Federated Farmers shifts feed to North Island

27 March 2013

Federated Farmers shifts feed to North Island

With 70,000 small bale equivalents sent or about to be sent to the North Island from the South Island, Federated Farmers robustly states its position following some media reports.

“There is some confusion in the media about Federated Farmers efforts to get feed from the South Island into the North Island for drought stricken farmers,” says Bruce Wills, Federated Farmers President.

“Some articles and stories appearing in the media are incorrect and understandably are causing confusion and concern within the farming community.

“This is a really tough time for drought affected farmers. Federated Farmers wants to help where we can and have been working very hard to do so.

“With the entire North Island drought declared, feed is required from the South Island. While commercial operators are selling feed from the South to the North, it has become apparent that there is a constraint with transport capacity.

“To address this Federated Farmers has been working with potential shippers, feed suppliers and third party supporters.

“David Clark, the Vice-Chairperson of Federated Farmers Grain & Seed and others are working incredibly hard to pull a number of shipments together.

“Using the services offered by Pacifica Shipping and Hamburg Süd, a number of shipments have been completed with another being loaded today.

“Federated Farmers, together with road transport operators, Pacifica Shipping and Hamburg Süd have completed the following shipments totalling 2,320 twenty-bale equivalents:
One small shipment from Timaru to Napier
23 containers from Lyttelton to Tauranga
30 containers from Lyttelton to Napier, which arrived in Napier this week
20 containers from Lyttelton to Tauranga being loaded today.

“Over the next two weeks we will be shifting a further 50 containers north and by that stage Federated Farmers will have facilitated the movement of 3,520 twenty-bale equivalents.

“This equates to over 70,000 small bale equivalents of ryegrass straw/ryegrass hay.

“Each shipment has been for about 500 twenty-bale equivalents and has been pre-committed and financially underwritten by third parties. We are looking at further shipments of a similar scale

“While this has been underway, Ravensdown then kindly offered us space on a larger vessel to ship about 4000 twenty-bale equivalents from Lyttelton to Napier and Tauranga.

“This was welcome but it was complicated and we were unable to get all of our ducks lined up by the required deadline. We reluctantly had to let that opportunity go as it was simply too big a shipment to get everything organised on a tight deadline.

“Critical to the success of our feed operation is getting firm commitments from farmers to buy and pay for the feed. This must be a commercial operation because anything less could undermine the wider North Island feed market.

“There are also issues around ensuring appropriate feed quality, transport logistics, risk management around shipping the physical product and managing any bad debts. Farmers would also be required to pick the straw up from the Port on the day it arrives.

“There are limits to what even Federated Farmers can do as we are not a transport operator, feed merchant, bank or rural trader. For a shipment of this, far-larger scale, we needed signed contracts from farmers and/or a third party to mitigate risks if farmers didn’t pay, if it was rejected, damaged and to assist with other risks.

“The reality with this shipment is that we could not get either third party support or firm commitments from individual farmers to take and pay for the bales. It gets a bit tricky if you have 4000 large bales on the wharf and no one there to pick them up or pay for them.

“While we had to let that ship sail, we have continued the smaller shipments detailed earlier. Federated Farmers is also working hard to get another large shipment up and going over the next four to six weeks too.

“I must firmly say that Federated Farmers will leave no stone unturned to make the transport of feed from south to north happen. We are doing that right now with a ship being loaded today and tomorrow in Lyttelton.

“It is incorrect for people to hear Federated Farmers is doing nothing when 70,000 small bale equivalents have been or are being shipped south to north.

“Federated Farmers will continue to work on another big shipment and we will advise of more detail when we can,” Mr Wills concluded.

Federated Farmers continues to operate its 0800 Feed Line 0800 376 844 where both farmers who have surplus feed or who need feed can register their interest. The Rural Support Trust is available on 0800 787 254.

ENDS

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