Monday, February 15, 2010

Any old amount is not good enough…..

Fertco advocates heavy use of customising fertiliser requirements to exactly what farmers need – not willy nilly spread as much as you can philosophies….. this is important for both the farm and environment…. here’s why.

China using 'mind blowing' amount of fertiliser

Ecologist

14th February, 2009

Overuse of nitrogen fertilisers in China is leading to rapid soil acidification and is causing lasting damage to ecosystems, according to soil study

Nitrogen fertilisers used to increase crop yields in China are having ‘extreme’ environmental consequences, according to a study from leading soil scientists.
Scientists from China, the UK and the United States measured the pH of soil samples taken from agricultural land across China in the 1980s and 2000s and found widespread acidification caused by nitrogen fertilisers.
On average, the pH of soil across the country had decreased by 0.5 in 20 years. In parts of Hunan province, in south China, the pH of the soil had dropped to between 3 and 4.
Most crops are suited to a neutral range between pH 6 and pH 8.

Intensification drive
Dr Goulding, head of soil science at Rothamsted Agricultural Research Centre, said Chinese farmers had been encouraged to use more fertilisers to drive up yields, but had not been warned about the risks.

‘The message from the Chinese government was very simple: put nitrogen fertiliser on your crops and get more yield. The result in many parts of the country is extreme acidification,’ said Goulding.
Professor Peter Vitousek of Stanford University, who worked on the study, said the amount of fertiliser being used in China was ‘mind-blowing.’
‘Whereas on a grain farm in Illinois, an average of 200 kg of nitrogen fertiliser are being used per hectare, on a maize farm in China that could be as much as 800 kg per hectare.
‘More than half of that is not going into the crop: instead it's having grave environmental consequences downwind and downstream,’ he said.

Cutting fertiliser usage

Professor Vitousek said the research had shown that farmers could cut the amount of nitrogen fertilisers used almost in half without affecting yields.
'This would be an absolute benefit to the environment and farmer costs,’ he said.

Sunday, February 14, 2010

Emerging Markets view…. fertiliser

VALE Is Expanding Into Fertilizers With $1bn Stake in Fosfertil (Equities Analysts view)

This is great news. Our favorite mining company in addition to a dominant position in the iron ore markets they have deftly expanded into other minerals and now fertilizers. Vale’s Finance Director, Fabio Barbosa, stated, “Our perception is that the rapid per capita income growth in emerging markets will have a big impact on demand for protein, so there will be a structural shift in the demand for [fertiliser] which has only limited supply.” Per capita income growth in big emerging economies is the theme song for all of our investments!  As investors, we can buy better value at a better price and lower risk than developed markets.

It will also be very interesting to see if Vale begins purchasing their own ships in order to deliver ore to spot markets instead of relying on customers to collect.

Wednesday, February 3, 2010

Fonterra Invests In China

Fonterra has announced that it intends to invest in two more dairy farms in China to continue growing a high quality and secure supply milk on the ground.

Philip Turner, Managing Director for Fonterra China, said that the Chinese dairy industry is continuing to develop quickly but that the current supply of high quality fresh milk cannot keep up with demand.

“We are looking to help grow a safe, secure and sustainable milk supply in China in order to meet this demand and expand our customer base.”

The China dairy market is set to become the world’s largest dairy market in the next few decades and is forecast to experience double digit annual growth over the next 10 years. The Chinese Government has acknowledged that the development of the dairy farming industry is not only crucial for meeting the growth in demand, but also for developing rural communities and their livelihoods.

Mr Turner said Tangshan Fonterra Farm, Fonterra’s pilot farm in Hangu established in 2007, had succeeded in demonstrating that Fonterra can successfully produce New Zealand standard milk in China. It has reached target production levels ahead of timetable and is producing record levels of milk for China.

“We are confident that with further investment in good technology, people and high quality genetics, we can replicate this model on further farms. This will complement our New Zealand milk supply and help us better meet the needs of our key customers, who are increasingly looking for local sourcing capability.”

Fonterra has identified several possible sites for the new farms in Hebei Province and will consider partnering on the investment. However, Mr Turner said Fonterra would want to have full management of the farms.

“It is important that we keep the next two farms in close proximity to Tangshan Fonterra Farm in order to achieve efficiencies in transport, milk supply and Fonterra management.”

Mr Turner said due diligence was already underway and the aim was to complete the final long-term lease agreement by mid-2010.

Tangshan Fonterra Farm is already producing its second generation of China born heifers, following two successful rounds of calving since the farm was first established. The total herd has grown to nearly 5800 cows, around half of which have been raised from the original imported herd of Friesians.

Each of the new farms is planned to be of similar size to Hangu, with around 35 hectares of land and around 3300 milking cows, creating employment and training opportunities for 350 people in Hebei Province.

Tangshan Fonterra Farm manager and experienced veterinarian Todd Meyer said the second round of calving was proof that Fonterra had successfully adapted the New Zealand-quality herd to the farming environment in China.
“We couldn’t have asked for a better result. We have introduced new China-born blood into our herd and are meeting our production targets for high quality local milk.”

TheCattleSite News Desk