Shipping crisis deepens
The shipping crisis caused by Houthi rebel attacks in the Red Sea and problems with a lack of water in the Panama Canal appears to be deepening by the day.
The long-running hotly contested Silver Fern Farms (SFF) and Shanghai Maling partnership is now complete.
SFF co-op chair Rob Hewett says this month’s completion of the $267m investment in SFF by Shanghai Maling will be welcome news to shareholders and suppliers.
“This partnership is a genuine game-changer for SFF. It delivers a strong and sustainable capital structure, the resources to accelerate our plate-to-pasture strategy in selected global markets and the capital to invest in optimising our production facilities and capability.”
Hewett says he believes a key factor in the joint venture is that it brings a collaborative and connected partner in the fastest growing red meat market in the world – China.
“We have had overwhelming support from our shareholders throughout this process, and we are excited by the opportunities this partnership with Shanghai Maling will provide.”
Shanghai Maling has invested $267m cash in return for a 50% stake in SFF’s business (now named Silver Fern Farms Ltd). Of the $267m, $57m stays with the co-operative, along with its 50% holding in SFF Ltd.
“The co-op board will [shortly announce] the process for redeeming about $5m of remaining supplier investment shares,” Hewett says. “In January, the terms of the $35m special dividend for the holders of ordinary and rebate shares will be decided.”
Hewett says both are expected to be completed by the end of February 2017.
Meanwhile, director appointments to the new SFF board have been announced, including two New Zealand resident directors, by Shanghai Maling:
Appointed by SFF: Rob Hewett (co-chair), Dan Jex-Blake, Richard Young, Jane Taylor and Trevor Burt.
Appointed by Shanghai Maling: Xia Xu Shen (co-chair), Gu Xiang Yi, He Ru, Sam Robinson and Michael Schubert.
Hewett welcomed Xu Shen Xia, the chairman of Shanghai Maling, as co-chair; Xu will take the director and co-chair role in place of Wei Ping Shen.
“I am delighted with the calibre of the board for the partnership.”
Analysis by Dunedin-based Techion New Zealand shows the cost of undetected drench resistance in sheep has exploded to an estimated $98 million a year.
Shipping disruption caused by Houthi rebels in the Red Sea has so far not impacted fertiliser prices or supply on farm.
The opportunity to spend more time on farm while providing a dedicated service for shareholders attracted new environmental manager Ben Howden to work for Waimakariri Irrigation Limited (WIL).
Federated Farmers claims that the Otago Regional Council is charging ahead unnecessarily with piling more regulation on rural communities.
Dairy sheep and goat farmers are being told to reduce milk supply as processors face a slump in global demand for their products.
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