Early Bird I Wednesday September 11th 2024

Tatua’s record investment boosts local economy, economists eye $9 milk price, and Scion’s game-changing forest carbon tech heads to NASA. 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! Tatua’s record investment boosts local economy Waikato's dairy industry is set for a significant boost as Tatua Co-operative Dairy Company announces an $85 million expansion of its cream products facility. This development, located in Tatuanui, eastern Waikato, marks the largest single investment in the company's 120-year history. Tatua Chief Executive Brendhan Greaney reveals the project will double the co-operative's capacity for cream-based consumer and food service production. The expansion focuses on increasing output of products such as cream, sour cream, mascarpone, and culinary creams for both domestic and export markets. This move is expected to create approximately 40 new jobs in the region, with recruitment starting well ahead of the project's completion to ensure a trained workforce is ready when the facility comes online in August next year. The co-operative plans to shift some cream currently used in commodity exports, such as anhydrous milk fat, towards these higher-value specialist products. This strategic move responds to increasing demand that currently exceeds Tatua's supply capacity. While specific production volumes remain under wraps for commercial reasons, Greaney highlights Tatua's deliberate market diversification strategy. The expanded production will cater to various countries, including New Zealand and Australia, which Tatua considers part of its domestic market. Tatua will announce its 2024 financial year results next month. Economists eye $9 milk price Dairy farmers have reason for cautious optimism as economic forecasts point towards a robust milk price for the current season. Despite recent dips in global dairy prices, a growing number of economists are predicting the season's milk price could reach near $9 per kilogram of milk solids. Several factors are converging to create this positive outlook. Steady demand for milk products, tightening global supply, and a favorable exchange rate are all contributing to the confidence in a solid payout for dairy farmers. ANZ Bank has led the charge with a $9 forecast, with other major banks following suit. While Fonterra recently raised its forecast midpoint to $8.50, BNZ's senior economist Doug Steel isn't ruling out the possibility of hitting the $9 mark if current Global Dairy Trade prices hold steady. Westpac has revised its forecast upward to $8.70, citing three key factors: resilient world dairy prices, a more favorable exchange rate, and tightening milk supply in the Northern Hemisphere. Michael Gordon, Westpac senior economist, notes that Fonterra has already covered two-thirds of its exchange rate exposure for this season at an average rate of 61.1 cents against the US dollar, which bodes well for farmers. Adding to the positive outlook, recent animal health issues in Europe and the United States are likely to impact milk collections in those regions. A Bluetongue outbreak in northern Europe and H5 bird flu affecting cattle in growing numbers of US states are expected to constrain supply. Meanwhile, Chinese dairy farms appear to be reining in production in response to a domestic milk glut, which could potentially increase demand for New Zealand dairy exports. Rabobank's senior agricultural economist Emma Higgins points out that global milk supply growth has been weak in recent years, which has helped support dairy commodity prices. She forecasts a modest increase in production for 2025, but at a rate that should be manageable for dairy markets. However, Higgins cautions that Chinese dairy demand remains soft, with net imports expected to be 12% lower in 2024 compared to the previous year. Skim milk powder imports could see a significant drop of up to 30%. Despite these challenges, the overall outlook for New Zealand dairy farmers remains positive. Rabobank is forecasting a milk price of $8.60 per kilogram of milk solids. Farmers key in foot and mouth detection Our agricultural sector received a strong message of assurance last week as Biosecurity Minister Andrew Hoggard outlined the government's commitment to urgent eradication if foot and mouth disease ever reaches our shores. The gravity of this commitment is underscored by a recent economic impact report, which estimates that an incursion of foot and mouth disease could cost New Zealand a staggering $14.3 billion. This viral disease, which affects cloven-hoofed animals including cattle, pigs, sheep, goats, deer, and alpaca, has the potential to halt animal product exports immediately. AgResearch chief scientist Axel Heiser endorses the government's 'stamp it out' approach. He draws parallels with the Mycoplasma bovis eradication programme, while noting that foot and mouth disease moves more rapidly. The government's strategy includes considering the use of emergency vaccination if appropriate. Minister Hoggard stated that using an emergency vaccine could reduce the eradication time to 10 months, compared to 15 months without it. However, the non-vaccine approach would incur higher operating and compensation costs, potentially doubling the value of lost trade to $15 billion. The government emphasises its commitment to maintaining robust border and biosecurity measures. However, vigilance on the ground remains crucial. Farmers and veterinarians are urged to stay alert for symptoms, which can include high fever, blisters, and sores around animals' mouths and feet, as well as lameness. Scion’s game-changing forest carbon tech heads to NASA The forestry sector is making waves on the global stage, with Rotorua-based Crown Research Institute Scion set to unveil groundbreaking technology for measuring forest carbon at the upcoming ForestSAT 2024 conference. Sadeepa Jayathunga, a remote sensing and forest management spatial specialist at Scion, has developed a method to accurately measure carbon surrounding trees using laser scanners. This innovation, part of the Transforming Tree Phenotyping and Forest Insights team's work, has caught the attention of NASA and other industry experts. Funded by the Ministry of Business, Innovation and Employment, the team initially focused on radiata pine in the Kaingaroa, Timberlands, and Kinleith forests. Their success has now led to plans for expanding the technology to include native New Zealand flora, such as pōhutukawa. Michael Watt, principal scientist at Scion, highlights the "cutting-edge" nature of their work, which has enabled advancements in precision forestry. The team has successfully developed technology to pre-visually detect myrtle rust in pōhutukawa trees, a first in the field. The Forest Insights team is also harnessing the power of AI and remote sensing. Melanie Palmer, a data analyst at Scion, emphasizes the role of AI as a productivity tool, enabling the team to map forests across the entire country efficiently. This innovative work not only puts New Zealand at the forefront of forest carbon measurement technology but also demonstrates the country's commitment to combating climate change through advanced scientific research and development. Gisborne farmers unite for cancer cause Gisborne’s rural community has once again demonstrated its extraordinary generosity and resilience through the 26th annual PGG Wrightson-ANZ Daffodil Day Sheep Drive. Held at the Matawhero Saleyards on August 30, the event raised an impressive $55,000 for the Cancer Society, despite challenging times in the agricultural sector. Farmers from throughout the region donated approximately 370 sheep in the wake of a difficult year for sheep and beef farmers, who have grappled with the ongoing impact of storms and cyclones, as well as poor pricing for sheep. The event, initiated 26 years ago by former ANZ rural banker Andrew Woolfield, has seen more than 8000 sheep donated over the years, raising over $1 million for the Cancer Society.  The impact of these donations is significant for the Gisborne East Coast Cancer Society. Fundraising and events co-ordinator Shay Podjursky described the outcome as phenomenal. The funds will support a range of services including transport for treatment, free counselling, massage therapy, art therapy, cancer prevention education, and contributions to the Cancer Research Fund. See omnystudio.com/listener for privacy information.