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Looking across the fence

By Karen Silk - Westpac’s Head of Agri Business.

New Zealand’s global reputation in agriculture has been gained through decades of hard work. The challenge for New Zealand farmers in the 21st century will be to work smarter, believes Westpac’s Head of Agri Business, Karen Silk.

The recent national debate on how New Zealand can grow its knowledge economy has highlighted the potential role of sectors such as design, biotechnology and information and communications technology (ICT). However, amid the discussion on whether New Zealand is riding the knowledge wave or becoming a Third World backwater, there has been little mention of the role of agriculture, the sector that provides the backbone of our economy.

For example, our dairy industry is New Zealand’s top export earner, accounting for nearly one quarter of our exports by value. New Zealand earned $7 billion from dairy exports last year, despite international trade barriers.

As New Zealand’s biggest merchandise exporter and a major foreign-currency earner, it is clear the 189-year old dairy industry has a vital role in New Zealand’s future prospects. Last year the national dairy herd increased by 6 percent to nearly outnumber our human population, and today the average farm is nearly 100 hectares, compared with 83 hectares 15 years ago with around 270 cows. In 1988 New Zealand had a total of 3.2 million cows with the average herd size 223 dairy cows.

Optimism about dairying’s future is also widely shared, not just by sheep and beef farmers converting to dairy, but also indicated by the influx of young, talented people to the industry.

The dynamism of dairying has also been accompanied by a willingness from farmers to try new things, as well as take on board the accumulated wisdom from decades of dairying. Smart farmers are increasingly looking over the fence to compare their performance with their neighbours, as well as share ideas for improvements and innovations.

Over the last century we’ve seen production per cow increase, due to both genetic gain and improvements in farm management. Improved grasses, animal remedies, fertilisers and machinery have more than doubled milksolid production since 1920. In the 21st century, there are efforts to utilise biotechnology, improved equipment/machinery design and ICT to improve production and gain added value from the many components which make up milk, from the use of GPS for milk collection and the design of better equipment, to the manufacture of functional foods from milk proteins and alcopop drinks from lactose.

While it may be the end of the season before farmers have time to review their herd’s performance, opportunities do exist for dairy farmers to benchmark against neighbouring farms as well as the best farms in other regions. The Fonterra Westpac Dairy Excellence Awards provide the chance for dairy farmers to be proud of their achievements. The awards, with regional and national finals, not only select the best dairy farmers, but they also provide a forum for farmers to exchange information on their best practice.

While for some farmers their milksolids total for the season, and therefore their payout, is the bottom line, the awards also take into account a variety of factors in deciding the crème of the crop, including business growth, human resources, productivity, quality management, and environmental integrity. The winners raise the bar for the industry and set the standard for future performance. The Fonterra Westpac Dairy Excellence Awards have been run in seven regions, with the winner of each region progressing to the national final on 27 June. The awards also show urban-dwellers that farming is a complex business, involving not just cowpower and manpower but brainpower too. The dairy industry is a multi-national, multi-billion dollar business involving around tens of thousand of New Zealanders. Improvements in dairy farming will flow onto local communities and boost regional growth, which in turn creates a strong national economy that benefits all New Zealanders.

With more than sixty percent of New Zealand’s merchandise exports being agricultural or forest products, smart agribusiness is, and will continue to be, the driver of our nation’s wealth. Dairying will be the flagship among New Zealand’s agricultural endeavours.

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