KEY POINTS:
The growing move by New Zealanders to establish agricultural operations overseas is clearly something everyone in the rural sector needs to keep an eye on, judging by comments from a range of primary industry leaders in recent interviews.
While it's important not to over-hype this increasingly popular form of overseas experience, it would be foolish for both individuals and corporates not to observe how things are developing.
Achieving the best results overseas will require both big-picture imagination and attention to detail. And, as ABN AMRO Craigs' Neil Craig has suggested, one of the keys to further success overseas will be looking for "arbitrage" possibilities - that is where kiwi capital, systems and know-how can be more profitably applied overseas than at home.
There's also the opportunity to develop operations which complement onshore activity.
But, as Fonterra's interest in running a dairy farm in China shows, overseas investment can also be about positioning yourself to best take advantage of growth opportunities overseas, as well as doing what you do well at home.
More overseas developments will cost Fonterra more money and just how much these sorts of potential deals influence the debate this year about the future of the co-op's capital structure remains to be seen.
But it's obvious the global vision of New Zealand agriculture is widening even further.
So it's truly a case of "watch this space" - closely.
Zest for life
A Pukekohe-based inventor is hoping to take on the world with an organic agricultural compound called Agrizest, which, it's claimed, enables pesticide-free crop and wine production by naturally enhancing the immune system and growth of plants.
Nathan Balasingham's Agrizest compound - based on his master's project from the 1970s and subsequent work - includes extracts from sea kelp and phospho lipids (or fatty acids).
Made in an old Fonterra factory, it's said to "switch on and sustain the immune system of plants", allowing for less fertiliser use and increase yields.
Patent applications have been lodged in New Zealand, Australia and Malaysia, and Balasingham aims to get patents in as many other countries as possible.
He hopes to sell production licences globally and says he's had interest from a major bio-pesticide maker wanting to form an alliance.
Trials during 2005-06 with New Zealand apple growers delivered positive results, he says, and for the 2006-07 season he's sold more than 1000 litres worth to merchants and companies.
Those sales have been worth around $80,000 but Balasingham says that, if he can succeed in getting Agrizest used on an eighth of NZ crops, annual sales here could be worth more than $5 million.
Agresearch
AgResearch has finally clarified the source of information that led to a somewhat dramatic headline in its January Now magazine suggesting our $6 billion export dairy industry could be at risk if the European Union insists on pathogen-free milk and dairy products.
That was despite dairy exports to the EU only being worth about $450 million in the year to last November.
It turns out the article drew on a 2004 report published by the Animal Health Board and the Department of Conservation on the use of 1080 poison to kill off possums, which spread tuberculosis to cattle and deer. It referred to a 1990 EU proposal for milk and milk products to be certified free of pathogens, including Tb.
The report noted the EU didn't go ahead with the plan all those years ago but suggested the issue was an indication of the direction some importing countries could head, and highlighted the need to clear Tb from dairy herds.
AgResearch's general manager (applied biotechnologies) Jimmy Suttie says there's been no recent indication the EU will change its rules and require pathogen-free milk. But, while it is unlikely the issue will be of concern in the immediate future, he also feels it would be unwise to completely discount the possibility.
He says AgResearch will keep searching for a vaccine for bovine Tb, for animal and human health reasons, and for better agricultural productivity.
That's all some way short of justifying the in-your-face $6 billion warning - but it's good to see AgResearch is on the case.
Deer Development
A survey of deer farmers has confirmed support for a new organisation to oversee sales and marketing of velvet in a bid to boost export returns.
Currently, PGG Wrightson runs a pooling system which auctions velvet directly to the highest bidder.
But Stu Nattrass - a member of the industry's Velconz initiative working party - says the survey indicates most farmers are keen to move away from having their velvet handled by the auction system.
The working party plans to discuss the results with PGG Wrightson to find a way forward.
He said the working party preferred to have farmer ownership of the new organisation, with PGG Wrightson providing services.
The push for change followed a significant decrease in annual returns from velvet between 2001 and 2005, despite an increase in production.
LIC's Irish deal
Hamilton-based LIC (the former Livestock Improvement) is planning to merge its Irish subsidiary NZ Genetics (Ireland) with Irish artificial insemination company Eurogene AiServices.
The aim of the merger is to provide a stronger artificial insemination (AI) service to the Irish dairy industry from spring this year. The new company will be known as Eurogene AiServices (Ireland) and will combine the sales and administration teams of both companies with Eurogene's AI technician service. LIC will be Eurogene AiServices' second largest shareholder.
LIC said the deal didn't involve either party paying the other cash.
LIC said its dairy genetics, proven on grass, had been popular with Irish farmers but its operations in Ireland had been hampered by its technical services infrastructure.
Merging with Eurogene means the combined operation could offer a "comprehensive" genetics offering backed-up by Eurogene's technician service.
