Volume 99, No. 41

October 20 - 26, 1999

Agribusiness

NZDG in Top 25

New Zealand's largest dairy company, NZ Dairy Group, has just made it into a list of the world's top dairy companies. The Bulletin of the International Dairy Federation reports that the total expected turnover of the 25 companies is US$101 billion, $5 billion up on the previous year. The top 4 companies Nestlé, Philip Morris (Kraft), Dairy Farmers of America, and Danone retain their places, but there have been huge leaps for Land O'Lakes (USA), Parmalat (Italy), Nordmilch (Germany), and Glanbia (Ireland) through national mergers and expansion abroad. Eleven of the top 25 companies are co-operatives. (NZ Dairy Exporter)

Eastern Equities Back in the Black

Hastings-based transport and horticulture company, Eastern Equities Corp, reported an after-tax profit of $1.43 million for the year to 31 August. Although a substantial turnaround on the previous year's $667,000 loss, the profit was lower than the forecast $2.3 million. Managing director, Murray Boyte, said the continuing fall in the price of export apples had adversely affected the latest result. The company is the subject of a management buyout, and will not be paying a final dividend. Its turnover of $102.8 million was 2.4% down on the previous year. (Hawke's Bay Today)

Christchurch Wool Prices Up

Strong interest in all the wool types offered at Thursday's Christchurch auction resulted in dearer prices for most wools, despite a slight strengthening of the NZ$ against key trading currencies. The provisional indicator price for fine wools jumped 35¢ to 920¢/kg. The effect of this on the day's trading was magnified by the fact that 40% of the wool offered was Merino fleece. The provisional medium wool indicator lifted 15¢ to 405¢, but the provisional indicator for strong wools slipped 1¢ to 369¢. Only 1274 clean tonnes (10,963 bales) were offered, and 12% was passed in. (Otago Daily Times)

New Protection Law 'Good News'

The passing of the Personal Property Securities Act last week was good news for all farmers and growers, said Federated Farmers president, Alistair Polson. It would alter the face of the processing industry and commercial practices across the country. The Act enabled farmers, growers and other suppliers to avoid the type of large financial loss associated with the collapse of the Weddel and Fortex meat companies. Under the Act, suppliers could register a purchase money security interest (PMSI) over supplied material, such as livestock or grain, until it was paid for, he said. Farmers and growers who registered a PMSI would have a claim over the assets of failed processors, ahead of financial institutions' claims. (Straight Furrow)

BoP Fertiliser Sales Up, Profit Down

Despite record sales of 1,172,800 tonnes for 1998-99, BoP Fertiliser Group revenue declined from $308.1 million to $301.4 million, and profit eased to $26.4 million - down $2.6 million on 1998. The annual report says lower prices and imported cost increases reduced margins on most products. The fertiliser co-op increased its ownership from 60% to 80% in a new partnership with the world's largest fertiliser producer, Norsk Hydro, which replaced a previous joint venture with Fernz Corp. The chairman, Peter Jensen, said sales qualifying for rebate reached a

new high of 923,000 tonnes, up 6.5% on the previous year, reflecting strong support from shareholders. (NZ Dairy Exporter)

Nobilo Targets $3.5 million Profit

Nobilo Wines is determined to achieve a $3.5 million profit in the next year, the chairman, David Irving, said. Nobilo exceeded its initial bottom-line target by almost 9% with an after-tax profit of $1.73 million for the past year. The company had well-established outlets in Britain, the US, Australia and Japan. In New Zealand, distribution opportunities had widened as a result of more liberal liquor sales laws coming into effect soon. The company was also adding an Australian beer to its portfolio through National Liquor Distributors. It is also spending $20 million on a new international-standard bottling and packaging plant at Huapai, Auckland. (The Dominion)

Ag Journalism Awards

NZ Dairy Exporter journalist, John Waugh, won the national AgResearch Agricultural Science Writing Award for 1999. He was presented with the award at a New Zealand Guild of Agricultural Journalists and Communicators function in Wellington. Other Guild awards for farming features included:- Bank of New Zealand Rongo Award to Catherine Harris, Radio New Zealand; BNZ Sharemilker Media Award to Erica Rawlings of Dairying Today, and the WoolPro Sheep Technology Award to Countrywide. (NZ Dairy Exporter)

New Manager For Dairy Brands

Management group, Agricultural Resources Ltd, was approved as manager of corporate farmer, Dairy Brands, at a special meeting in Christchurch, although small shareholders pushed for answers to their questions. The vote was eventually carried by 12.7 million to 854,400. Agricultural Resources is a joint venture between Farmers Mutual and Agricultural Investments Ltd, a North Island dairy management group of about the same size as Dairy Brands. (Christchurch Press)

Huge Meat Plant in Saudi Arabia

A New Zealand design company, ProAnd Associates, has designed a huge meat plant that is under construction near the Saudi Arabian city of Makkah. The site covers 80ha and the building area is 300,000m². The processing capacity is 10 times that of the biggest plant in New Zealand, with the ability to process 200,000 sheep in 14 hours and a total of 400,000 in 3 days. It will operate for only 3 days/year, catering for Muslims during the Haj festival. ProAnd director, Michael Nidd, said that if the plant was in New Zealand, operating 5 days/week, it could process the entire NZ lamb kill in 25-26 weeks. (NZ Farmer)

Frucor Takes on Pepsi

Frucor Beverages, previously owned by the Apple and Pear Marketing Board, has taken up the NZ franchise for Pepsi carbonated drinks. Frucor currently produces such icon NZ juice brands as Fresh Up and Just Juice, as well as McKoy fruit juice and NZ Natural mineral water. Frucor was sold by the APMB last year for $50 million to a consortium of international bankers, with Boston-based Bain Capital the major shareholder. (NZ Herald)

Buy NZ Campaign Resurfaces

The Buy New Zealand Made campaign has resurfaced, with a new chief, Dalton Kelly, at its head. Buy NZ Made is funded solely by its 1000 company members, and membership is growing by about 20 companies/month. Mr Dalton said that if every New Zealander spent $2/week more on NZ-made products, it would create 1154 more jobs. (The Dominion)

Burns, Philp Progressing

Australian food ingredients group, Burns Philp and Co, said 1st-quarter earnings rose 37% to A$14.2 million, despite sales falling 15% to A$309.3 million, as it held trading profits steady and interest costs fell. The chairman, Alan McGregor, said the last 2 years' restructuring had allowed the company to trade profitably and the business was sound. The group nearly collapsed in 1997 after it slashed the value of its North American herbs and spices business. (Christchurch Press)

Goodman's Plans For Ernest Adams

Trans-Tasman food giant, Goodman Fielder, has completed its takeover of NZ baker, Ernest Adams. It achieved 97% acceptance of its offer before moving to compulsory acquisition. Executives from the 2 companies have formed a steering committee to develop an integration plan. GF also said it planned to delist Ernest Adams. (Evening Post)

Heinz Expanding, Again

H J Heinz, which recently expanded its US food trading through an acquisition and restructuring, has expanded its holdings in Britain with a US$317 million deal to buy British-based United Biscuits' frozen and chilled foods division. (The Dominion)

Trade

GM Labelling Draft Agreed

A trans-Tasman meeting of Australian Federal and state Ministers of Health, and the NZ Minister, Wyatt Creech, has agreed on a draft labelling standard for genetically engineered food. It will be released for public comment. The Australia New Zealand Food Standards Council, meeting in Canberra, reaffirmed the decision of its August meeting that the 2 countries should adopt mandatory labelling of genetically modified foods. Mr Creech said the draft standard included food testing and a due diligence requirement for food manufacturers to determine whether there was GM material in a product. Further work was needed to establish that the draft standard would not impose unreasonable compliance costs, he said. (Christchurch Press)

Meat Industry the Next Target?

After the US Justice Department announced it would sue the tobacco industry to recover medical costs, the US-based Physicians Committee for Responsible Medicine has urged a similar case be prepared against major meat producers and retailers. The president of PCRM, Dr Neal Barnard, said meat consumption was just as dangerous to public health as tobacco, and the "devastating effect of meat consumption" was being ignored. A PCRM study showed meat consumption to be directly responsible for US$61 billion in annual US medical costs. The study looked at only 7 health problems linked to meat consumption, including heart disease, cancer and diabetes, and concluded that 1.3 million Americans died of meat-related causes each year. It was time to look at holding meat producers and fast-food outlets legally accountable, he said. (Tobacco Times)

Hands Off Our Quota

The NZ meat industry is telling South American producers that the unused portion of New Zealand's US beef quota is not up for renegotiation. NZ beef exports to the US have fallen by about 12% this year, reflecting lower cattle numbers here and a recovery in Asian beef markets. There is still 35,000 tonnes left of the 213,000-tonne quota. Argentina and Uruguay, who have tripled and doubled their exports to the US, are pushing to have their quotas increased, and there has been pressure on New Zealand to release its unused quota. NZ Meat Industry Assn executive director, Brian Lynch, said this country's access to the US beef market was not up for renegotiation before the next Round of world trade negotiations. New Zealand's beef access to the US was part of a package of benefits and concessions which emerged from the Uruguay Round of trade talks and it was not acceptable to extract one element and try to revise it. (RNZ Rural Report)

NZ Lamb Not Welcome

NZ lamb was stripped from some supermarkets in Ireland after militant Irish farmers dumped NZ meat in the street outside one food chain. NZ meat was forcibly removed from some stores in Cork and Dun Laoghaire, south of Dublin, in a demonstration by the Irish Farmers Assn. The farmers have threatened to spread the campaign to other markets for NZ lamb. Sheep committee chairman, Frank Corcoran, alleged NZ lamb was being produced without the strict rules on traceability, food safety and regulations applied to European producers. Meat NZ's general manager of trade policy, Gerard Thompson, said the protest was not significant as Ireland took only 20 tonnes of NZ lamb. The protest was without justification, and was caused more by depressed prices for meat than any impact New Zealand might have. (Evening Post)

Trade Round At Risk?

Global talks planned for next year could collapse if demands by developing countries for freer trade with the US and other industrialised economies are ignored. With only weeks left before Trade Ministers meet in Seattle aiming to start the next round of talks, the World Trade Organisation's 134 member governments are divided over the terms of a declaration that will guide the negotiations. Developing countries, which account for more than 75% of WTO membership, are holding out for guarantees on freer trade in textiles, a reduction in farm subsidies, and curbs on the use of measures to restrict imports found to be sold below cost. Some countries, such as Indonesia and Malaysia, are questioning whether a new round of talks should begin at all. (NZ Herald)

6000 Dairy Farmers Could Go

More than 6000 of Australia's 13,500 dairy farmers could quit the dairy industry if deregulation is approved by all 6 states later this year, hitting rural economies and collapsing dairy farming incomes. This is despite the Federal Government's plans to provide a virtual subsidy to both existing and exiting farmers through a A$1.8 billion assistance package, partly derived from an A11¢/litre levy on all retail milk sales. It has been estimated that about 10% of Victorian dairy farmers and at least 33% of those in New South Wales and Queensland would leave the industry. The Federal Minister of Agriculture, Warren Truss, has given the states a deadline of early November to decide on the issue. (NZ Dairy Exporter)

Shippers Face Higher Fuel Bills

Rising international oil prices have led to shipping lines putting a bunker fuel surcharge on customers. In the case of Columbus Line, the rise would lead to additional costs of US$50-US$70/container, the general manager, Greg Wilson, said. Maersk NZ's national marketing manager, Craig Sain, said the company was likely to introduce a

surcharge on trades moving north and south between New Zealand, Asia, the Middle East and the Indian subcontinent. P&O Nedlloyd was still considering the matter, the company said. (NZ Herald)

Lamb Charges Will Cost Australia

Australian lamb producers will lose between NZ$44.8 million and NZ$51.2 million because of US restraints on lamb imports, the Australian Bureau of Agricultural and Resource Economics said. Lower saleyard prices and lower production because of reduced shipments to the US, would contribute to the fall in production value. The US is Australia's largest export lamb market, taking just under 21,000 tonnes, valued at some A$130 million/year. Australia's export market to the US would continue to expand, but more slowly than it had been recently. (Christchurch Press)

Freight Co Comes to NZ

New Zealand has become the 51st international outpost for logistics and freigth forwarding giant, Danzas Group of Switzerland. The chief financial officer, Jim Fredholm, said New Zealand was a fairly insignificant portion of the 184-year-old company's annual sales figures a turnover of $9.5 billion, but it provided a springboard to the smaller islands of the South Pacific. (NZ Herald)

Livestock

AHB Wants Bigger Govt Input

The Animal Health Board wants more input from the Government an extra $5 million worth for next year's campaign against bovine Tb in deer and cattle herds. In the year to June, the control of vector animals, mainly possums and ferrets, cost a record $27.7 million, $3 million more than the previous year, and it funded pest control on a record 2.9 million ha. Next year, the Board wants to lift pest control by $8.45 million - $4.95 million from Government, $1.59 million from industry, and $1.91 million from regional councils. Board chairman, Don Linklater, said the money from industry was already available, and regional councils were preparing to contribute their share, so the key to the big push would be the Government's funding. The Board believes that if the pressure can be maintained on possums, the herd infection rate could be reduced to around 0.2%, an international benchmark for 'Tb-free' status, by 2010. (NZ Herald)

Homekill Still Allowed

The new Animal Products Act 1999, much of which comes into force on 1 November, continues to allow people to slaughter and consume their own meat. Specifically, farmers and other animal owners actively engaged in the day-to-day maintenance of animals, will be able to slaughter their own animals or have this done for them by service providers. Either way, the homekill products must be used or consumed by the farmers, or animal owners, their families, members of their household, or on-farm employees it cannot be commercially traded. Hunters can have the game they shoot processed by a recreational catch service provider, as long as it is for the hunter's own consumption, their families, households, or other members of the hunting party. Homekill and recreational catch service providers have until 30 April 2000 to be listed with MAF. (Meat Matters)

Beef Cattle Numbers Increasing Again

NZ beef cattle numbers are increasing again after 2 years of drought severely reduced the size of the national herd. The Meat and Wool Economic Service is predicting a 4% increase in cattle numbers in the next year. (RNZ Rural Report)

Rare Pigs Isolated

Rare Auckland Island pigs will remain in quarantine in Invercargill until the Ministry of Agriculture and the Rare Breeds Conservation Society finalise a plan that will allow them to be released under risk management. Last January, the society moved 17 pigs from the Auckland Islands to mainland NZ under a disease-risk management regime developed by MAF. The pigs were taken from the islands to preserve the breed, and to allow the Department of Conservation to restore the islands to their original natural state. (Straight Furrow)

Dual Meat Operators Recognised

The new Animal Products Act 1999 officially recognises retail butchers dealing in regulated animal products, but also handling homekill product a bone of contention in the past. Under the new Act, there must be adequate separation between the operations. 'Dual operator' butchers will be required to establish risk management programmes for their regulated product operations. Such systems must be in place by 31 October 2002, but earlier compliance is being strongly encouraged. (Meat Matters)

Tougher Rules for Antibiotic Use

Antibiotic use in animals is to be more closely regulated in the light of fears that abuse is creating new drug-resistant superbugs in humans. The Animal Remedies Board adopted new policy recommendations midweek on

the use of antibiotics in animal feeds. The Board has proposed a committee including the Ministry of Agriculture and the Ministry of Health to give an overview on the link between antibiotic use in animals and antibiotic-resistant bacteria in humans. It also proposed new criteria for assessing applications to register antibiotics for use in animal feed. The Board said it supported the development of standards, guidelines and codes of practice by veterinarians and the agriculture industry. The Board believes that some products already on the market will not meet the new criteria. (The Dominion)

PPCS, Scientist Join Forces

Dunedin-based meat company, PPCS, has teamed up with world-renowned biotechnology scientist, Professor Diana Hill, in a venture aimed at significantly boosting returns to sheep farmers. Their new company, Global Technologies (NZ) Ltd, will also provide an important and long-awaited link between Dunedin's research scientists and the business sector. Its aim is to develop new, high-value products from sheep, PPCS chief executive, Stewart Barnett, said. Professor Hill, regarded as a world leader in sheep genetics, is leaving Otago University to work full time with PPCS. (Otago Daily Times)

Good Spring For Lambing in the South

Southern farmers appear to have achieved a good lambing result this year. The result has been helped by another favourable winter and spring and an abundance of pasture growth in many parts of the region. Indications from West Otago and Eastern Southland were for a lambing percentage of around 125%, down a fraction on last year's record 127%. Southern dairy farmers are also reporting an excellent spring season, with good grass growth, good cow condition, increased milk production, and cows mating well. (Southland Times)

Horticulture

Support Network For Growers

A support network has been set up for the country's fruit growers, with some apple producers facing the prospect of a 75% drop in income because of falling overseas prices. The NZ Fruit Growers Federation has enlisted the help of existing rural support networks throughout the country to help growers. The federation is lobbying the Government to extend the criteria for rural assistance grants to include orchardists. Federation chief executive, Peter Silcock, said that if it could be proven that orchardists were suffering because of a drought, they would immediately qualify. (Otago Daily Times)

Growers Want More Information

Pipfruit growers are demanding more information about Enza's joint venture with Geest World Wide Fruit (AgBrief 99-40) and how it will lift marketing performance in Britain. Independent Pipfruit Growers Assn president, Danny Freilich, said Enza had to get its marketing right in the crucial British market, and he wanted to see the fine print of the joint venture. (The Independent)

NZ Wines Take Top Awards

Villa Maria Estate has been named NZ wine company of the year for the 2nd consecutive year at the Australasian Winestate Awards. NZ winemaker of the year was Villa Maria's chief winemaker, Michelle Richardson. Winestate magazine's judging panel sampled more than 10,000 wines, the largest blind tasting of Australasian wines in a competition. NZ wines dominated key categories, Winestate publisher, Peter Simic, said. It confirmed New Zealand's status as a producer of quality Sauvignon, Chardonnay and Merlot wines, and the New Zealanders gave the Australian wine makers a 'run for their money' in the Pinot noir category. (Evening Post)

Nobilo Expanding Sauvignon

The chairman of Nobilo Wines, David Irving, said the company was convinced that world markets would continue to demand Sauvignon blanc wines for the foreseeable future. The company had recently bought 100ha of land at Rarangi in the Wairau Valley, Blenheim, to boost the company's grape supply. The land cost $1.3 million and would be developed over 3 years at a cost of $1 million/year. At full production it should yield $6.5 million annually in export revenue. (Christchurch Press)

Drive to Beat Export Damage

An extensive research project is under way to find out exactly how apples get damaged while being freighted in cartons across the world. The work is being carried out for Enza by Hamilton-based Postharvest Group, a branch of Lincoln Ventures, the commercial trading arm of Lincoln University. Postharvest has developed force sensors - monitoring devices - that can be put into cartons of apples to measure the forces that impact on them. The information they provide could save hundreds of thousands of dollars and also get round the need for potentially costly packaging experimentation. (Hawke's Bay Today)

South Africans Impressed

South Africa's horticultural research groups are looking to start joint ventures with NZ researchers. Three

members of Hortec, part of the Deciduous Fruit Producers Trust in South Africa, have been visiting HortResearch centres. Hortec director, Robin Storey, said the organisation was looking at commercialising its operations and he was very impressed with HortResearch's commercial approach to research. The group had visited HortResearch centres at Mt Albert, Hawke's Bay, and Palmerston North. (Manawatu Evening Standard)

Frost Blaster Under Development

Two Wairarapa men, an engineer and a grape grower, have patented a turbocharged air blowing system which uses conventional irrigation piping and drippers to conduct warm air throughout a vineyard to create a mini-climate among grape vines and to blow frost away. The machine is still under development, but protective patents have been taken out in New Zealand and overseas. (Farm Equipment News)

Korean Growers Struggling

Korean vegetable growers in New Zealand have set up their own association to represent their interests nationally amid fears that many of them could be squeezed out of the local market. The president of the Korean Vegetable Growers Assn, Kook-Nam Yom, said about 80 Korean immigrants had set up commercial vegetable-growing businesses in South Auckland in the past 5 years, investing between $400,000 and $1 million in property, glasshouses and packing operations. However, many of them were now struggling, he said, as more established growers increased production and merged to gain greater efficiency and presence in the domestic market. (NZ Herald)

Big Flower Sales to US

NZ flower exporters have high expectations for the US market in the run-up to the new millennium. Stephen Arnet, export manager of Auckland-based Flying Fresh International, said the company was anticipating strong export volumes throughout the remainder of 1999. Demand spikes were expected for Thanksgiving (23 November), during the US election campaign, and the millennium celebrations. The Thanksgiving market would be particularly strong, with an emphasis from US buyers on 'autumn tonings'. The US is New Zealand's 2nd-largest export market after Japan. (Export News)

Avocado Sales Set to Soar

NZ avocado exports to the US are predicted to grow by as much as 625% in the 1999-2000 season. The Avocado Industry Council estimates this season's sales to the US will total 450,000-500,000 trays, up from around 80,000 in 1998-99. Driven by the high US demand, total export volumes for the season are predicted to reach 1.1 million trays, 20% up on last year's record crop of 838,000 trays. AIC export chairman, John Carroll, said growth in the US market, coupled with very strong prices, could produce a 'one-in-ten-year' return for growers. So long as New Zealand delivered good product, the season would be somewhere between "very good" and "terrific", he said. (Export News)

Land, Soil, Water, Arable

A Summer Scorcher

This summer could be a scorcher, with 2 unusual events pushing up temperatures throughout New Zealand, MetService said. Forecaster, Eric Brenstrum, said La Nina was expected to sweep New Zealand for the 2nd year running this summer. It was the first time in 20 years that the La Nina pattern had happened on 2 consecutive years and might indicate a cyclical change in global weather. The National Institute of Water and Atmospheric Research is reporting higher-than-average water temperatures in the Tasman Sea, but no-one is sure quite what has caused the phenomenon. (The Dominion)

Farmers See Drought Ahead

Average temperatures on the west coast of the North Island are expected to rise by up to 1^oC, and there could be less rain than normal, MetService says. In Marlborough, half the usual rainfall has fallen this month, and many farmers have started selling lambs and cattle in anticipation of a drought. MetService forecaster, Eric Brenstrum, said the north-east of the North Island, from Northland, through Auckland, Coromandel, Gisborne and Hawke's Bay could expect higher average temperatures and more rain. Taranaki to Wellington and most of the South Island could expect higher temperatures and less rain than normal. Temperatures could be from 0.5^oC to 2^oC above average in some parts of the country. Federated Farmers vice-chairman, Graham Hewitt, said that in Marlborough, South Canterbury, and North and Central Otago, farmers were getting 'twitchy' about the weather, and some were looking at the prospect of a 3rd year of drought. (The Dominion)

Lack of Confidence in Market

Farm sales in August reflected a growing lack of confidence in the rural sector, said Real Estate Institute of NZ spokesman, Murray Cleland. The Reserve Bank's warning of higher interest rates, the upcoming General Election, and the conflict surrounding the activities and future of the Wool Board and Dairy Board were having

an effect. While the number of farms sold in August was higher than in the previous 2 years, the median price paid was lower than in the same month in the previous 2 years. The number of farms sold was 168 (153 and 113 in August 1998 and 1997), and the median price was $306,394 ($310,000 and $322,500 in August 1998 and 1999). (NZ Dairy Exporter)

New Grain News Format

United Wheatgrowers Ltd is shortly to produce a new format for the way it presents New Zealand and international pricing information on grains. United chairman, Syd Worsfold, said the new format would be presented in provincial newspapers, with a market commentary, and pricing information on barley and maize, as well as wheat, so that growers would be able to make planting and marketing decisions based on better market knowledge. The company is also investigating better ways of gathering and presenting accurate information on the size and quality of the NZ wheat crop. (Straight Furrow)

High-yield Wheats Released

The release of 2 new wheats with exciting production and quality potential has been announced by Crop and Food Research. One cultivar is to be marketed in New Zealand, the other in Australia. A high-quality autumn bread wheat, 4134.19, is especially suited for Canterbury conditions. The other cultivar, a durum or pasta wheat named Arrivato, is being released in Australia, where it was developed jointly with local breeders. It is intended for the premium Italian pasta market. (Christchurch Press)

Lower Wheat Levy

United Wheatgrowers Ltd is confident that the levy for the 2000 harvest will be substantially lower than the $2.50/tonne of the past 2 years. The levy is collected by United Wheatgrowers on all NZ-grown wheat sold and is used to pay for a disaster insurance scheme. UWL chairman, Syd Worsfold, said it was the sole use of the levies collected, and it had worked well for the benefit of growers. The cost was much lower than individual growers could achieve. (Straight Furrow)

Industry

Wool Growers Back Review

Overwhelming wool grower support for an independent assessment of the Wool Board has been confirmed. At the Board's AGM in Rotorua this week, growers expressed dissatisfaction with the Board's performance, and lack of accountability with growers' funds. Votes of no-confidence were tabled. Growers were sceptical about the independence of international management consultancy, McKinsey and Co, which had been appointed to review the Board's performance. After a presentation by the company's NZ principal, Andrew Grant, the tone of the meeting changed. A remit seeking to veto McKinsey was withdrawn. A resolution that an independent assessment be done in the interests of the economy and of growers was passed by 23,033 votes to 702. (Christchurch Press)

NZDG Chairman Resigns

Citing personal reasons, the chairman of NZ Dairy Group, Doug Leeder, resigned mid-week after only 12 months in the job. However, in later reports, Mr Leeder said he resigned after a former NZDG staff member threatened to reveal their recently-ended relationship if he did not give up the chairmanship. There was also much speculation that Mr Leeder did not have the support of the majority of his fellow directors in his personal approach to the proposed mega merger of the dairy industry. (NZ Herald/The Dominion)

Van Der Heyden Steps Up

The board of NZ Dairy Group has elected Henry Van Der Heyden as its new chairman in the wake of the previous chairman's sudden resignation mid-week. Mr Van Der Heyden said NZDG would press ahead with negotiations for a dairy industry mega merger, and expected to strike a deal with Kiwi Co-op Dairies by late next month. Mr Van Der Heyden, 42, has been a director of NZDG since 1992, deputy chairman from last year, and a director of the NZ Dairy Board since 1997. (Evening Post)

Meat and Wool = Meat and Fibre

The Meat and Wool Section of Federated Farmers has changed its name to NZ Meat and Fibre Producers, but will continue as an industry group within the federation. The chairman, Chris Lester, said the section's old name was internally focused and more about the role of the section within the federation. The new title stated much more clearly who the industry group represented and what the sheep and beef farming members contributed to the agriculture industry. (Christchurch Press)

Act Dies If No Merger

If the mega merger of dairy companies proceeds, the Dairy Industry Restructuring Act comes into effect. If the mega merger does not proceed, the Act dies and the industry is back to its traditional status, without an answer

to any of the problems it is facing, the Minister for Food and Fibre, John Luxton, told the Dairy Board's annual meeting. The industry would then need to develop another plan and go back to the Government, hoping it would provide the legislation needed. (NZ Dairy Exporter)

Wool Stolen to Order

Wool thieves targeting farms and woolstores may be stealing to order. Taumarunui wool warehouse, Elco Direct, has stepped up security after losing about $30,000 worth of stock this year. Branch manager, Max Downey, said the thieves had also stolen the company's trucks to haul the wool bales away. Thieves were also stealing wool from farms, were stealing more frequently, and were taking top-quality wool, he said. (NZ Herald)

1 Million-litre Train Load

Kiwi Co-op Dairies and Tranz Rail have successfully trialled a 1 million-litre train load of milk in 20 tankers hauled by 3 locomotives. The huge train made the journey from the company's Longburn site at Palmerston North to its processing plant at Hawera early this month. It was the biggest load that Kiwi or any dairy company in New Zealand has transported by rail. Kiwi's general manager of supply services, Garry Webber, said the trial was aimed at improving the scheduled arrival of milk into the Hawera site. The milk train offered the company the advantage of scheduling milk arrivals soon after the road tankers left for mid-morning pick-ups. Each tanker-wagon holds 50,000 litres, against 25,000 litres for a road tanker. (NZ Dairy Exporter)

Funding For FarmSafe

Federated Farmers has been granted funding from the OSH WorkSafe Fund to establish FarmSafe New Zealand. FarmSafe NZ will implement a project aimed at reducing injury and death on farms from accidents on tractors and ATVs. The federation's application was one of 14 selected from 96 organisations. Federation occupational safety spokesman, Roger Barton, said farmers underestimated the true cost of on-farm accidents, and if they took the time to calculate the real costs, they might take a more safety-conscious approach. (Straight Furrow)

Export Meat Production

In the first week of the new season, to 11 October, the number of lambs slaughtered for export was 201,404, up 11% compared with the same period last year; hogget production was down 48.4% at 373; mutton was down 11.7% at 26,523. The number of steers slaughtered for export was down 11.1% at 4470; heifers slaughtered were up 8.5% at 1415; cows slaughtered were down 3.1% at 6938 and bulls were up 41% at 2922. Total beef slaughterings for export were up 1.1% at 15,745. Bobby veal production was down 26.7% at 45,628, and goat slaughterings were up 35.4% at 1155. (Meat Matters)

Tui Merger Sequel in Court

A statement of claim has been served on Kiwi Co-op Dairies, its chief executive, Craig Norgate, and chairman, John Young, as well as a number of other defendants, in a High Court action over the merger 3 years ago of Kiwi with Tui Milk Products, Palmerston North. The action has been initiated by some 280 former Tui shareholders from Manawatu and Wairarapa. (NZ Dairy Exporter)

Forestry

FCP Put at $1.79/share

The exchange ratio for the merger of Fletcher Challenge Canada and Fletcher Challenge Paper values the Fletcher Paper shares at $1.79, 5¢ down on the original proposal of $1.84. FCP said the exchange ratio under the arrangement agreement between it and FCC was 0.0957. The exchange ratio was the fraction of a Class A common share of Fletcher Canada that would be issued for each FCP share. At that ratio, the implied value of each FCP share would be $1.79, based on the 21 October closing price for FCC of C$14.30 and the exchange rate between the Canadian and NZ dollars. The arrangement agreement between the companies is still subject to approval by shareholders (who will decide on 1 and 2 November) and the courts. (The Dominion)

Growth Targets For Forestry

The Ministry of Agriculture and Forestry forecasts that in the next 25 years, New Zealand's annual available sustainably farmed wood harvest will exceed 50 million m³, putting this country on a par with Sweden, Finland and British Columbia. Based on this, the NZ Forest Industries Council estimates that the forestry industry will produce more than $18 billion in outputs, compared with $5 billion now; this will be more than 14% of GDP, as against 4% now. There will be 60,000 people employed in the industry (250,000 indirectly), against today's 25,000 (100,000 indirectly). Export earnings will be greater than $14 billion, against $2.4 billion now, and it will be the country's biggest exporter, compared with 3rd-largest now. (Export News)

Wood Plant Plans Welcomed

The Clutha District Council has welcomed a Dunedin City Council report on how a large-scale wood processor could be attracted to the city (AgBrief 99-40). CDC chief executive, Michael Ross said the huge forest resource in Otago needed to be utilised, and the district council had itself invested money and effort to attract a processing plant. The 2 councils were not in competition, and the whole region would benefit from such a plant. The CDC

district plan was already operative and structured in a way that reduced the hurdles for the establishment of wood processors, he said. Three forestry investors from the US would be visiting Clutha before Christmas, he added. (Otago Daily Times)

Log Prices Boost Confidence

An increase in log prices is breathing new confidence into the forestry sector, according to Perpetual Trust managing director, Stephen Eaton. Because the firming looks set to continue, forestry companies moving into the harvest stage were taking out shorter contracts so that new terms could be negotiated in the near future. Perpetual Trust manages the Nuhaka Farm Forestry Fund plantation near Gisborne, where harvesting has begun after 25 years. Mr Eaton said the first proceeds from log sales would be applied to Nuhaka's $1.5 million debt, and by next year payments should be going to unit-holders. (National Business Review)

Support For Forestry Initiatives

The Dunedin City Council's efforts to attract large-scale wood processing to the Dunedin area have been mainly favourably greeted by community and business representatives. Otago Chamber of Commerce chief executive, John Christie, said it supported the council's initiative, but not at any cost and not at the cost of the environment. Similar views were expressed by the chairmen of the Mosgiel Taieri Community Board and the Dunedin Ratepayers and Householders Assn. However, some community reps did not want a plant to be located on valuable farmland or ratepayers' money being involved. (Otago Daily Times)