Home' NZ Dairy Farmer : January 2010 Contents 28 The Dairyman JANUARY 2010
THE representative body of New
Zealand's agricultural technology sec-
tor believes the United States is at a tip-
ping point in adopting pastoral technology
over traditional grain fed confinement sys-
tems in areas with an appropriate climate.
New Zealand Agritech Inc (NZA) chair-
man Jim Grennell said at a recent conference
in Hamilton that there were opportunities for
New Zealand as a producer of food and as a
generator of farm intellectual property.
The organisation identified opportunities
in the south east of the United States, where
they don't produce enough milk for the pop-
"A lot of dairy product gets trucked from
long distances to feed the population base,"
Mr Grennell said. "Only 51 per cent of the
south-east's volume requirement is produced
locally. Trucking product is inefficient and
costly and establishing production closer to
the consumer market is more compelling".
He said the majority of dairy products
there are produced predominantly through
confinement systems: some as large as 5000,
10,000 or 15,000 cows.
Mr Grennell showed pictures of the costly
infrastructure that supports some of those
operations. "American dairy farmers work
on a milk-to-feed profitability ratio and
when it exceeds three it is considered prof-
itable." When the Agritech contingent visit-
ed in October the ratio was 2.04.
NZA chief executive Colin Kennedy said
the dairy industry there was tenuously placed
at the moment because of the high cost struc-
ture of fuel and supplementary feeds and low
milk prices along with sustainability and ani-
mal welfare issues on the horizon.
"These matters are making the efficiencies
of pasture based farming adaptations
increasingly attractive to the American
farmer," he said.
"New Zealanders are acknowledged inter-
nationally as world leaders in low input
intensive rotational grazing systems, which
gives us a brand advantage in that market."
NZA recently signed a strategic coopera-
tion agreement with Cullen Agricultural
Technologies Inc, a USA incorporated
research and development company commit-
ted to the development and commercialisa-
tion of advanced agricultural technologies,
primarily focused on the animal food sector.
The agreement to fast-track the rollout and
commercialisation of Kiwi pasture technolo-
gy in the south-eastern United States is
reputed to have market potential earnings in
excess of $US100 million to New Zealand.
Dr Richard Watson of Cullen Agricultural
Technologies said the agreement with NZA
is an important and public step towards
Cullen's recognition as an exporter and com-
mercialisation platform for New Zealand's
products and technologies, with immediate
focus on the United States.
"The Southeast USA is ideal for pasture
based farming, but we must stress it is not
New Zealand and there is significant
adaptation of New Zealand technologies and
management practises required to make it
work," Dr Watson said.
"This is where Cullen's presence and
experience as a proven applicator of these
technologies combine to provide the plat-
form for NZA members to enter a market
which has significant potential."
Mr Grennell shared pictures of the conver-
sions currently underway one acquisition
being 1457ha of cropping land partially in
peanuts. Three dairy farms will be convert-
ed by April 2010 bringing the total to five
farms over 2023ha.
He said the shed builders and fencers were
sourced from New Zealand as the job could
be done much faster by taking people over
there on a contract basis to complete the
establishment phase once operational local
people are trained and employed in the day
to day farming activities.
"One of the challenges there is the cattle --
when you are breeding up numbers quickly
with a market that doesn't have the right
genetics you more or less have to take what
you can get then do the necessary cross
There were 9.2 million cows in the US in
2008 but the current crisis had seen numbers
culled through an increase in the slaughter of
animals and herd buyouts organised by the
US Department of Agriculture.
Dr Watson said the south east could easily
accommodate the USA dairy industry on
New Zealand-style grazing farms and would
require between 15 and 20 million cows on
Mr Kennedy said Cullen had invested in
five farms and would not stop there. Other
investment groups had shown interest too.
He said, for the first time the incoming
president of Dairy Farmers of America was a
pastoral farmer and the organisation was set-
ting up advisory units to help farmers change
from grain fed confinement systems.
Mr Kennedy said the consumer desire for
naturally produced food was driving some of
US moves towards pastoral farming
"New Zealanders are acknowledged
internationally as world leaders in grazing
systems, which gives us an advantage."
--- Colin Kennedy, NZ Agritech chief executive
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