Technical Papers - 1997
1997
97/1 Bibliography of MAF Policy publications: 1993 to 1996
Rod Forbes May 1997
97/2 A review of sharemilking: 1972 to 1996
Geoffrey Taylor September 1996
Sharemilking in the New Zealand dairy industry refers to a farm owner on the one hand and a sharemilker on the other (who owns the cattle). Normally operating under 50/50 profit-sharing, this arrangement allows the farm owner to discontinue the task of milking (while retaining a reasonable income and a modest return on investment), and the sharemilker - who undertakes the labour - to build financial capital towards their own financial goals, develop business/farming skills, and to enjoy a farming lifestyle. Long-term trends in this industry examined through farm owner questionnaires. Sharemilking is being affected by rising land prices, a rising cost structure, and shrinking product prices in real terms; leading to shrinking returns for owners and a move towards fewer but larger farms. However, the medium-term future of 50/50 sharemilking looks assured, mainly because owners simply do not wish to milk cows until they retire. The 50/50 arrangement seems to be changing in a way that favours owners. The biggest issue for sharemilkers is the increasing divergence between sharemilker's cattle values (which is the equity they need to buy their own farms), and increasing land values and larger farm sizes.
97/3 Impacts of land use change in Wairoa District: resource document
M K Krause and J M King April 1997
Converting hill country pastoral farming to plantation forestry is happening a lot in New Zealand. This study (in four sections) looks at how conversion impacts on employment and household income. Section one introduces the Wairoa District (e.g., land use, industry etc.); section two details some of the recent land-use and commercial changes that have occurred in the area; and the next section deals with some of the impacts of these changes (e.g., to farming and meat processing, and to the social structure and to the environment). Section four discusses the opportunities that could arise from land-use changes. The key point is that local communities must take charge of its own destiny. To hide from changes will often mean that opportunities will be lost, and captured by others elsewhere. Above all, people's attitudes must change to one of being positive, forward looking and confident. Building a positive attitude is one of the greatest challenges and prerequisites to successful social and economic change facing communities.
97/4a Issues of New Zealand Farm Succession: A Study of the Intergenerational Transfer of the Farm Business
Heather McCrostie Little and Nick Taylor June 1998
Family farming has long been the cornerstone of the NZ agricultural system, and if this to persist then farm transfer from one generation to the next must be capable of accommodating the needs of all the family members. This study looked at issues such as: the role and status of family members in the farm business structure; its ownership, management and decision-making; the level of family consultation and communication during the succession process; where stress occurs in the process; and how the succeeding generation enters into positions of ownership and management as the retiring generation exits. Thirty interviews were conducted with retiring couples, succeeding couples, and single male successors. This was followed by focus group meetings. Crucial to successful succession is: open communication between the generations; an early start for retirement and succession planning; and all parties have to be open to ideas, flexible adaptable, and able to exercise options. Succession runs relatively smoothly in families with a history of between-generation transfer, in families that appreciate the need for planning and management, and in financially secure farms. Stress is greatest for the succeeding generation at the start of the process; stress for the retiring generation occurs at each stage of the process. Although a still male-dominated process, the role of women in the process is changing. business operation facing ultimate sale.
97/5 Off-Farm Income: Theory and Practice
Irene Parminter June 1997
This study uses an economic model and seven case-study farms to project likely future changes in the importance of off-farm income, and the implications of these changes. Off-farm income is likely to be increasingly important. Off-farm employment is likely to increase in more densely populated rural areas and in districts within commuting distance of urban areas. This reflects the wider picture of a long-term decline in product prices and labour-saving technological change in agricultural production. Most farmers will work off-farm in order to retain ownership of their farm. Economically speaking, there seem to be few clear and unambiguous relationships between off-farm work and the long-term productivity and profitability of farms. However, much depends on farmer attitudes. In one instance, off-farm employment was viewed by the farmer as an admission of failure; in other cases, working off-farm is seen as one part of a success story which achieves personal and family goals.
97/6 Land Use and Community in Southland Region
Dr Ruth M. Houghton, Dr Alan King and Ms Rachel K. Piper
June 1996
Using published sources, and focusing on three small rural communities, a range of information was assembled and reviewed, that can serve as a background for further research into the processes of community impacts and responses to land use change. The report itself has the following key sections: Regional Agricultural Economy (current structure and recent trends); land use industries (farming and forestry); Population and Employment; and Rural Community Profiles (detailing how these communities have responded to the changes facing them). Land use changes resulting from a move from pastoral farming to forestry and dairying were significant social forces, resulting in changed employment activities and ownership structures. In addition, the region's population is generally ageing. A series of questions was developed from the information gathered, including: is there a critical mass in population size and demography to sustain communities as well as the region; how do small, local businesses adapt over time to changes in economic activity, employment, and population; and how have communities responded to new residents who have entered the region as a result of the increasing popularity of dairying?
97/7a Entrepreneurship in New Zealand Farming: A Study of Alternative Enterprises on Farms
Nick Taylor and Heather McCrostie Little. June 1997
Little information is available on non-farming activities undertaken to augment the income of NZ farming families (either as off-farm employment or on-farm alternative enterprises). This report (one of a series of related publications) analysed these non-agricultural enterprises. Sixty farmers with alternative income sources were interviewed in-depth. Reasons for moving towards alternative enterprises include: the agricultural restructuring of the 1980s, changes in the status and economic activity of women, and the high level of tertiary education amongst farmers who went in for alternative enterprises. Young farmers building their ownership and equity are often involved in off-farm employment, whereas 'enterprise farmers' tended to be well into their life cycles, with well-developed properties. Recommendations for a social monitoring framework for household farm income are presented. Other issues highlighted include: 'red tape' as a barrier to enterprise creation, health & safety legislation, local business and employment initiatives (which tend to targeted towards rural towns more than towards farms themselves), and the need for a co-ordinated approach to rural tourism.
97/8
The Development of Agricultural Advisory Services in New Zealand
Phil Journeaux and Pat Stevens June 1997
Currently, advisory services are offered to New Zealand farmers on a fee-paying basis by Agriculture New Zealand (a branch of a private company), by marketing boards on a product by product basis, and by individual agents who contract out their services (with the interface between these services and the government being MAF Technical Policy). However, the history of these services can be traced as far back as 1892. Most of this history has been based on the assumption that if the government did not provide these services then they would be under-provided. So the State assumed responsibility for funding and delivery very early on. Unlike other countries, both universities and the private sector were excluded from this system. A very successful model developed, yet its very success led to a complete change in philosophy and practice. Changes began in 1985, when the government of the day directed the Advisory Services Division of MAF to become fully user-pays within 5 years. In 1987, MAF's Advisory Services Division and its Research Division amalgamated to form MAF Technology. In 1990, the renamed Management Consulting Service was reformed as a separate national business, but still within MAF. Full privatisation then occurred in 1995 (when it was sold to become Agriculture New Zealand).
97/9 Impacts of Dairy Conversions in the Taupo District
Agriculture New Zealand, Woodward Clyde Ltd, Geoff Butcher & Associates - August
1997
This study investigated the economic, social and environmental implications of large-scale dairy conversions in the Taupo region (chosen because of the scale of conversions that have taken place, and because water quality is important to the region's major industry - tourism). Thirty farms (half sheep & beef, and half dairy) were surveyed and monitored, and consultation occurred with groups like local iwi, Environment Waikato, Taupo District Council, stock firms etc. Converting 6,400 hectares in land to dairy farming has created $14.5 million extra total output, $5.25 million in extra value added, $2.3 million extra household income, and 112 extra jobs. There are large differences in fertiliser practices of sheep and beef farmers, and dairy farmers. Given the high rate of nutrient input via fertilisers and effluent, dairy's major potential environmental impact is probably nutrient leaching into the ground water and nutrient run-off to surface waters. Because of the national and international significance of Lake Taupo (compared to the small national contribution to dairy production that the area makes), serious consideration must be given to increased monitoring and modelling of impacts, and a pro-active stance of land owner education/advice to mitigate or avoid adverse impacts is needed.
97/10 The Viability of Small Dairy Farms
Allen, J.
This study aimed to: describe the financial profile of a typical 40ha Waikato dairy farm, sketch possible future scenarios these farmers might be facing (and options for dealing with these scenarios), and the implications for the industry as a whole. Basic financial modelling was used, as well as focus and discussion groups and individual interviews (when determining farmer options). There is a wider rage in herd size than in the past, but the national average herd size has increased from 112 (1972) to 199 (1996). About 14% of suppliers run less than the average herd size (100 cows). Those 40 ha owner/operators with above average management skills and a low level of debt are likely to be making a disposable cash surplus; those with average or below average management skills are unlikely to be making a surplus (the same applies to above average operators with high debt loadings). Options for farmers not producing a surplus (e.g., selling up, changing the farm's management ownership structure, and alternative land uses) are discussed. An individuals financial situation will be the prime determinant of what option can be chosen. If some of these farmers leave the land, it is thought there will be minimal impact on the industry as a whole.
97/11 Change and Diversity: Opportunities for and Contraints on Rural Women in New Zealand
Mary-Jane Rivers, Ann Pomeroy, Dianne Buchan, Brian Pomeroy and Rachel Fogarty.
October 1997
This report looks at how recent developments in technology, economic opportunity and social values have modified the lives of rural women. Data came from a literature search, written questionnaires (n = 250), telephone and face-to-face interviews, and focus group interviews. Women have more opportunities (e.g., for developing businesses). But, life has become more stressful as women have to balance multiple roles (domestic and family roles, farm and farm management roles, and business/off-farm employment roles). Increased opportunities have meant that women have increased financial clout in rural areas (a clout often unacknowledged in some areas, for example, by some service providers such as accountants, lawyers etc.). Recommendations include: the need for a wider acknowledgement of women's social and economic contribution, making childcare more available, supporting the appointment of women to formal decision making bodies, and changing attitudes of some of the rural press to better reflect the reality of life for rural women.
97/12 Transferable Water Permits:Two Case Studies of the Issues
Mike Kearney and Jim Sinner. December 1997
NZ has little practical experience in using economic instruments like transferable permits under the Resource Management Act. The two case studies in this project looked at: identifying barriers to putting in place the Manawatu-Wanganui Regional Council's Oroua Catchment Water Allocation & River Flows Plan; and (in the Tasman Region) understanding and documenting a community's views on the concept of Transferable Water Permits - TWPs - as an option for water management. A TWP is a resource consent to take water (i.e., a water allocation) which can be transferred from one place within the water resource (e.g., an aquifer) to another place in the same water resource. Issues arising can be grouped into: understanding the concept of TWPs, and how they operate in practice. Regarding the former, there is a lack of understanding amongst water users about the shortcomings of the current system, and how TWPs can be a way of dealing with these problems. This highlights the importance of involving water users in the whole process, including policy development (because the success or otherwise of TWPs depends on community perceptions). Operational issues also arise, for example, irrigation users worry that they could irreversibly lose their permits to urban/industrial users. Other concerns include those relating to how permits are allocated, traded and monitored.
97/13 Organic Farming in New Zealand: An Evaluation of the Current and Future Prospects including an Assessement of Research Needs
Caroline Saunders, Jon Manhire, Hugh Campbell and John Fairweather. October 1997
This study aimed to: determine the potential for organic farming (through a literature review); evaluate the current research investment and identify future research investment needs (through focus group interviews and a review of NZ research); and analyse the factors determining the adoption rate of organic farming methods. For organic farming, potential exists for NZ to continue targeting niche markets, especially in Japan and the US. Identified research priorities include Production research (e.g., breeding natural plant resistance, biological control of pests and diseases, and comparative benefits of organic vs 'conventional farming); Market research (defining consumer perceptions in potential overseas markets); and Infrastructure research (e.g., assisting BIOGRO develop effective standards). Key factors influencing growers adopting organic farming techniques include: financial premiums, mind-set change, demonstrations of success, and lack of research.
97/14 Organic Farming in New Zealand: An Evaluation of the Current and Future Prospects including an Assessement of Research Needs -
Caroline Saunders, Jon Manhire, Hugh Campbell and John Fairweather. October 1997
Precis of 97/13
97/15
REAPs: Making a Difference in Rural Education
Diane Anderson. July 1997
Rural people are concerned about their access to educational services. This report, the third in a series (also see MAF Policy Technical Papers 93/8, 94/15), explores the effectiveness of Rural Education Activities Programmes (REAPs) in: early childhood education, primary and secondary education, adult & community education, and Maori education. Published information, discussions, a questionnaire sent to REAPs, and a facilitated discussion at the 1997 REAP Annual Conference was used to collect information. Indicators were identified that could help assess the effectiveness in REAPs. Evidence suggests the REAP model is a cost-effective means of providing many people in small rural communities with a valuable service. One of REAP's strengths has been its ability to respond rapidly to the changing needs of local communities (because REAPs are small and flexible).
97/16
Meat, Meat eating and Vegetarianism: A Review of the Facts
Professor Neville G Gregory.October 1997
A downward trend in meat exports is related to the move towards vegetarianism and semi-vegetarianism in our major export markets. This study examines the images of meat, customer attitudes to meat, key factors which may lead to reduced meat eating, and the attitudes and beliefs of various types of vegetarianism. Vegetarianism is traced from the 1960s (when it was embraced mainly because of spiritual, devotional and ecological attitudes) to the 1990s (when concerns about animal welfare predominate). The report contends that the main threat to the meat industry is from reduced meat eating and semi-vegetarianism in the rest of the population. Thus, the meat industry needs to address the concerns that lead to people choosing reduced meat eating, by: improving the image of the meat and the livestock industry; and countering the vegetarian
97/18 Citizens Advice Bureaux And Rural Service Needs
NZ Association of Citizens Advice Bureaux. June 1997
This report examines the nature of enquiries to rural Citizens Advice Bureaux (CAB); and analyses the various patterns found. CAB statistics show different patterns of demand for information, advice and support between rural and urban bureaux (patterns may also vary over time). Rural CABs have fewer enquiries in relation to their population than urban CABs, but rural bureaux have a higher proportion of enquiries for financial/budgeting, health/welfare and general information. From 1990/91 to 1995/96 enquiries on consumer matters nearly doubled as a proportion of rural enquiries; and over the same period, the total number of rural enquiries increased by 50% (whereas urban enquiries only increased by 25%). This shows that the social and economic environments are different in the two areas, and that services provided to rural communities should reflect this. Concerns were raised about the decreased opportunities for rural people to have face-to-face services from a range of government departments and organisations.
97/19 Farm Families and Sustainability in the mid Rangitikei
Marg Gilling. October 1997
Since the 1980s fundamental economic changes have lead to fundamental changes in the values, beliefs and norms of farming families. This project looked at their living standards, relationships with local communities, and problems, issues and strengths that characterise farming families and their communities. Data were obtained through interviews and public meetings. Farming families were found to be feeling uncertain, threatened and unable to plan for the future (and were unable to give active consideration to sustainability). In addition, families are facing changes in other areas, including: family dynamics and roles, and issues and practices to do with succession. The report makes recommendations about the support mechanisms needed by farming families.
97/20 Managing Social Transformation in Rural New Zealand
Proceedings of UNESCO/MAF Seminar. October 1997
Results from a UNESCO/MAF seminar looking at the situation in rural NZ (which is characterised by increased diversity in how land is used and an unevenness of development in different areas). Group discussions noted a decline in some rural areas. In others, though, something of a 'rural Renaissance' is occurring (mainly due to the increased diversification taking place within agriculture itself, the increasing number of non-agricultural uses of agricultural land, and the wider range of people now living in rural areas). Continuing challenges in rural areas include: realising the potential of women and Maori, retaining young people, and improving delivery and co-ordination of services from central government. The reports ends by considering how changes within rural communities will have impact on government policies and the delivery of services.
97/21
"Unpaid" Farm Work " - a scoping
study
Heather McCrostie Little, Nick Taylor & Wayne McClintock. November 1997
Major changes within labour on NZ farms are occurring, due to: changes in household and farm technology, the tight financial position of many farms, and the increased emphasis on maintaining a competitive advantage in international markets. This study provides a picture of labour input into the family farm business, explores the relationship between farm family members and the extended family, and studies how the involvement of extended family through unwaged work contributes to farm viability and sustainability in social as well as economic terms. Research was based on a literature review and face-to-face interviews. Key findings include: the farm household is the primary source of labour on family farms; ownership structures for farms are steadily evolving into partnership arrangements; gender-based differences, nonetheless, still exist; there are now fewer full- and part-time paid, non-family employees; there is more employment of contract and casual labour; household roles increasingly reflect generational attitudes; and family relationships in farm families remain strong.
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