Dairy should do what it does best, not join the lab race

Dairy should do what it does best, not join the laboratory race

Volatility is likely to be a constant companion for the New Zealand dairy farmer in the foreseeable future, and that has to be factored into their budgets, Andrew Hoggard says.

"We need to assume risk is there and make sure our businesses are resilient for it," Hoggard, chairman of the Federated Farmers Dairy Industry Group, told its national board meeting in Wellington today.

While global prices seem to have improved, "and I think we can start to get confident this season will deliver a milk price that is reasonable", Hoggard said he could not detect any great change in global demand that would suggest steady prices in the long term.

"To be blunt, it feels like the world is even more of an unstable environment to be trading in now than it was this time last year. That instability could go either way," he said.

"If the great wall of Trump is built, will it mean increased dairy trade opportunities to the south of it for us, and decreased competition from north of it, because all the people that do the actual milking got deported?"

In Europe, Dutch farmers may be forced to reduce their herd numbers to meet phosphate limits, or the politicians may cave in on that front.

"Will the Trump/Putin bromance mean the Russian dairy market opens up again, or will it remain closed?"

On competition from plant-based or lab-grown alternatives to dairy, Hoggard felt more confident.

Various commentators cite the example of Kodak and its slowness to react to the change to digital photography, and say New Zealand’s dairy industry should learn from that. But Hoggard believed that if the majority of world demand shifted to lab-produced food stuffs there would still always be a demand for naturally produced foods.

"But this will be a select market and the consumers will likely have high expectations.

"In my view our response as farmers to artificial food isn’t to join the laboratory race but to instead ensure that we have the best providence story we can provide to consumers. That means the bar will be continued to be raised in the areas of environment, animal welfare and workers."

Dairy farmers were tackling water quality issues head-on, despite what some critics claim, he said.

"[But] what we are concerned about environment-wise isn’t necessarily what the rest of the world is so concerned about. Overseas, more emphasis is placed on climate change and biodiversity.

"While we currently have a great story to tell around carbon-efficient food production here does any of us actually know how any changes to our systems might affect that claim? There is the potential that we could lose that world-leading position without realising it," he told fellow Federated Farmers members.

Our animal welfare regulations are among the world’s best, "however as competition gets tougher, when we trumpet our free range, pasture-fed status, expect to get questions around shade and shelter".

Antimicrobial resistance and proper use of antibiotics is another concern gaining traction. Again, we are among the best for low antibiotic use, "however our customers won’t want to know just what the averages are, they will want to see best practice on all farms they purchase from.

"Best practice means correctly identifying the illness, and treating with the appropriate drugs, and that critically important antibiotics are only used when first-line treatments are not sufficient."

Hoggard questioned whether every person on our dairy farms making treatment decisions on livestock had received sufficient training around treatment choices. He suspected not, "and in the future that is likely going to need to change".

ENDS

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