It gives some personal time and space when others may be trying to be helpful by asking how things are and how farmers are getting on. The response can often be the opposite to that hoped for, with a further retreat from well-meaning neighbours and family.
This attitude can be seen in business decisions as well with farmers firmly clamping shut their chequebooks and redoing their budgets to trim out anything they regard as not strictly necessary.
While these ways of coping are understandable, and in the case of the second action sometimes absolutely necessary, a third way of attempting to deal with a suddenly changed reality can have a much greater impact outside the farmgate and through the wider industry.
That’s mirrored in a resolution to be put to the upcoming Fonterra annual meeting, where a Havelock shareholder is asking that the co-op’s investment spending be temporarily halted and staff salaries cut. His reasoning is that the money is needed onfarm – something most of his fellow shareholders would have no argument with.
But it would be incredibly bad timing for Fonterra to take its foot off the accelerator pedal when it comes to such important overseas investment decisions it’s recently made with Chinese company Beingmate, let alone funding going towards increasing milk processing capacity here in New Zealand.
Fonterra, like it or not, is part of a huge global race to gain a foothold, then rapidly build on that, in markets such as China. Yes, the growth rate there has slowed, which has had a direct effect on GlobalDairyTrade prices. But longer term this still looks more like a correction, even if more prolonged than hoped for, in a trend line which is going only one way.
The Chinese middle class continues to grow and with it their quest for secure and safe milk sources, particularly for their children. While economic growth might have dropped back a notch from its previous dizzying heights there’s no bigger game in town when it comes to future growth prospects. China remains a juggernaut, just starting to flex financial muscles it never knew it had.
For Fonterra to pause in its strategy to be part of this growth would be downright foolish. Ground lost now couldn’t easily be made up again and with the Chinese reliance on loyalty and long-term supply arrangements, any slip would not be lightly forgotten.
Right from the initial establishment of its first farm in Hebei province, Fonterra has concentrated on playing the long game, moving to set up more farms, then hubs, and more recently to cement the partnership with Beingmate which will give it access to distribution channels it could previously have only dreamed of, and that after throwing a lot of money in a myriad of different consumer directions.
Farmers need only look at what the rest of the world is doing in beating a path to China’s door. Recently Israeli company SCR Engineers announced it was collaborating with Nestle in the Nestle Dairy Farming Institute. The institute will aim to teach the Chinese about all aspects of modern dairy farming, so they can secure a viable future in the worldwide industry.
The 60ha institute is located in Heilongjiang province and includes a range of different sized, working dairy farms. The idea is that local farmers will grow their enterprises in a planned way, making use of an on-site academic centre with classrooms and laboratories.
SCR, which was established in 1976, is the world's largest manufacturer of electronic milk meters, with more than 300,000 sold worldwide under the DeLaval brand. In the past decade it’s been at the forefront of developing collar tags providing heat detection information as well as management software to analyse the data provided, with some of these used on NZ farms.
Six years ago it launched the first rumination monitoring tag which includes a specially tuned microphone to detect and record rumination, allowing farmers to detect disease early on.
In its collaboration with Nestle at the institute, the company will monitor all the cows as well as managing the data generated from them to provide farmers with access to advanced health and heat detection management. It will also provide training in farm management using the wide range of other electro-mechanical devices it’s developed, equipping a new generation of technologically savvy Chinese farmers, far removed from the subsistence farming systems of the not-so-distant past.
Farmers need to weigh up carefully what Fonterra could be seen as turning its back on if it suddenly had second thoughts about its Chinese initiatives.
Glenys Christian also writes a weekly column on the Dairy Exporter website.
