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Agriculture and Forestry Minister David Carter said today $20 million would be split between the New Zealand Forest Owners Association, the Foundation for Arable Research and the New Zealand Merino Company (NZMC) reports The ODT. At slightly over $15m, NZMC will get the lion’s share of the funding, and with their own funding input included, the three government-industry partnerships will be worth over $45m.The government funds will be received over five to seven years and Mr Carter said the economic spin-offs could amount to billions of dollars “if the proposals’ scientific and market research and product development are brought to fruition”.

“These proposals are of a very high quality, and stand to deliver enormous returns on investment,” he said.”When the PGP was launched in September last year, the aim was to transform great ideas into research, development, and ultimately products, jobs and growth.”Since then, industry participants have been working hard at refining business plans to provide evidence of how their proposals will add significant value to the New Zealand economy.”

Seven other organisations have to date gained funding under the PGP, which was set up after a $190m commitment from the Government in last year’s budget.

He talked to about 100 stud and commercial farmers, as well as beef industry stalwarts, at a Beef Expo celebratory breakfast, in Feilding, last week reports The Manawatu Standard.Professor Goddard said EBVs work, but there are unknown factors.”We know how EBVs work. But the genes that contribute to them – we don’t know.”He said there were many genes that contribute to factors such as growth rate, meat yield, and fertility, for example, but only one for colour.As if that is not enough of a problem, when it comes to beef breeds, markers need to be relevant across many breeds.

“The problem is that we are measuring a marker, not the actual gene that causes the effect. The marker might be a good predictor for the gene in Hereford, but not in Angus.”Prof Goddard said that means markers have to be really close to the causative gene, that way they have more chance of working in other breeds.People buying bulls for commercial use don’t need to know about DNA at all, he said, rather they could just buy based on EBVs as they do now.”But for stud breeders, they have to decide whether it is worth getting DNA tests for their bulls or cows in order to get more accurate EBVs.”

Getting DNA tests could allow breeders to ascertain whether an animal is good far earlier than usual, Prof Goddard said.”If you want to select a bull whose daughters are fertile, for example, at the moment you have to do a progeny test on the bull and that takes years. Whereas the DNA test is available at birth, so if you had a good test for female fertility, you could select bulls for that when they were calves.”"At the moment, tests are about $200. Our calculations say if it was reasonably accurate, that would be worthwhile.”He was hopeful the cost would come down as the test becomes more common in the future.

From the Livestock Improvement Corporation’s (LIC) website, the dairy industry is using DNA results to come up with better dairy cows.

 Yesterday Fonterra startled the industry and financial circles by following up a respectable opening forecast payout of $6.90-$7.10/kg milksolids for the season, which begins next week, with a longer range forecast of a possible $8-plus final season payout – if international dairy prices and foreign exchange rates hold at current levels.The opening forecast, which combines a milk price of $6.60 and a forecast distributable profit of 30-50c/kg, means around $650m more for the economy in the 2010-2011 year – but an $8-plus payout would mean a $2b economic bonanza, says Bank of New Zealand head of research Stephen Toplis.The $8 payout would mean a close to $1m income for a farmer producing the industry average of 120,000kg in the season. Out of this has to come the farm’s running costs, tax, labour, family costs and new Emissions Trading Scheme taxes reports Stuff.

Fonterra heavily stamped its new season forecasts announcement with cautions about market volatility, big swings in foreign currencies and economic turmoil overseas.The expectation in the industry is that farmers will keep their wallets firmly shut while they repair balance sheets battered by the global economic crisis and recent drought in some regions. They would reduce debt run up before the payout dropped like a stone overnight last year on the back of plummeting international market prices.Fonterra chairman Sir Henry van der Heyden said many farmers had suffered financial hardship and would use the higher payout to get their books in order. Mr Toplis said New Zealand farmers would be “wealthier” as a result of the payout hike, but it gave them a choice whether to invest more, save more or spend.”In the current environment one would assume they would probably save more than in past cycles.

“There is a golden opportunity now to get the dairy sector back on its feet, not just on its feet, but sustainably. The choice is in farmers’ hands now. Twelve months ago it was not in their hands because they were in dire straits.”Farmers would want to avoid a repeat of 2008-09 when the payout forecast went to a record $7.90, sparking speculation that it would end the season at $8.50 or $9 and prompting farmers to borrow accordingly, Mr Toplis said.The federation’s dairy chairman Lachlan McKenzie reminded farmers that this time last year the opening forecast was only $4.55.”I should add that current Ministry of Agriculture modelling shows that it costs a staggering $4.88 to produce one kilogram of milksolids …”

 Fonterra said it intended to retain 25 per cent to 35 per cent of the forecast 30c to 50c distributable profit.

Once dividends from profits are added, Fonterra could produce a payout of around NZ$7/kg. This would be the second highest payout in Fonterra’s history after the record NZ$7.62/kg paid out in 2007/08. Fonterra chairman Henry van der Heyden said it was possible the final payout could be over NZ$8/kg if the exchange rate and commodity prices stayed at their current levels. This would add up to NZ$2 billion to the economy from the NZ$2009/10 season, assuming the drought of the last few months does not hurt output too much reports interest.co.

Each extra dollar of payout adds around NZ$1.2 billion to the New Zealand economy and the forecast of a higher payout will boost the outlook for the economy overall and provincial economies such as Southland, Canterbury, Taranaki, Waikato, Manawatu, Bay of Plenty and Northland.

Fonterra also held its value of its shares at NZ$4.52 per share. Fonterra requires its farmer/shareholders to hold one share for each kilogram of milk solids it produces each season.

AHB chief executive William McCook said the prosecution showed the AHB would take action against farmers who fail to abide by livestock movement regulations. “It is clearly unacceptable that one man put his fellow farmers at risk for his own pecuniary gain. Selling cattle from a herd that is suspected or known to harbour bovine TB could have serious consequences for the national TB control programme. “We know a vast majority of the 73,000 cattle and deer farmers in New Zealand willingly comply with movement control restrictions and expect us to come down hard on those farmers who do not.

“This conviction sends a clear message to the farming community that the AHB will vigorously enforce the rules around the movement and sale of infected herds. “This complements the other methods we use to control the spread of TB such as monitoring compliance by checking animal identification and status declarations at sale yards and shows. “We also audit animal movements out of movement control areas, investigate overdue TB tests, act on complaints and, as with the Muir case, take action through the courts when necessary,” Mr McCook said.

“When it finished, there was a big sigh of relief of not being in the fish bowl and we were quite happy to not have any of that stuff happen for a little bit.” But with the benefit of time, he and wife Stacey realised they had got a “huge amount” out of the Meat & Wool New Zealand scheme, Mr Young said. “It improved our farming out of sight and was worth a lot of money to us.” Their profit more than doubled, he said.

The growth did not just come from a rise in lamb prices – returns were up in the third year even if the lamb price from the first year was used – but from a significant rethink on farm systems and diversifying where the farm income came from.

Many monitor farms had focused on lifting production levels to generate more income, but the Youngs wanted to lift the farm’s profitability by finding other ways of making money from their 460ha. Production was a factor in boosting profit, but a change in the mix of products and the way they farmed helping achieve the most benefits.

Better pasture management did bring production gains, and to a lesser extent a shift in breed from romney to grow bulk ewes, a romney-texel-poll dorset cross. This shift in breed was starting to pay dividends now but it was looking beyond his traditional land- use mix that made the biggest difference.

The lambing percentage did not lift dramatically, with salmonella brandenburg a problem last year, but average growth rates improved. Even though they were killing at the same time, average weights had lifted from 16-17.5kg to 17.5-18.5kg, Mr Young said. They had been understocked and were letting the spring and early-summer grass get too long and lose quality. By getting on top of that feed, they were able to produce better feed through the rest of the summer and that helped keep lamb growth rates up, he said.

A steak from a limousin-angus heifer raised by sisters Kathy Child and Yvonne Hill, of Whangarei, was judged the overall winner while an angus steak from Chef’s Choice, Whanganui, won the overall best of brand section for retail and wholesale butcheries. Angus also took out the first three places in the best of British breeds section. The four-day expo in Feilding is a shop window for many breeders who will be hoping to lure breeders and commercial farmers to their on- farm sales over the next two months reports The Dom Post.

Scottish cattle judges and angus breeders John and Marion Tilson chose a hereford as their champion bull of the sale, with an angus as reserve. The hereford, owned by Charles and Margaret Lee, of Leelands, Elsthorpe, was described as “a powerful bull with a lot of meat on it”, and later sold for $9000 to Bruce Robinson, of Kokonga Stud, Waikato.

When the angus bulls came up for sale the auction venue was filled to overflowing, reflecting the breed’s sudden lift in popularity since its steak of origin success in recent years and last year’s McDonald’s angus burger deal which has seen a premium paid for beef meeting the AngusPure contract conditions. The high point of the angus sale was a line of bulls from an evaluation trial, a group of young bulls gathered from throughout NZ and run together for 12 months while they were weighed, analysed and evaluated. One of the best of these, Turiroa Power, from Rick and Andrew Powdrell’s Turiroa Stud at Wairoa, fetched the sales’ top price of $26,000. The buyers were Colin Williams and Charlie Dowding of Kaharau Stud, Gisborne.

Auctioneer Bruce Orr, of PGG Wrightson, said the bull had good growth figures and was well- muscled, but what most excited bidders was what he described as its x-factor, an air of supreme self- confidence. Nine other angus bulls sold for five figures and the sale average for 34 bulls was $8425, well above last year’s $6650 average.

The expo’s other sales, of shorthorn, murray grey, simmental, south devon and charolais, were tame by comparison. The simmental sale was the most disappointing, with only seven of the 14 animals catalogued selling.

KPMG warned last month that NZ has little as five years before its farmers are undercut by trade rivals reports The ODT.”South America, Western China and Central Asia’s large scale intensive farming practices have the benefit of lower cost land and labour and normally have less complex regulatory regimes,” said the firm’s agribusiness chairman, Ross Buckley.

In addition, they were closer to key markets and able to deliver food to the customer at a significantly lower cost than NZcompanies.He also warned about under-investment in infrastructure including water sustainability, information technology, new science and education.At the same time, Mr Proudfoot warned government policy needed to be prioritised toward better investment, management and use of water resources.

Today, he said the budget failed to provide any significant funding to support the development of irrigation schemes, apart from $1.6m allocated to community irrigation grants to develop feasibility schemes and maintaining existing crown schemes. “Getting irrigation schemes off the drawing board and into construction to drive improvements in productivity is … critical to the future of the sector,” he said.

The budget also provided no further funding for the rural broadband initiative, another key piece of infrastructure to drive improvements in rural productivity.  The benefits that farmers and growers gained from changes would depend on the structures through which they owned and operated their assets, he said.