Write Here,Right Now

Winston Peters: has been performing same old tricks for more than 30 years

WINSTON PETERS has been at it again, hiding behind the cloak of Parliamentary privilege to deliver another conspiracy-riddled attack, this time on the directors and farmer shareholders of Silver Fern Farms.

Last week Peters took a call in Parliament’s weekly general debate to rant and rave about the SFF/Shanghai Maling deal and made all sorts of spurious claims – all the while his sycophant caucus of no-names and nobodies nodding, jeering and gesturing like trained monkeys.

It is obvious Peters has neither the cohunes nor the facts to back any of his wild claims outside the House, therefore rendering his argument – much like his entire political career – full of hot air and empty rhetoric.

The fact that neither Peters nor critics of the SFF/Shanghai Maling deal will admit to is that 82.2% of Silver Fern Farm farmer shareholders (the owners of the co-op) voted overwhelmingly in support of the deal. Farmers – not the Government – own SFF. During the last days of Government control of the NZ meat industry – in Peters’ heyday of the 1980s – it was an unmitigated disaster.

NZ First’s objection to the SFF deal is little more than grubby politics – a deliberate plan to try to mine the 5% of the vote it needs to survive in Parliament, from redneck elements especially in rural and provincial NZ.

They have been trying to stir up fears about the ‘Chinese takeover’ for months, even making unsubstantiated claims that Finance Minister Bill English “refused to meet with the board of SFF for over a year”. When this accusation was put to SFF chair Rob Hewett by Rural News back in October his answer was blunt: “That’s bullshit.”

But that’s Winston Peters for you: full of the proverbial and never letting the facts get in the way of the real story.

The reality is somewhat different: Shanghai Maling already wants SFF product made and packaged in NZ and sent shelf-ready to China. SFF chief executive Dean Hamilton (who according to Peters will, with chairman Rob Hewett, be axed by Shanghai) told a recent China Business Summit that, contrary to another Peters’ claim, “We aren’t about to build a plant in Uruguay or China [because Shanghai Maling] wants this product 100% made in NZ.”

The Shanghai Maling JV not only assures the balance sheet but also brings real value to SFF on many fronts – not least 6000 supermarkets to which the new partner has access in China.

SFF farmer shareholders saw this huge potential and hence overwhelmingly voted in favour of the Shanghai Maling deal. That’s because these farmers are modern-day business people who know that in the year 2015 we need to be open and focussed on the world – especially Asia.

They bear no resemblance to a broken-down, one-trick, political pony, well past his prime, stuck in 1985 wanting NZ to close the door against the invading yellow peril!

Quad bike safety is a major issue for NZ farmers

IT APPEARS much of the angst and anger percolating through the farming sector over proposed changes to health and safety regulations may now have eased.
The parliamentary transport and industrial relations select committee – charged with reviewing the Health and Safety Reform Bill – has recently reported back and proposed changes, many of which the farming sector has been calling for.
As Fed Farmers health and safety spokesperson Katie Milne says, the changes to the bill go some way to recognising that farms are different from urban industrial workplaces. She applauds changes that mean farmers would not be held liable for the safety of people who – without the farmer’s knowledge — enter their properties and suffer an accident. It is now made clear that recreational users coming onto farmland would be responsible for their own safety – duck shooters, hunters, mountain bikers, anglers and so on.
It’s good that parliamentarians have listened to farmer concerns and put the responsibility back on recreational users where it always should have been. As Beef + Lamb NZ chairman James Parsons says, it is good to see the select committee process working and acknowledging farmer concerns.
BLNZ say key changes to the Health and Safety Reform Bill go a long way to clarifying the responsibilities of farmers towards employees and visitors to their farms. Other changes recognise that a farm’s family home is excluded as part of the workplace. This acknowledges the unique features of farms as workplaces and homes for rural families and applies good common sense to the issue of improving safety onfarm.
Fed Farmers and BLNZ concede there are still issues that need changing to improve onfarm safety, while taking into account the practicalities of modern farming. Both say they will keep working with the Government and officials to seek a practical outcome.
This pragmatic attitude is far different from the reaction by unions and Opposition politicians who claim the changes ‘gut the bill’ and disregard workplace safety. That is rubbish!
As WorkSafe NZ’s Al McCone says, “if a workplace has a culture of posting rules but ignoring them it will be held liable”. His encouraging advice to farmers is, “if you are doing things well under the current legislation, you will be doing things well under new legislation”.
But McCone also warns that workers must take reasonable care to ensure their own safety. So if a farmer tells a worker to wear a helmet and he doesn’t, and gets killed or hurt, the farmer will not be held responsible.
We hear the collective sigh of relief in the rural sector as common sense prevails.

IT IS understood that top officials from 12 Pacific nations negotiating the Trans-Pacific Partnership (TPP) free trade pact are planning to convene in Hawaii at the end of this month for a final push to get agreement – an indication that we may be nearing a deal.
The US Congress last month expanded negotiating authority for President Barack Obama, setting up a potentially deal clinching meeting of trade officials.
It’s estimated the TPP would add about 2% a year to the New Zealand economy. Services, tourism and IT would make up about 40% of this increase, agriculture 25%, the remainder coming from investment. The TPP region represents 792 million consumers and 40% of world trade. In 2012, trade among TPP partners was at least $2 trillion.
According to a professor of international finance at Brandeis University, Peter Petri, recently in New Zealand, a successful TPP agreement appears more likely now the US has agreed to fast-track negotiations.
For NZ, one of the biggest sticking points is access for its dairy products: the US, Canada and Japan have highly protected dairy industries.
The US is believed to be pushing Japan to open its long-protected market for beef, pork, dairy and rice products. Japan, in turn, is seeking the end of US tariffs on cars and trucks.
Petri claims the US is “for the most part” working with NZ on dairy issues.
“The big problem now is Japan and Canada, and even in Canada you have a modern dairy industry which would sooner be rid of supply management,” Petri said.
Regarding the controversy over the TPP, Petri believes the issue has not been handled well politically. “They should have kept negotiations within the room but at least described the broad lines of negotiations more publicly.”
However, conspiracy claims – led by anti-TPP critics such as Jane Kelsey and politicians who know better – about the TPP being a ‘big business’ takeover of our national sovereignty, and other scare stories, are laughable.
It is deplorable that the anti-TPP people like Kelsey et al get to make such uncontested claims and have unfettered media coverage. Yet the work and word of honest and dedicated people such as special agriculture trade envoy Mike Petersen and diplomatic, trade and government expert Stephen Jacobi, who believe the TPP will have huge benefits for NZ, are ignored.
Petersen and Jacobi – or the NZ Government for that matter – are hardly going to sell our country or the agriculture sector down the river to benefit the Gnomes of Zurich or any other interest group.
Meanwhile, Gary Hufbauer, a senior fellow at the Institute of International Economics, believes the planned high-level negotiating session suggests officials from most or all the countries believe an agreement is within reach now that Congress has approved the negotiating authority Obama sought.
“I think a deal is close, but the end of July seems optimistic. The end of August seems more likely.”
Let’s hope so. New Zealand – our agriculture sector especially – stand to benefit greatly.

KISS — Keep it simple!

THE NEWS that Fonterra is to hire international consulting firm McKinsey & Co to see what needs to be changed in the organisation is breathtaking.
It seems a lot of people in the co-op are earning a million or more dollars a year, so what don’t such people know and why can’t they fix it themselves? Many were presumably responsible for the co-op’s present structure, so what’s wrong?
McKinsey will for a small fee (yeah, right) propose some sort of change to the structure. But we hope they look beyond structure and truly analyse the culture of Fonterra, which is the greatest source of complaints from many of the people who deal with the dairy giant.
The word arrogance is frequently used to describe the way Fonterra behaves to external stakeholders and farmers. ‘Fortress Fonterra’ is another expression. The co-op’s communication style gets people’s backs up. They seem to assume a God-like position, which does not fit well with the salt-of-the-earth farmers they supposedly represent.
Understandably, some Fonterra suppliers are looking sideways towards other companies to which they could sell their milk. Fonterra’s hold on the milk supply is slipping as companies such as Miraka and others show what can be done. They also offer a closer relationship – a whanau approach – which is very appealing to many.
In its latest Agribusiness Agenda, KPMG suggests that in 10 years Fonterra may control only 70% of the New Zealand milk supply – down from 85% today.
This is not to say Fonterra is bad; in fact it is a great company and NZ Inc. needs a strong Fonterra. But it seems to many that the body corporate has become disconnected from its shareholders. The great work of Fonterra is being undone by poor communications, which is an easy fix. PR spin and new buzzwords such as ‘velocity’ will change nothing and impress no one.
The solution is frequent, timely, honest, simple, straight talk. Surely that’s not too much to ask.

Michael Woodhouse

WORKPLACE RELATIONS Minister Michael Woodhouse recently described the existing workplace safety legislation a ‘bugger’s muddle’. It seems the proposed new legislation isn’t much better, given that it’s been sent back to the transport and industrial relations select committee for “further consideration” – code for “it’s still a bugger’s muddle”. Everywhere farmers are revolting at the prospect of some of the items in the proposed legislation – especially the ‘threat’ to ban passengers from quads and the prospect of farmers being overwhelmed by paperwork in having to conform to so-called safety plans. At the best of times bureaucrats are tolerated but seldom loved by farmers or even politicians, who see them as a hindrance rather than a help. In this particular case, WorkSafe NZ has got itself off-side with many in the farming community – including some of its highly respected leaders. Even Woodhouse conceded to Rural News recently that WorkSafe has a “perception problem” with farmers. Farmers are not against the intent of the legislation and they want to reduce accidents on farms, but they feel that the bureaucrats are not listening to them but are instead proposing impractical solutions, and that are driven by ‘process’, rather than outcomes. Farmers also see WorkSafe as being out there to get them and prosecute them for what they (farmers) see as minor infringements. Farmers’ vocal opposition has not unnaturally been directed at local MP’s, mostly National Party ones, many of whom are themselves farmers, therefore openly sympathetic and very sensitive to the rural revolt. To support the new legislation, as it stands, would be ‘courageous’ on the politicians’ part but it’s well-known that ‘courageous decisions’ can be politically suicidal and career ending. (A bit like Andrew Little’s idea of means-testing workers over 65). So faced with a rural revolt the Government has sent the bill back to the same select committee that produced the outcome that is still deemed politically unacceptable. Will they do better this time as they mull over the legislation, fortified by a cup of tea – or something stronger? Will WorkSafe NZ back down and modify some of the more contentious proposals? Will the Prime Minister and the Cabinet get involved in some way to ensure the select committee comes up with a more politically acceptable piece of legislation? Or will some sort of deal be done by WorkSafe NZ and farmers to sort this out quietly behind closed doors and present a solution to the committee that lets the politicians off the hook? The rural jury is out.

FONTERRA’S HALF-YEAR results make unhappy reading to its 10,500 farmers, many struggling with drought and a precariously low payout.

The co-op’s much heralded ‘V3’ strategy – volume, value and velocity – is leaving farmers vexed. Last week’s round of farmer meetings were heated, with some threatening to pull milk supply, others questioning the co-op’s ethos.

Fonterra’s management and board have a lot to answer for; how could things turn from a record payout of $8.50/kgMS payout in 2014 to pear-shaped within 18 months?

We accept that dairy prices have plummeted around the world and Fonterra as a global player isn’t immune to geo-political factors in some regions. The false botulism scare and nutters threatening to contaminate infant formula didn’t help.

But as a co-op, Fonterra’s first and foremost duty is to its farmer shareholders. The co-op’s decision to invest billions in factory upgrades and farms in China are being looked at by farmer shareholders with scepticism.

The co-op’s strategy on volume is to grow its milk pools around the world; on value, to obtain more value from every drop of milk; and on velocity, to execute strategy at speed.

The problem is this strategy is not translating into a better payout; even in a year of low milk price Fonterra has been forced to drop its dividend forecast by 5c/kgMS. It blames higher milk prices in some overseas milk pools for squeezed margins.

In Australia, Chile and Brazil milk prices are influenced by market dynamics rather than global prices. This prompts the question whether Fonterra is doing right in rushing into setting up milk pools around the world. Fonterra farmers are watching as the V3 strategy snatches billions of dollars snatched from their businesses while their borrowing costs climb and their bottom lines take a hammering.

The board must sit up and listen to farmers’ concerns, chiefly by immediately reviewing the V3 strategy to start delivering to farmer shareholders.

It’s all good to have a global strategy to increase Fonterra’s footprint, but all will come to nought if farmer shareholders abandon the co-op, thereby leaving the New Zealand milk pool in jeopardy.

Becoming a global giant at the expense of its hard working farmer shareholders isn’t an option for Fonterra.

You can’t negoitate with eco-terrorists

ENOUGH IS enough! That’s our message to the nutter or nutters responsible for the latest food safety scare to hit the dairy industry.

Whoever sent those anonymous letters containing white powder laced with high concentrations of 1080 to Federated Farmers and Fonterra three months ago is an eco-terrorist; this person or persons must be hunted down and face the full force of the law.

The perpetrator is bound to fail; there is no place in the society for such zealots. If you have a problem with 1080, take your gripe to the courts; stop threatening our country’s reputation.

This attempted sabotage affects not only dairy farmers, who work tirelessly to ensure safe, high quality raw milk leaves their farms every day for the processing plants. It has also affected processors striving to maintain premium quality – the entrepreneurs competing with global traders to ensure consumers feed New Zealand infant formula to their babies.

This 1080 scare has instilled fear and anxiety in parents and grandparents. Is this what the nutter/nutters wanted to achieve?

Let’s look at 1080. The authorities consider it safe to use, but there are conservationists and hunters who would like to see this pesticide banned. Fortunately most conservationists and hunters take a balanced view; one or two may choose to spend days and nights squatting in a kauri tree to prevent its destruction, but we doubt any would condone putting poison in baby milk powder.

New Zealand sells $440 million of infant formula to international markets each year, representing 3% of our total dairy exports. At times like these we say thank God for our stringent checks and balances on food safety.

The international markets buying our infant formula were given a heads up before authorities went public with the threat last week, and so far it’s business as usual in most markets. These markets – crucially the lucrative Chinese market— have faith in our food safety systems; rigorous workplace practices are ensuring the integrity of our products.

However, some countries, like Sri Lanka, have used such cases to slap bans on our milk products. Such countries are intent on gaining a competitive advantage over our milk products.

Also, other infant formula producers worldwide will be keeping a close eye on developments. While no commercial infant formula producers will condone such a hoax, some will end up benefiting from this latest case.

The Government, Fonterra, the dairy industry and retailers are banking on our food safety credentials to see us through. We’re confident that after a possible knee-jerk reaction parents’ confidence will bounce back too.

Will the latest report into the red meat sector by the MIE Group prove to be anything but another doorstop?

THE MEAT Industry Excellence Group’s (MIE) much-vaunted and so far highly secretive report into meat sector reforms is due to be released later this month.

No one can accuse MIE and its supporters of lacking passion or determination, and their initial efforts in rousing farmer support and getting endorsed candidates onto the boards of Alliance Group and Silver Fern Farm is commendable.

However, passion and understanding aside, this knotty question remains: given all the huffing and puffing by MIE, what real and tangible reforms will it actually achieve? The reality is that getting a couple of directors onto meat co-ops’ boards, and increasing voter turnout among apathetic suppliers is nice – but it doesn’t mean much.

Not long ago MIE’s predecessor ginger group MIAG (Meat Industry Action Group) was calling for similar meat sector reforms and even got a number of endorsed candidates onto the boards of Alliance and SFF.

And what happened? MIAG’s leader gave up and went dairy farming, while its meat company directors either retired or got voted off the boards and nothing has changed in the ensuing years!

MIE claims it has… “strong farmer support for a new processing and marketing co-operative with much greater scale…. There is clearly a groundswell and we need to get on with it.”

But will this ‘groundswell’ translate into actual support forMIE’s recommendations for reform when they are finally published? Especially when it requires farmers to dig into their own pockets to pay for industry consolidation (read plant closedown) and reduces their opportunity to shop around?

And how will farmers feel about the lack of capacity in the industry when they are desperate to get stock killed in a dry year?

No doubt all will be revealed when the MIE report is published.

While admiration for the group’s efforts and work are one thing, one gets the uneasy feeling that this latest effort at meat sector reforms will just turn out to be another doorstop – with a $200,000 price tag.

It would be good to be proven wrong, but the history of the New Zealand meat industry is littered with good intentions and dozens of ‘change reports’.

Don’t hold your breath.

Quad bike safety is a major issue for NZ farmers

THE SAFER Farms initiative, recently introduced by WorkSafe NZ, is a timely one.

Since 2008, 120 people have been killed working on farms in New Zealand: four times more people died on farms last year than in forestry or construction. Figures show that someone is killed on a farm every fortnight; this is a shameful record and it must change.

Improving farmer awareness and understanding of risks involved, along with education on how these risks can be minimised and/or managed, is a more effective and better approach to changing these appalling statistics than dishing out heavy-handed fines.

While farmers may strongly believe in personal responsibility, rather than having ‘big brother’ telling them what to do, they have an inherent intolerance of bureaucracy and attending to endless compliance documents. Still they need to clean up their collective act.

The stats don’t lie. Far too many farmers, farm workers and their families are killed and/or hurt on our country’s farms every year. There is no excuse for the poor safety record these statistics show. Any initiative that saves lives and protects people should be strongly supported.

While many farmers may disagree with some recent interpretations of the Health and Safety Act, like the carrying of quad pillion passengers and heavy fines for not wearing helmets, it is clear the ‘carrot’-only approach is not working. The option to implement the ‘stick’ – fines – is a necessary one.

Yes, farming can be a dangerous occupation, but farmers and their staff must take all necessary precautions and be aware of the risks involved to mitigate the risk of accidents/and or deaths on farm.

Let’s hope more farmers are becoming more aware of the health and safety issues in their workplace. As Peter Jex-Blake, Federated Farmers Gisborne/Wairoa provincial president, said at the Safer Farms launch in his regionlast week – a change in culture is needed. “It requires a change in mind-set; which will take a while, but with the right approach, we will get there.”

Work Safe Minister Michael Woodhouse is right when he says, “The number of deaths and injuries on farms won’t be reduced by the Government sending out more inspectors. Only farmers can directly influence this toll.”

Hopefully Safer Farms will help them do this by finding health and safety solutions that work.

Fed Farmers national president William Rolleston has a key job to do in maintaining the lobby’s credibility with both its membership and the wider community

FEDERATED FARMERS has undergone a major transition during the past four-five years.

Gone are the days when the Feds would fire out deliberately antagonistic statements chastising government or industry critics for some perceived action – or lack of it. The days of being a screaming skull and demanding attention are thankfully behind it.

For Federated Farmers to be credible, with its members and the wider community, it has to be credible.

Like it or not, the reality is that Feds is the only organisation that can nationally represent the farmer’s view.

National president William Rolleston and chief executive Graham Smith are fairly new in their roles, but both have a similar attitude to what the organisation should be saying and how it should say it. They are firm believers in a ‘quality not quantity’ message.

The move by the organisation’s former chief spin doctor to work for Winston Peters, late last year, has also been timely for Feds. The bombastic style of his messaging is far better suited to an outdated, antiquated, one-trick pony, political dinosaur like NZ First than a modern-day farmer lobby.

However, Fed Farmers remains an advocacy lobby for farmers and so at times it will have to be unabashedly pro-farmer and even controversial. But this approach soon loses impact and effect when it is the lobby’s only modus operandi.

A key challenge for the farmer lobby is how to the repair the reputation of the agricultural sector with the general populace. Too often farmers are portrayed in the mainstream media as moaners, environmental vandals, money hungry bludgers, uneducated oafs and/or any combination of these descriptors.

These kinds of narratives have gone unchallenged for too long – meaning the relationship and understanding between town and country is no longer a small gap but a yawning divide.

Federated Farmers has an important role in helping close this divide. It has a far better chance of winning the hearts and minds of detractors when it is acting with credibility and facts.

It is a big job and will take a huge effort, but the work needs to start now!