Speech – Federated Farmers

Keynote address by Bruce Wills, Federated Farmers President, to Federated Farmers 2013 National Council, Federated Farmers, Wellington.

19 November 2013

Keep it clean

Keynote address by Bruce Wills, Federated Farmers President, to Federated Farmers 2013 National Council, Federated Farmers, Wellington.

Federated Farmers has been busy since we last met as a Council in July.

Some of the bigger events include the official launch of the new sustainable dairy water accord, being a replacement for the previous clean streams accord, and now there is consultation on the proposed framework for freshwater management.

We’ve seen continued meat industry agitation for change and we live in hope that one day we might see substantive change!

The High Court finally brought an end to the Horizon’s One Plan after many millions of dollars and many years of angst. We also experienced the clostridium botulinum false positive and went through another round of Local Government elections.

Then there was the very welcome outcome for our members regarding their rural post deliveries.

At each of these events has been Federated Farmers. Together with our counterparts in the primary industries, we have stood together to achieve better outcomes for farming and the economy.

In today’s sanitised packaged world it is easy to overlook where our food and fibre comes from. It is easy to overlook the fact that farmers feed families and where water flows, food grows.

This National Council will see a number of launches involving new initiatives.

It includes the signing of a Memorandum of Association with the forestry industry. This is about farming and forestry being good neighbours and working better together. We will also launch “Keep it Clean” – a hygiene guide for agricultural vehicles. Federated Farmers will also formally launch a dedicated immigration pack for farmers seeking to employ migrant workers.

I can also confirm that our Farm Day concept will be back bigger and brighter in 2014 with open days in conjunction with the Ballance Farm Environment Awards and their regional field days.

My message to the New Zealand public is to come on farm and see what we do. Come and see how varied, how innovative and how committed our farmers are.

It will not come as a surprise that Federated Farmers biggest area of work and advocacy continues to be water. How we use it more efficiently whilst maintaining and improving its quality.

Most of our towns and cities store water to ensure their residents don’t run out of this valuable resource during the dry summer months. We need to get better at applying this same logic to our rural areas through water storage. The big challenge is how we can continue to grow farming but to do this with less impact upon the environment.

Many regions are ‘near drowning’ in water discussions and my thanks go to the many on our Council who are here today, who, I know, spend much time and energy to ensure farmers’ views are heard and that the outcomes are sensible for farming, the environment and our country’s economy.

This water debate is complex and it will take time.

The farming community must remain a leader in this debate. I want to acknowledge Ian and our respected water policy team for the good work they continue to do in this area.

Water does not instantly degrade but reflects cumulative actions over a period of time. Those actions may be farm related, they may be industrial and in some instances, they may be natural.

Getting good science is the starting point for the rational discussion we sometimes haven’t held when it comes to water. In two days time, Dr Jan Wright, Parliamentary Commissioner for the Environment, will release her much anticipated water quality report.

Parts of this report, frankly, will not be kind to agriculture but to improve we all need to understand what the problem is, what the science is telling us and then move to sensible solutions. We need to ask our communities what their aspirations are for water and what they are prepared to pay economically, socially and culturally.

As farmers, we have perhaps been guilty in the past of farming in denial about the nutrients we lose from our farms. This has changed thanks to the Land & Water Forum process. Diffuse nitrogen loss to water, as opposed to the direct loss you typically see in political cartoons, represents our biggest challenge but also, our biggest opportunity.

I have commented previously about my recent learning’s from World Water Week in Sweden. Compared to the rest of the world, New Zealand is in a lucky and privileged position when it comes to both the quantity and quality of our water.

It worries me that as a country we risk beating ourselves up around our water concerns. Of course we can and must do better but we do need to keep things in perspective.

The world is a hungry and growing place with an amazing 2.3 billion more stomachs due to join the human race between now and the year 2050. It is the sale of our food and primary commodities which helps to pay much of this country’s bills. Farmers share the aspiration to live in a prosperous and beautiful country with bountiful clean water for all.

This is the challenge of our time and I can confidently report that we are making steady progress.

Tomorrow, we will hear from the Governor of the Reserve Bank. I am sure Graeme Wheeler will take the opportunity to reiterate his concern and caution around the high levels of rural indebtedness.

With a better year forecast for most commodities, farmers have a good opportunity to ensure their debt is at sustainable levels.

History tells us that payouts will fluctuate and interest rates will inevitably rise. Retiring debt in the good years is for most, as sensible as making hay while the sun shines.

The farming outlook for 2014 is bright and farmer confidence is at levels we haven’t seen for years. The dairy industry is on track for its highest payout ever and as a sheep farmer, I may even get to make some money from wool this year!

What all of us know in this industry is that farming is a volatile business and we cannot control the weather.

I did a quick review of the nine years that I have been farming; we have seen average lamb returns for a 12-month period range from $50 to $150. Wool has gone from hardly worth bothering about to being worth a little.

Almost every second year we have experienced drought and in these nine years, we have had our wettest year since the 1980’s and our driest since the 1940’s. More recently we have experienced our most damaging wind storm since the 1970’s. That’s farming!

The key of course is adaptation, something New Zealand farmers are very good at. We read those financial and environmental signals and make changes accordingly. There are lots more we can do since I have already touched on water and the benefits more storage will bring.

More science is another important option. Our industry good bodies spend well over $80m each year to find better ways of farming. Unlike many industries outside of agriculture, farmers like me pay a small levy on most of what we produce. Farmers understand the importance of collective investment for the greater good.

The PGP (Primary growth partnership) and GRA (Global Research Alliance) are examples of government and industry working together for the benefit of farming and the wider economy.

I also hope that one day this country can have a less emotive debate about the science of genetic modification. As I say those two words, I know someone, somewhere, will be reaching for a keyboard.

Farmers need to have choices and access to good science to adapt and thrive with all the volatility I have just touched on.

At the international farmer meetings I have attended, the science, benefits or otherwise of GM is regularly and openly discussed. It worries me greatly that getting sensible discussion on this topic in New Zealand is too often shouted down before the facts are on the table.

And just before the switchboard overloads with calls, let me be very clear, I am not saying GM is good and nor am I saying GM is bad. I am just saying we need to be grown up and have a sensible grown up discussion about these technologies.

Along with science, innovation and new technologies are equally exciting. Just look what we now do with smart phones, which was inconceivable even six years ago. I cannot wait until I get my first farming drone; I have always dreamed of doing a lambing beat sitting in an armchair!

We must also continue to pursue freer trade with vigour through multilateral agreements, like the Trans Pacific Partnership and bilateral trade agreements too.

Current tariffs and trade restrictions costs our economy well over a billion dollars every year. It is estimated that for the average sheep and cattle farmer this equates to about $19,000 per annum and double this for dairy farmers.

Having recently returned from a World Trade Organisation meeting in Geneva I am increasingly optimistic that the logic of freer trade is gaining traction.

When two of the world’s most challenging issues are food security and climate change, allowing those countries that can produce food more efficiently to trade more freely with the less efficient food producers makes sense.

Look at what has happened since New Zealand signed a free trade agreement with China in 2008. An agreement not without controversy at the time.

Today, four out of every ten containers of milk powder which leaves our shores goes to China. In total, China takes a full quarter of our dairy exports, 15 percent of our export meat including 23 percent of our sheep meat. Half our wool goes to China too as does 70 percent of our logs.

The 2008 free trade agreement has been good for New Zealand and it has been good for China. The prospects of a successful Trans Pacific Partnership are just as exciting. The lure of getting tariffs of almost 40 percent removed from our considerable beef trade to Japan and Korea is worth pursuing.

I will be joining other Cairn’s group trading nation farm leaders in Bali next week to continue pushing for critical trade reform.

So in conclusion work continues apace here at Federated Farmers. We are making good progress to ensure farming remains an important contributor to a green and prosperous economy.

The outlook for the next 12 months is increasingly positive; the 2013/14 year looks like it will be a good one for farming and the wider economy. We need to make hay while the sun shines because what we know for sure is that not every year is kind to farming.

We must continue to focus on water, science, innovation and trade, all areas critical to farming’s ongoing success.

My thanks go to National Council and the Board for your leadership, your tireless work and your support. One of the many privileges of being National President is working closely with our staff; I have to say I am continually impressed and humbled at the commitment, professionalism and dedication shown by our very talented team.

Thank you all for helping ensure Federated Farmers remains the respected and effective organisation that it is today.

Thank you.

ends

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