Episode Transcript
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Speaker 1 (00:00):
Tears a bloke I always enjoy catching up with at
field Days because I enjoy this company. But perhaps more importantly,
Mark de Latour, chief executive of Open Country Cheese, you
give me a block of cheese. There would only be
one thing better than be given a block of cheese
at field Days, and that would be to be given
a block of butter.
Speaker 2 (00:20):
Good afternoon, Jamie, Well well played, well played there. We're
just going to miss the field days this year with
our butter plant will be sort of turning that on
around August, but certainly our supplies we'll get their allocation
of butter, just like the cheese, and I see with
butter prices in New Zealand like it is now that
(00:41):
that timing is going to be perfect.
Speaker 1 (00:42):
Let's get back before field Days to what's going to
happen tonight. We've got a Global Dairy Trade auction, our
final one for this dairy season. I put it to
you that we can't keep defying gravity. There must be
a leveling off or a drop in the GDT or
am I just being a bit pessimistic there.
Speaker 2 (01:02):
I think you're right, Jane, iving you know, leveling off
would be would probably be good. I think most people
would be quite happy without. What we don't want is
a correction. Right now, there's nothing in the market to
suggest a correction, so I'm not jumping at shadows, but
you know, I think at these sort of levels, everyone
does get a little bit nervous and saying, let's let's
(01:23):
hold onto this. So our forecast is a slight decline
for the for the for the next few months. But
we still got to our first two periods of the
new season, you know, right up there towards mid ten
dollars forecast. So I don't think it's going to be
going to do anything drastic, but you know, it is
likely we'll see some softening in the next few months.
Speaker 1 (01:45):
Unlike Fonterra, who pays a season wide average, you guys
split your payments into four seasons, or into four segments.
The midpoint on period four, and that is February through
to May, is a whopper ten dollars and seventy cents,
which is wonderful. But when you average that out across
your payments for p one, two and three, what's the
(02:08):
season average for open country compared to Fonterra. If Fonterra
indeed meets its ten dollars forecast.
Speaker 2 (02:15):
Yeah, I think across our milk pool, Jamie, you've you've
caught me, but I think it's around about ten oh
seven if we hit that midpoint for the period four
at ten seventy, and I'm sure we'll do that, so
I think it'll be around that ten oh seven. Noting that, Jamie,
there are a lot of differences for each farm. Each
(02:36):
individual farm has its own milk curve and regionally when
they start milking and finished milking. Obviously Southland's work out
every every farm slightly different because of that timing. But
across the miwpool, I think it's about ten o seven.
Speaker 1 (02:51):
Are you surprised that the milk volumes have increased year
on year, bearing in mind how dry it was in
parts and key parts of the North Isle dairy regions
Whai Kato, Taramaki.
Speaker 2 (03:02):
Yeah, absolutely, And of course Southland had a terrible start,
you know, with the spring with the flooding, so you
know that they've been chasing their tail all the years
down south and I'm actually talking to you from in Vocago, Jamie,
so and just with the team down here and Southland
at the stage of this late part of the season
is actually three now three percent up year on year
(03:24):
for us, so they had a tough start, but they
have had a really good finish to the season. Waikato
want to know, both of them around four to five
percent up year. But I guess even with the dry weather, Jamie,
when the milk price is strong, farmers can afford to
feed out and support that. So everyone's been chasing good
(03:45):
volumes for these prices.
Speaker 1 (03:46):
Now the pearol south and farmer's got a real kicking
in the spring period, worse spring on record, but the
payback has been Mother nature has been pretty kind in
the autumn. And of course because of the way you
split your payments further south you are the probably the
better you fare at open country in a year where
the prices continue to go up throughout the season like
(04:08):
this season.
Speaker 2 (04:09):
Yeah, that's right, I mean, that's just the way it is.
I mean, we do offer a couple of different payment models,
so people can choose to go with a curve very
similar to fonterras if they want, but or you can
go with the full payment model. So we do give
lots of choice even when you're when you're a supplier,
so people can change from season to season on their
(04:31):
payment system. But yep, for that's right. What I will say, Jamie, is,
of course this next milk season is going to start
it at a strong number, so you know, the curve
might look quite different. So very much a case of
horses for courses for each farmer, and we sit down
with each of those farmers and work out what probably
is going to work best for them.
Speaker 1 (04:52):
One more to throw at you, and that is to
be fair to you. I think it was you and
Cameron Bagriy both flew this kite at about same time.
The prospect of more dairy conversions in the coming season,
is it going to come to fruition?
Speaker 2 (05:06):
Yeah, I'm certain of. I mean, the country needs it, Jamie.
Let's be honest. We've got to do more of what
we're good at. So you know, I guess capitalists and
environmentalists alike have to acknowledge that milk out of New
Zealand is the most efficient food product around in the
(05:27):
world right now. So we need more money for our
country's balance sheet, and certainly the world needs more low
carbon efficient milk so that we naturally do that. We
don't need to change anything. We naturally do that. So
let's take advantage of it, so especially you know the
guys down here in Southland, with their scale and efficiency,
(05:49):
they do a great job. So it's been good to
spend a couple of days with some farmers down here.
Speaker 1 (05:52):
Mark de Latour, you enjoy the rest of your day
in God's own farming province. I'll see you at field Days.
Speaker 2 (05:58):
Thanks very much, Jamie. Just a quick shout out to
the team down here, Jami if I can. We've got
Miles Herdman who most of the people down in the
South and here will know. Miles. He's one of the originals.
We call him the Originals. I think he's employee number
three for Open Country and he's retiring at the end
of this month. So we're down here. We've got Cody
(06:19):
and Melissa who have joined the team for the last
six months and there they're going to take over from Miles,
who's very much enjoying the fact that two people are
going to take over where he left off. So that's
just a quick shout out to Miles to say, yeah,
thank you for everything he's done for Open Country and
also the industry down here in south.
Speaker 1 (06:38):
Yeap bit of a legend. Good on you, Thanks for
your time, see you it Field.
Speaker 2 (06:41):
Nice Jetta,