Early Bird I Friday August 30th 2024

Weak global milk production boosts farmgate prices, wild animals costing farmers hundreds of millions of dollars a year, and new programme weaves wool into tertiary education. Welcome to Proud Country's Early Bird - The top things you need to know that impact rural New Zealand delivered to you by 5am, because who doesn’t need better chat beyond the weather! Weak global milk production boosts farmgate prices Rabobank has increased its milk price forecast for the 2024/25 New Zealand dairy season to $8.60 kg/MS, reflecting weak global milk supply and steady-to-higher dairy commodity prices. The bank's Q3 Global Dairy Quarterly report, "Market Narratives are Shifting," highlights the continued trend of limited milk production growth from major export regions. Since late 2021, the Big-7 dairy export regions - including the EU, US, New Zealand, Australia, Brazil, Argentina, and Uruguay - have shown growth in only three quarters. For 2024, production growth is expected to remain modest at 0.14 percent year-on-year. This constrained supply has contributed to improved milk cheques for many dairy producers. On the demand side, market conditions remain mixed. Retail deflation continues in South America, the United States, and most of the EU, although prices remain elevated compared to pre-Covid levels. China's dairy demand remains a concern, with consumption estimates revised downward for 2024. Chinese net imports are projected to decrease by 12 percent year-on-year, with skim milk powder imports potentially dropping by up to 30 percent compared to 2023. Despite China's reduced demand, global dairy trade through May was largely positive. Increased trade to Algeria and Southeast Asia helped offset declines in skim milk powder exports to China and Mexico. The report indicates that global supply and demand are now broadly balanced, with markets likely to remain stable in the near term as exporting regions gradually increase production. However, factors such as the ongoing rebalancing of the Chinese market and the upcoming U.S. election could potentially alter trade dynamics. In New Zealand, export volumes for the three months to June 2024 were 11 percent lower than the previous year, reflecting weaker milk production and reduced shipments to key markets. The 2023/24 season ended with production down by just over one percent on a tonnage basis. However, the outlook for the 2024/25 season appears more positive, particularly in the North Island, where favourable autumn conditions and a mild winter have set the stage for a good start. Wild animals costing farmers hundreds of millions of dollars a year Rural communities across the country are grappling with a growing threat to their livelihoods and the environment. Unchecked wild animal numbers are causing millions in damages and undermining conservation efforts. A recent survey involving over 700 Federated Farmers members reveals the hard-hitting economic impact. Feral animals are costing our nation's farmers at least $213 million annually. This includes $74 million in direct control measures and a staggering $139 million in lost production. Richard McIntyre, Federated Farmers' voice on this issue, says that many farming families, already dealing with tight margins, now face this additional economic burden. The damage goes beyond immediate financial losses. It extends to ruined land, damaged infrastructure, and a concerning decline in native plant life. Goats, wild hogs, and deer are the main culprits, with their numbers increasing dramatically, especially near Conservation land. Many farmers view the Department of Conservation as an unwelcome neighbour due to its limited action on controlling these animal numbers. While farmers invest heavily in control measures, the lack of matching efforts on public land undermines their work. Government data shows a 64% increase in deer and goat numbers on conservation land over the past decade. This surge continues despite current control efforts. The issue isn't confined to farmland. With a quarter of New Zealand's native wildlife found on farms, unchecked animal numbers threaten our unique ecosystems. McIntyre warns that without increased action, we risk further biodiversity loss and reduced agricultural output. The survey also revealed that nearly half of the farmers reported growing wild animal numbers over the last five years. Many find their current control methods inadequate against the rising tide. Bremworth bounces back with new focus New Zealand wool carpet manufacturer Bremworth is bouncing back after a challenging year, bringing welcome news to wool growers nationwide. The company has navigated through Cyclone Gabrielle's aftermath and a major shift towards all-wool products, emerging with a clear vision for growth. Despite hurdles, Bremworth achieved a $4.6 million profit for the year ending June. While this figure is lower than the previous year, it marks a turning point in the company's recovery. The manufacturer aims to resume dividend payments by 2026, a move that could boost confidence among farming investors. Revenue dipped to $80.3 million, largely due to inventory challenges following the cyclone's impact on Bremworth's Napier yarn plant. However, the company's wool-buying arm, Elco Direct, increased its market share at the farm gate. This growth occurred even as national wool volumes declined, highlighting the enduring demand for quality New Zealand wool. The company has bolstered its stock levels, particularly focusing on top-selling lines. This initiative aims to reduce customer wait times from months to mere days, a change that could significantly enhance Bremworth's market position. Bremworth is also eyeing expansion into new markets, particularly targeting multi-level residential apartments in Australia. The company has launched a dedicated commercial team to grow this segment of the business. New programme weaves wool into tertiary education Meanwhile a new tertiary education programme called Wool Dynamics is bringing the benefits of wool to six major architecture and product design schools across New Zealand. Developed by Campaign for Wool New Zealand (CFWNZ) and authored by Professor Frances Joseph and Peter Heslop from Auckland University of Technology (AUT), the programme is being trialled at Victoria University, AUT, Ara Institute of Canterbury, Otago Polytechnic, University of Waikato and Massey University. Wool Dynamics focuses on the use of wool in building and product materials, integrating learning modules into existing architecture and product design courses through research and case study content. The programme aims to encourage architects to specify more wool in buildings and inspire product designers to create innovative wool-based products. Professor Joseph sees numerous opportunities for wool in interior design and construction, highlighting its insulating qualities and potential to replace imported products. She envisions New Zealand not only producing but also manufacturing and using products made from the world's best wool. Wool Dynamics showcases wool's diverse properties, including moisture-wicking, insulation, and temperature regulation. Students will learn to consider wool for various applications, from sound absorption in architecture to filtration in product design. The programme also explores wool's potential in occupational therapy, healthcare settings, and pet products. The pilot programme is scheduled to run throughout 2024. Following evaluation and refinement, CFWNZ plans to roll out Wool Dynamics to tertiary education providers nationwide in 2025. This initiative represents a significant step towards revitalising the wool sector and fostering innovation among the next generation of designers and architects. Invercargill secures Young Farmer of the Year showdown Invercargill is set to become the epicentre of New Zealand's agricultural talent as it secures hosting rights for next year's FMG Young Farmer of the Year Grand Final. The prestigious event, entering its 57th year, will kick off with District Contest competitions in October, seeing up to 200 young farmers compete for a shot at rural stardom. After proving themselves at the district level, they'll face off against the best in their region. The competition is fierce, with only seven national finalists selected from across the country to compete in the Grand Final from July 3rd to 5th next year.. The Grand Final isn't just about individual achievement. Fourteen FMG Junior Young Farmers of the Year teams will also compete for a national title, alongside 21 AgriKidsNZ teams from across Aotearoa, making it a comprehensive showcase of New Zealand's agricultural future. For those eager to participate, entries for FMG Young Farmer of the Year open on Monday, September 2nd, 2024. Aspiring Junior Young Farmers and AgriKids can submit their entries from Monday, October 21st, 2024, through the New Zealand Young Farmers' website. See omnystudio.com/listener for privacy information.