

Grant Smith of Canterbury will try to break the world Merino wether shearing record on 4 November. He will have 9 hours to shear more than 405 sheep. The attempt will be made at Ryton Station, Lake Coleridge. (Christchurch Press)

European Mill Wants Wanganui Wool

After 7 years of research into wool quality, Wanganui stud breeders, Ross and Richard Orr, have signed a deal to supply a major European mill with 33 bales of their ewe hogget wool. The mill liked the quality and colour, but were most impressed that the micron measurement came in tighter parameters. The Orrs believe that reducing the micron variation in crossbred wools may be the key to the future viability of the NZ wool clip. A former analytical chemist, Ross began laser-scanning fleece samples 5 years ago. He believed that Merino breeders, with their concentration on fibre diameter and breeding out coarse fibres, were about 30 years ahead of other breeds. (NZ Farmer)

Horticulture

Grim Picture For Orchards

The Ministry of Agriculture and Forestry has painted a grim picture for apple orchard incomes for the coming season and predicts that many pipfruit orchards will be leased or sold. It forecasts an average loss of $36,000 next season, based on projected incomes for 32 orchards surveyed. (Evening Post)

Enza in Joint Venture in Britain

The NZ Apple and Pear Marketing Board is linking its British operations into a joint venture with listed British food group, Geest Plc. The joint venture, Enzafruit World Wide Ltd, will be owned by Enzafruit UK, the Board's British marketing arm, and Geest World Wide Fruit, a division of Geest Foods. Enzafruit will continue to control the supply of fruit and will pay the joint venture a commission on the sales it makes. The new business will have a turnover of £100 million (NZ$330 million). The Board said the move was a step in its plan to become a year-round global marketer of fruit. (NZ Herald)

New Late-season Cherry

A new cherry, believed to be the latest-season variety so far, has been developed by a Central Otago orchardist. Summerfruits Orchards managing director, Earnscy Weaver, said the Sweet Valentine variety would be harvested 7-10 days later than the Sweetheart variety in mid-February. The new variety was large at about 28mm, with a 'sweet and chunky' taste. Mr Weaver estimated that 5000-6000 Sweet Valentine trees had been planted in Central Otago this year and expected plantings to double next year. The first commercial exports were expected in 2001. Sweet Valentine was a chance discovery when Mr Weaver found late fruit on a tree in a block at Earnscleugh in 1994. Summerfruit NZ Export Council chairman, Basil Goodman, said the new variety had great export potential, especially to Asia and Europe. (Southland Times)

Avocado Orchard Investment

In New Zealand's first public offering for an avocado orchard investment, the promoters are seeking $1.5 million to buy and plant a 24ha Northland farm. Spokesman, Murray Foster, said the end market was huge. Avocados were a long-term staple part of millions of people's diets around the world. The Californian market alone consumed in about a week the entire annual NZ export production of 1.2 million trays. Investors are being asked to pay $19,500 for one share in Norris Road Avocados Ltd, a new company incorporated earlier this month. The Whangarei orchard is expected to produce around 70,000 trays/year from year 8. (The Independent)

Montana to List in Australia

Montana Group expects to list on the Australian Stock Exchange this month. Managing director, Peter Hubscher, said no new shares were being issued in the listing process. The listing was aimed at providing broader access to investment capital. Many retirement funds could not invest in the company because it was listed only on the NZ Stock Exchange. To reports last month that Australian brewer, Fosters, had put up a bid for Montana, Mr Hubscher said the company was unaware of any bid. (The Dominion)

Pinot Noir Festival

Wellington will host a major celebration of New Zealand Pinot noir wines in January 2001. International wine experts, Jancis Robinson, James Halliday and Robert Drouhin, have been confirmed as speakers for Pinot Noir 2001, which will include a conference, wine tastings and cooking demonstrations. About 100 NZ wineries will set up stalls at the Basin Reserve and present their Pinot noir wines, alongside those from Australia, the US and Burgundy, the French home of the Pinot noir grape. (Evening Post)

Chinese Challenge Growing

China is rapidly becoming a major producer of apples and poses a threat to New Zealand's place in export markets, according to David Cranwell, Hawke's Bay-based technical consultant to Empire World Trade, a British fruit procurement and marketing company. He said China had massive plantings of apples, more than 2 million hectares, and a large percentage of them less than 7 years old. Shaanxi province alone would be producing 4 million tonnes of apples/year within 5 years. He believed the NZ apple industry had 2 years to counter the threat and secure its future in the international pipfruit industry. (Hawke's Bay Today)

Land, Soil, Water, Arable

More Funding to Combat Pasture Worm

The Government is to provide more funding for research to find a weapon against Northland's latest pasture pest, the tropical grass webworm. The worm wiped out large areas of kikuyu pasture in parts of Northland last summer, and farmers say it has survived the mild winter and fear it will continue to spread through the region. The Government granted $20,000 earlier in the year for research and to monitor webworm populations over winter. The Minister for Biosecurity, John Luxton, has now announced a $9000 boost to help to identify chemicals or biological controls that are effective against the webworm. Two chemicals, already registered in NZ, will be tested. Mr Luxton said that if they worked, farmers would have 2 chemical options that were environmentally safe and cheap to apply. (RNZ Rural Report)

Dry Otago Warning

Weather forecaster, MetService, has added its voice to predictions that parts of Otago are headed for another dry spell. The service is predicting Otago will be drier, not as windy, and with more sunshine and higher temperatures over the next 2 months. There was a better than 50% chance that a La Nina summer would bring the region dry weather like last summer. The predictions are similar to warnings from the National Institute of Water and Atmospheric Research. (Otago Daily Times)

Get Better, Not Bigger

Unless pastoral farmers got better at what they did, there was no point in getting bigger, Roy Fraser, AgNZ meat and fibre manager, Waipukurau, told the Grasslands Conference in Napier. The real opportunities for most farmers lay within the farm gate. The fence-and-fertilise programme for hill country and the fence-fertilise-and-regrass programme for the flats still offered the opportunity for a profitable investment. (NZ Farmer)

Landowners Want $94 Million

Maori landowners are suing the Government for $94 million in a bid for compensation for leased land. Paul Morgan, deputy chairman of the Federation of Maori Authorities, said the $94 million would recover losses dating back to 1977. Twelve trusts and incorporations owning land on the west coasts of the North and South Islands, and in Wellington and Palmerston North, are seeking urgent action in the High Court. (The Dominion)

Farmers Oppose GM Wheat

Canterbury wheat farmers say they will not benefit from a proposed trial of genetically modified wheat at Lincoln. North Canterbury Federated Farmers grains section was likely to make a submission to the Environmental Risk Management Authority, opposing an application to test Roundup-resistant genetically modified wheat in the district. (Christchurch Press)

Ryegrass Results Verified

Aries HD and Quartet perennial ryegrasses topped the performance of 6 ryegrasses tested in a lamb grazing trial in Canterbury. The work was carried out by AgResearch for Wrightson Research, to compare new ryegrass cultivars against standards such as Grasslands Nui. Quartet gave lamb liveweight gains of 37.4kg and 36.1kg in the first 2 years of the ongoing trial. Aries HD produced liveweight gains of 35kg and 35.9kg. Grasslands Nui resulted in gains of 22kg and 23.7kg in years one and two. (NZ Farmer)

Producing More From Less

A UN Environment Programme study has shown that in India, China and the US, the area of land used for farming has not increased since 1961, but India has increased its crop production by 130%, China by 270% and the US by 115%. The report concludes that if each country had continued with its old farming methods, it would have had to triple the amount of land in farming to achieve the same levels of food production. In New Zealand, in the same time, the amount of land under cultivation declined 6% to 16.6 million hectares, yet grazing animal numbers increased by 39%, major crop production rose by 58%, wool production was up 4%, meat production rose 71%, and milk production increased by 131%. (Fertiliser Matters)

Safe Endophyte 15 Months Off

Farmers will have to wait until after January 2001 for a new ryegrass endophyte which has high insect resistance and does not cause staggers or heat stress. John McKenzie, NZ Plant Breeding and Research Assn, said several cultivars of ryegrass had been successfully innoculated with the new endophyte, and they were being bulked up ready for commercial release. (NZ Farmer)

Super Beats Wana Cocksfoot

Superphosphate was a much better short-term investment than oversowing with Wana cocksfoot, researchers at AgResearch's Balantrae Hill Country Research Station have found. The investment in Wana was not paid back for 8 years, but as Wana pastures were known to last for 20 years, the benefits would continue. (NZ Farmer)

Industry

All or Nothing, Says Storey

Outgoing Dairy Board chairman, John Storey, warned farmers to accept their proposed mega-merger as a package deal or not at all. In his final address to the Board's annual meeting, Mr Storey said the structure which had been recommended was a complete package, 'not a wish list to be cherry-picked, based on political acceptability'. He warned dairy farmers against believing the proposed mega co-operative was an end in itself. Rather the new business the industry was trying to create was a local version of structures used successfully world-wide to overcome the risk of inefficiencies often associated with a big company. The recommended strategy came from a logical, robust and thorough process and offered the best opportunity to generate wealth and expand earnings. (Southland Times)

Watchdog Not on Leash

There was no chance of the Government legislating to overturn any Commerce Commission ruling against a mega dairy co-operative, the Minister for Food and Fibre, John Luxton, said. At the Board's annual meeting he was asked if the Government would change the law to overturn the Commerce Commission ruling, but he ruled that out. Competition law was very important, and those who thought the Government would let the dairy industry avoid competition law were pushing water uphill. (Evening Post)

WDFF Now RWNZ

On 15 October, World Rural Women's Day, the Women's Division of Federated Farmers, officially became Rural Women New Zealand - the organisation's 350 branches celebrated the day. Rural Women has a new Web site >www.ruralwomen.org< which has an online forum for women for discussion of rural and women's issues. RWNZ president, Margaret Millard, said communication was the key to the organisation's effectiveness. Rural women were often isolated and the Internet site would offer them the opportunity to access relevant information and to discuss issues. (The Dominion)

Product Reform Act Over 3 Years

The new Animal Products Act 1999, much of which comes into force on 1 November, will eventually replace the Meat Act 1981 and the Apiaries Act 1969. The new Act will be implemented over a 3-year transition period - until 31 October, 2002 - with the 2 former Acts operating in parallel except for a few key areas export provisions, cost recovery, and homekill. (NZ Farmer)

Contracts Threaten Lamb Killing

The threat of industrial action hangs over the start of the new South Island killing season, with meat workers resisting new contracts being offered by employers. Dunedin-based PPCS is seeking new contracts at its plants, and Invercargill-based Alliance Group wants a new contract at its enlarged Lorneville works before the season gets fully under way. The secretary of the Otago-Southland Meat Workers Union, Gary Davis, said most workers opposed the new contracts, which they believed would mean working harder and for longer hours but for no penalty pay. (Otago Daily Times)

Australians Adopt Quality Standard

Australia is establishing its own form of New Zealand's domestic meat industry Quality Mark. The new quality assurance is called Meat Standards Australia (MSA) and also carries the caption, 'tenderness guaranteed' or 2 other appellations - 'premier tenderness' and 'supreme tenderness'. Beef carrying the quality label went on sale in Sydney this week and has been available in southern Queensland since June. Meat and Livestock Australia will spend $1 million advertising the MSA mark over the next 6 months. It is backed with a full money-back guarantee if the product does not perform according to its label. (NZ Farmer)

Blunt Report Assured

McKinsey and Co has promised wool growers complete, brutal candour in its controversial performance review of the Wool Board. Growers are suspicious that the international management consultancy is not independent enough to make a frank investigative summation of the Board's position, and they could veto the $1.7 million study at the Board's annual meeting in Rotorua this Tuesday. McKinsey principal, Andrew Grant, said the company jealously guarded its independence, and its representatives refused to take the soft options. "We feel an absolute accountability to farmers and wool growers," he said. (Christchurch Press)

Kellogg Course Open Again

Approval has been given for another Kellogg Rural Leadership Course at Lincoln University after funding support from the NZ Primary Industry Council. Professor Tony Zwart, head of Lincoln's professional studies school, said the grant would allow the school to take in 24 future rural leaders and give them the training opportunity enjoyed by more than 300 past scholars. (NZ Farmer)

Forestry

CHH Lifts Sales For 2nd Quarter

Carter Holt Harvey's 2nd-quarter sales to 30 September were up 16% at $790 million, compared with $680 million for the corresponding period last year. Sales for the 9 months to 30 September were $2.31 billion, against $2.41 billion in the same period last year. Warburg Dillon Read analyst, Stuart Graham, said a pulp price rise from US$460/tonne to about US$580/tonne earlier this year had contributed to the sales improvement, along with increased demand for timber from the NZ housing industry. Merrill Lynch analyst, Simon Gresham, said the Asian economic recovery had also affected Carter Holt's sales. The company had had price increases in all of its commodity groups. Asia was recovering, the US market was very strong, and the Australian market was reasonably good, and that had flowed back and had an impact on export prices, he said. (The Dominion)

West Coast Milling Contracts Signed

The Minister for State-owned Enterprises, Tony Ryall, revealed on Thursday that Timberlands West Coast had signed 9 beech-milling contracts in late August and early September, before the Labour Party announced its policy to end beech logging on the West Coast. The existence of the contracts had not been made public in mid-September when Labour announced its policy and said it would honour existing contracts for the milling of rimu until 2007. Labour would have to decide whether to break the contracts or break its promise to end the logging of beech forests, Mr Ryall, said. The contracts allow for up to 58,000m³/year, and are conditional on Timberlands getting resource consent. (Otago Daily Times)

Contracts a Sham, Says Labour

Contracts for the milling of Crown-owned West Coast beech forests were such a sham that a Labour-led Government would not need to break them, the party said. Leader, Helen Clark, and forestry spokesman, Pete Hodgson, both suggested the contracts were invalid and dismissed Government claims that Labour would have to break the contracts if it was to keep its promise to end Timberlands West Coast's logging of beech forests. Mr Hodgson said the contracts were a political ploy and could not have been negotiated in good faith. They had been signed without any tenders being called, without any resource consents, and without regard for the possibility that a new Government would not want the logging to proceed. (The Dominion)

Wood Exchange Makes Global Plans

A New Zealand-developed electronic commodity exchange for wood, Global Ecomex, may be extended internationally following discussions in several countries. Talks with Singapore may also mean the centre of the company's operations moving to Singapore from New Zealand. Ecomex director, Jeff Barker, said relocation to Singapore could bring funding from the Singaporean Government and practical help from the large pool of qualified IT people in the territory. Ecomex has been under development and operation in New Zealand for 4 years. There are now 70 seats on the exchange,

secured by NZ companies, including forest and woodlot owners, sawmillers, builders and manufacturers of wood products. Ecomex is negotiating a possible deal to sell the NZ rights to its operation to Wood NZ, the body developing markets for the local industry. (The Independent)

Forestry Versus Farming Debate, Again

The sale of a Lawrence, Central Otago, farm to forestry interests has resurrected a debate which seriously divided rural and urban sectors of the district in the early 1980s. The Clutha District Council regulatory services manager, Murray Burns, said neighbours of the property were concerned at the impact forestry will have on their farming operations and also about the loss of produtive land to forestry. Mr Burns said the 1991 Resource Management Act had introduced a planning philosophy which promoted equal treatment for all activities, and the CDC supported the view that market forces should best determine where activities should be. (Otago Daily Times)

FRI Drops Native Forests

Rotorua's Forest Research Institute is dropping work on native forests as it refocuses solely on commercially productive forestry. It has always had a small group of scientists working on native forests, but FRI chief executive, Bryce Heard, said funding for native forest and native tree research was very low and FRI's resources were being refocused on treatments for commercially-grown timber to make it competitive with other construction materials such as steel, plastic and concrete. Job losses would be kept to a minimum through retraining and transfers to other research. (Bay of Plenty Times)

Dunedin Wants Processing Plant

Large-scale wood processing near Dunedin, bringing with it the prospect of 1500 jobs, has moved a step closer with the findings of a city council working party. Its report says the city needs to clear the way for investors by buying a large processing site and by jumping the main planning hurdles. The recommendations go to the council this week. The sites identified are all in the greater Taieri area. The report says the benefits include 1500 jobs in wood manufacturing in Otago-Southland by 2010 and important flow-on economic gains. (Otago Daily Times)

No Pollen Risk From GM Pines

In a submission to the Environmental Risk Management Authority, Nelson resident, Oraina Jones, suggested pollen from genetically-modified pine trees could be a health risk and a hazard to the marine environment. However, in its evaluation of an application by Carter Colt Harvey to conduct a field trial of genetically modified pine trees near Tokoroa, ERMA said the trees would be removed before they reached maturity and produced pollen. The non-production of pollen, non-use of the trees in wood production and processing industries to create wood chips or wood dust, and the non-dietary or animal feed nature of radiata pine meant that there were likely to be negligible health effects, if any, in the event that the field trial proceeded. (Nelson Mail)

Safety Culture Needed

Forestry accidents could be completely eliminated if workers adopted a safety culture, a workshop at Telford Rural Polytechnic was told. Opening the PeopleSafe workshop, Wenita Forest Products manager, Roger Hancock, said NZ forestry safety statistics compared poorly with the rest of the world. Fletcher Challenge Forests' Jeff Weber said NZ forestry workers were 70 times more likely to get injured than those in any other industry. Although the likelihood of being injured in a year had dropped from 10% to 2%, that was still appalling when the benchmark was 0.2%. (Southland Times)