Milking longer with maize silage
This season's dry conditions have made one thing clear: not having enough feed on hand can bring your season to an early close.
Fonterra chairman John Wilson says there is further downside risk to its 2014-15 forecast payout.
He made the comments as the co-op slashed its payout by 70c/kgMS; Fonterra reduced its forecast farmgate milk price for the 2014-15 season from $6.00 to $5.30/kgMS, and increased and widened the estimated dividend range from 20-25 cents per share to 25-35 cents – amounting to a forecast cash payout of $5.55-$5.65/kgMS for the current season.
Wilson says the lower forecast farmgate milk price reflected continuing volatility, with the GlobalDairyTrade price index declining 6% in the past two trading events.
"The market is currently influenced by strong milk production globally, the impact of Russia's ban on the importation of dairy products, and the levels of inventory in China. Some relief has been provided by exchange rates, with the NZ dollar recently showing some signs of falling against the US dollar.
"Under the current market conditions, there is further downside risk. However, the forecast reflects expectations that prices will increase in the medium term," says Wilson.
Fonterra chief executive Theo Spierings says the estimated dividend range reflected the positive impact of a lower forecast farmgate milk price on product margins but also significant volatility in commodity prices.
"A lower forecast farmgate milk price reduces input costs in our consumer and foodservice businesses. In turn, we do expect to deliver increased returns as a result of a recovery in margins on our products.
"In addition, stream returns for non-reference commodity products such as cheese and casein are currently making a positive earnings contribution, but it is still very early in the financial year.
"With volatility in commodity prices, a wide range of outcomes are possible in relation to stream returns. The wider dividend range reflects this volatility, and at this stage of the financial year, it is not realistic to be able to accurately forecast the final result for the year within a narrower range."
Recent rain has offered respite for some from the ongoing drought.
New Zealand's TBfree programme has made great progress in reducing the impact of the disease on livestock herds, but there’s still a long way to go, according to Beef+Lamb NZ.
With much of the North Island experiencing drought this summer and climate change projected to bring drier and hotter conditions, securing New Zealand’s freshwater resilience is vital, according to state-owned GNS Science.
OPINION: Otago farmer and NZ First MP Mark Patterson is humble about the role that he’s played in mandating government agencies to use wool wherever possible in new and refurbished buildings.
For Wonky Box co-founder Angus Simms, the decision to open the service to those in rural areas is a personal one.
The golden age of orcharding in West Auckland was recently celebrated at the launch of a book which tells the story of its rise, then retreat in the face of industry change and urban expansion.
OPINION: The appendage swinging contest between the US and China continues, with China hitting back with a new rate of…
OPINION: The irony of President Trump’s tariff obsession is that the worst damage may be done to his own people.