2026 Nuffield NZ Farming Scholarship. Apply by 17 August 2025. Read More...

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kellogg

Blackroom: A concept incubator for the future of coarse wool.

Executive summary

The coarse wool industry has been described as being in a state of malaise by the existing literature and industry experts. Back in 1981 Prime Minister David Lange infamously boasted that agriculture was a sunset industry (Federated Farmers, 2014). At the time this was challenged by industry sector leaders as being false. However, whilst undertaking an analysis of the coarse wool, the research has indicated the industry has passed through the ‘sunset phase’ and now is in the ‘decline’ phase and may be irretrievable, unless major changes occur. 

The primary reason for this research is to investigate the future for coarse wool. Wool is a hugely under rated product that has so many positive, environmentally conscientious and natural benefits that are being over-looked in favour of synthetic alternatives.

The report continues on from the previously titled “The New Zealand Coarse Wool Industry – Does it have a Future?” (Oliver, 2015). As reiterated in the prior report, the only way forward now for the industry in the expert’s opinion, is for the industry to commit itself seriously to advanced research to take the coarse wool fibre into new uses. This report outlines the potential of using a foresighting, backcasting concept incubator, named ‘Blackroom’.

The key to the utilization of a Blackroom futures concept is to takes the researchers away from the present and places them in the distant future, envisaging the future system state and then bringing it all back in order to determine the pathway to the future product use. The resulting outcome of the Blackroom will be to develop new research pathways for the future of the wool fibre and industry.

Nicole Oliver

Bobby calves: The game changers within New Zealand’s supply chain.

Executive summary

There is significant potential for New Zealand to increase its ability to utilise more bobby calves therefore making them a more valued product. It is important that we have a sustainable, viable, ethical and PR friendly value chain. It is also important that NZ Inc. gets this right to maintain farmers/producers’ ‘social licence’ to farm and maintain our positive worldwide perception.
While difficult to calculate, it is estimated that more than $1 billion is on offer, if we can capture the full value of underutilised bobby calves.

It is acknowledged that famers all operate different policies with different values, so it is near impossible to make a recommendation that will suit all producers and fit with processors’ expectations and resources. There is a range of options which will lead to more prosperous returns for the farmers, processors and overall sector. However, more leadership is needed to make these changes at all points of the industry supply chain.
Key recommendations:

  • Increased use of beef genetics across dairy herds
  • Increased use of sexed semen across dairy herds
  • An integrated dairy beef “profit partnership” supply chain model, where everyonecaptures the value of the end product
  • Uptake of a tool which measures beef performance through the supply chain toallow a feedback loop
  • Increased farmer education on what options are available

Dairy farmers are at the start of the value chain, so it is critical that those options are easy for them and do not affect their primary objective, which is producing milk at the highest margin possible.
In implementing any of the above options, it is expected that sacrifices would have to be made and some options do not benefit everyone in the supply chain.

Andrew Jolly

Primary connections: Leadership pathways within rural organisations.

Executive summary

A Professionalism shortage in governance, more and more organisations are beginning to expect more professionalism, from potential candidates. Although this might be the case there may not have been enough done to clarify and support the transformation. Every year thousands of people volunteer their time in leadership roles throughout the primary industry, yet there is no cross industry information to provide a pathway for these individuals to allow them to take their next step in governance and leadership

This feasibility study and research asks the question:


“Where do you go find the relevant information to get involved in the various governance roles in the volunteer based rural organisations?”

My project looks at the feasibility of a website concept that rural industry good/Non-profit organisations can use as a platform to promote the leadership pathways available within the organisation that shows short job descriptions and information on how to get involved from an entry level to high level of governance.

A one stop shop website of information on what is available to the up & coming leaders of tomorrow wanting to make a difference in the rural communities of New Zealand.
The areas of research to complete this paper have used the following methods

  1. A Literature review, to gain understanding of current used of leadership pathways and opportunities
  2. An online survey promoted via Facebook and email targeting people involved in the primary industries tounderstand their method of finding information relevant to my question.
  3. Case Study interviews that were held face to face and via email and phone, to gain an understanding howthese particular organisations promote their leadership pathways currently.

A key finding through the process of the online survey and case study interviews, found that the primary industries in the Non-profit and Industry good sector, who may rely on governance structures and people coming through to fill these roles. Haven’t consider the role that the internet and Social media can play to advertise and show the leadership opportunities to the future leaders looking for their next step in the governance ladder. And so could be missing the opportunity to engage this particular generation which we call the “Millennials”.

By having clear and concise information in which the “Millennials” (Researchers Neil Howe and William Strauss defined as those born in 1982 and approximately the 20 years thereafter) crave, to collectively to tell these Future leaders the opportunities available. We can look to change the way we engage and fill these vitally important positions on the various rural governance groups in New Zealand.

Preparing for the changing tide.

Executive summary

The regional council of Southland (Environment Southland) is mid-way through its Water and Land 2020 and Beyond (WL2020) Project. This project consists of three stages, and is the council’s response to the government’s National Policy Statement for Freshwater Management. It aims to prevent any further decline in water quality, and to help the Southland community achieve its goals for water.
Dairy farming has increased significantly in Southland over the previous 20 years, and is now a substantial contributor to the Southland economy. With this intensification, has come water quality pressures. The changing environmental regulations of the WL2020 project will impact Southland dairy farmers, as well as the Southland community.

The aim of this project was to investigate how Southland dairy farmers had been involved in the WL2020 process so far, and how to increase this involvement. From this, the aim was to find ways in which DairyNZ, the industry levy body, can support Southland dairy farmers to adapt to changing environmental regulations. Thirteen people, a mixture of industry members and Southland dairy farmers, who have been very involved with the WL2020 process so far, were interviewed.
It was found that engagement by dairy farmers in the WL2020 project was between 10 and 20%. This low engagement restricted the majority of dairy farmers from being able to have knowledge of the proposed rules and changes of the WL2020 project, the impacts of these and from being prepared for these impacts.

Five broad recommendations were made that would contribute to Southland dairy farmers and their communities adapting to the changing environmental regulations:

  1. Water quality is a social science issue as well as a science issue – dairy farmers must understand the water quality issue, accept that there is an issue and understand the effect of their actions on it.
  2. DairyNZ should continue what it is doing in Southland but build on this – the work of DairyNZ in Southland is effective and appreciated. There were some recommendations for building on this, but overall DairyNZ is on the right track.
  3. Engagement is the first step – dairy farmers needed to be engaged before they could have knowledge of the proposed changes, their impacts and adapt to these. Personalising the issues and one-on-one meetings were important in this step.
  4. Sustainable Milk Plans (SMPs) are an effective tool but need a follow up visit – SMPs helped increase the knowledge and preparedness for the proposed rules and changes, but a follow up visit and auditing system would increase their effectiveness.
  5. Relationships and leadership are key – relationships within the community and with ES are important. Dairy farmers must be prepared to show leadership.

It was found that Southland dairy farmers themselves have a responsibility to build relationships in their own community. Although DairyNZ has an important supporting role to play, dairy farmers must be prepared to show leadership. If this occurs, not only will Southland dairy farmers and their communities adapt to the changing environmental regulations, they with thrive within them.

Jolene Germann

Avoiding complacency in kiwifruit biosecurity.

Executive summary

Psa has increased biosecurity awareness in the kiwifruit industry, and is reinforced by recent fruit fly incursions and biosecurity communications by industry bodies. Kiwifruit growers believe that a future biosecurity incursion is a significant risk to their investment in kiwifruit, if not the greatest risk. Yet on most orchards, biosecurity practices have slipped from where they were several years ago.
The aim of this study is to determine if growers are becoming complacent in biosecurity practice over time. If so, how do we overcome this to ensure that the kiwifruit industry is prepared for a future biosecurity incursion?

Interviews were held with kiwifruit growers, post-harvest grower services representatives and biosecurity subject experts to understand grower attitudes to biosecurity practices and why certain practices were no longer being implemented, especially in “Recovery Regions” where Psa had been present the longest. A subject expert from Civil Defence was also interviewed to learn how they overcome complacency when preparing the public for emergencies.

The results of the study indicate that growers in Recovery Regions are retaining those practices seen to make a difference in mitigating the impacts of Psa. Some growers believe the initial protocols implemented for Psa are excessive for the current environment and the decline in practice is not a result of “complacency” but rather a “new norm” appropriate for the current level of risk.
However, this reflects the Psa-centric paradigm of the industry. For most growers thinking about “risk” does not extend beyond Psa at least not in terms of their own on-orchard practices. The role growers can play in mitigating the impact of future biosecurity incursions does not seem to be well understood and is considered the responsibility of organisations such as KVH and MPI.

Most growers believe they are doing what is necessary to manage “risk” (of Psa). However, this falls below what most subject experts would recommend as a minimum standard to reduce the impacts of a future biosecurity incursion. If every grower maintained a baseline of minimum on-orchard practice even in the absence of an imminent threat, the industry would be more likely to limit the spread of a pest or pathogen before it is detected, and for many organisms that could determine whether eradication is a possibility or not. For growers the financial implications of this can be extremely significant. A biosecurity threat that is not eradicated, creates a challenge that needs to be managed year after year. Impacts to the grower may include loss of orchard productivity and land value, increase in operating costs, market access implications and in some cases, all of the above. Biosecurity practices provide the industry with a form of insurance against a significant business risk.

Numerous barriers to implementing best practice are identified in the study including information overload, the cost of implementing practices and commercial disincentives associated with some practices. However, subject experts, from biosecurity or Civil Defence, were unanimous in stating that the single greatest barrier to uptake of recommended practice is a lack of understanding of risk, and how specific measures mitigate this risk. Creating this understanding is a fundamental step in the implementation process, but it is only the first step. Different segments of the industry respond to different cues and require different support through the implementation process which may include; guidance on how to implement the practice, testimony from trusted sources such as their peers or opinion leaders, observation that the practices are effective and feedback to reinforce their decision to implement once they have done so.

Literature and subject experts suggest that to facilitate the necessary behavioural change, the industry should establish a working group of biosecurity champions and opinion leaders. Involvement of this group in the development of biosecurity guidelines will ensure they are practical, fit for purpose and have the support and ownership of the industry from an early stage. Industry champions also provide a respected resource to communicate key messages and provide on-going support to growers. When programme champions play an active role in the development of an innovation, spread and implementation is likely to be more effective.

The study makes the following recommendations for the kiwifruit industry:

  1. Biosecurity awareness material needs to be made “real” for growers, in terms they relate to such as potential impact to orchard productivity, trade, and orchard value.
  2. Industry biosecurity guidelines are required, to indicate the level of practice required for business-as-usual operation in absence of an imminent biosecurity threat or response. These guidelines would provide consistency across the industry, remove commercial disincentives that currently exist, and thereby improve the industry’s ability to withstand a future biosecurity incursion.
  3. Guidelines should clearly explain the purpose of a recommended practice and how this mitigates risk.
  4. Recommended practices should be practical and easy to implement. Industry bodies should facilitate this process.
  5. A network of industry champions and opinion leaders should be created to assist in the development, communication, implementation and on-going support of the biosecurity practices.
  6. Care must be taken when selecting industry champions and opinion leaders to ensure selection of individuals with appropriate influence into a diverse range of industry networks.
  7. There is value in a coordinated approach with other industries and they should be involved in the development of biosecurity guidelines to provide consistent messages across the horticultural sector.

Matt Dyck

How technology is disrupting New Zealand agriculture’s value chain.

Executive summary

It makes sense to look at disruptive technology within agriculture when so many other industries have been disrupted. Music (iTunes, Spotify, Pandora), books (Amazon, Book Depository), travel agents (TripAdvisor), transportation (Uber, Tesla), accommodation (AirBnB), entertainment (Netflix), insurance (Trov), recruitment (LinkedIn) or energy (Flick) have all been affected. What all have in common is a lack of physical infrastructure. None of them own stores, factories, hotels, generation sites or shopping outlets. Instead their infrastructure is digital and their domain ends in .com. 

This project’s literature review, case studies and industry interviews suggest disruption is already alive and well within Agriculture’s value chain. My prediction is that such disruption will only accelerate as new technologies become more open and affordable making it the norm rather than the exception. New Zealand agriculture is not immune, and the message is clear: disrupt your own model before someone else does.

his project’s specific focus is on where I believe the greatest value is being lost between farmer and consumer: the retail space. The space that is closest to the consumer and the one facing the most disruption from new players often founded or funded by Silicon Valley who know plenty about disrupting industries. When you have the CEOs of Salesforce, Twitter or Disney investing in artisan food brands you know your sector is ripe for disruption.

This project’s findings conclude the term “value chain” is an oxymoron. Something is wrong when return on assets for producer or processor is so low compared to the same returns a manufacturer or retailer enjoys. Unless our value chain changes, the fear is more family farms will decline in profitability as input costs rise with an inability to pass those costs on to consumers. Worse is the potential scenario where more New Zealand family farms fall to corporate or overseas capital. New Zealand has a long and rich history of farming and forms part of our national identity. Agriculture underpins our global exports and our rural communities are responsible for producing two thirds of our export receipt dollars.

This project concludes that we will come full circle seeing farmers re-gain marketing control from their large co-operatives by clustering into smaller, micro farmer producer group brands that come in “underneath” (Christensen 2013) in the same way craft beer brands such as Tuatara, Panhead, Emmersons and Garage Project have disrupted and stolen share and margin from large brewery beer brands (who have had no choice but to buy them knowing they can’t beat them).
Every farm will have their own marketing plan realising they can no longer abdicate their marketing responsibility to their processors who will continue to struggle and fragment due to a decline in stock units coupled with overcapacity. Some will adapt by becoming more flexible through accepting smaller, more individualised toll processing contracts to defend throughput and maintain infrastructure.

These smaller, local artisan farmer producer groups, along with existing iwi or corporate farming groups, will collectively pull resources together to promote their unique brand story fuelled by their distinct Terroir whilst enjoying a direct and unimpeded line of sight to a targeted niche of end consumers who are willing to pay a premium for their produce. Consumers will pay more because they value a deep connection to the food they buy and the people and story behind it such as Kaitiakitanga. As Simon Sinek suggests with his Golden Circle Model, these customers are buying the why rather than the what or how. Identifying their big why, or noble purpose, will be vital for these farming groups to tell compelling and differentiated brand stories to justify higher prices.

This more direct model will create additional value through capturing efficiencies that come from shorter and more disintermediated value chains. These farmer groups will use established technology and social media platforms to regularly communicate and connect with their customers in a way they never could before creating raving fans of their produce. These brand ambassadors will share their experiences online amplifying product visibility – good and bad.

Despite the common notion that smaller family-owned farms are a declining species, this report challenges that theory and predicts small will be cool in the face of an increasing distrust of big, industrialised food companies by a new generation of more discerning caring consumers who have a healthy preference for quality over quantity.

On the basis of the findings in this report, small and local craft farming brands focussed on their distinct terroir and artisan produce will become the new norm and those farming groups that move first will enjoy the spoils most.

St John Craner

Search for the sweet spot in the New Zealand dairy industry.

Executive summary

The dairy industry is in a difficult period and faced with volatile global milk price, increased farm debt and an increasing level of compliance and regulatory costs. The industry is entering its second consecutive year of negative cash flows. The industry’s biggest processor, Fonterra’s current farm gate milk price of $3.90/kgMS, which is well below the break-even $5.25/kgMS needed according to researchers from DairyNZ. We are starting to see the combined impact of all of these factors reflected in a decline in farm sales and a fall in land values in parts of the country. The pressure has added urgency to the need for realignment in some farming systems and operating cost structures. 

The qualitative study reported here explores the idea of a sweet spot in the dairy industry. This is the point where the operational cost of production (in this case farm working expenses per kilogram of milk solid produced) has the flexibility to mitigate downside risk and capture upside risk in a sustainable farming system. The study examines whether in fact the sweet spot exists, if so where is it and how can it be found? The sweet spot has a direct relationship with the concept of buffer capacity. This term, used to describe resilience in an ecological sense, is applied in a surrogate form to the New Zealand dairy as financial efficiency (Shadbolt, 2013).

Through interviewing Taranaki farmers, rural bankers, farm consultants and farm accountants, I was able to compare and contrast the different views surrounding the sweet spot in the region. I reviewed current literature on the industry’s competitive advantage strategies, analysis of resilient farming systems and an analysis of the five dairy production systems. The data sets were then analyzed and results are discussed in this report.

Dale Cook

Thinking small: what are the opportunities & challenges for a small farming business by adopting a niche marketing approach.

Executive summary

Many agribusiness leaders see New Zealand as going through a transformational phase in agriculture. There is a lot of rhetoric about how best to solve the commodity cycle conundrum we find ourselves in. This ‘cycle conundrum’ is not new to New Zealand as we have been commodity price takers for decades and there are plenty of businesses that have done well out of this. What has changed over the past 5 years is simply the volatility in those markets which has meant less certainty for all who sit along the value chain, from marketer to farmer. There are plenty of industry leaders who talk about the need to add value, to tell our story better, to push the provenance of our products, think about our brands and to understand our customers better. 

This research sought to find out what opportunities and challenges there were to small farming businesses if they were to adopt a niche marketing approach. When I looked at the world from a farmer’s perspective I asked myself ‘what can an individual farmer do to add value to their products when they sell them along a value chain and essentially have to take the price they are offered by their stock agent/wool buyer/account manager?’ I wondered how the ‘little guy’ in this world of selling commodities could really make some cold hard cash and add value to their business. By digging a bit deeper it became apparent that there is a range of farmers in New Zealand who have also potentially posed that same question to themselves and their businesses and have ended up doing something about it.

A review of the literature helped guide my thinking around niche marketing in general and then how agriculture fitted into this. I then interviewed six farming businesses, five of which were small family owned and operated. Out of this research a number of themes emerged namely that there were three key factors that were a catalyst in small farming businesses choosing to adopt a niche marketing approach (financial, environmental and emotional). Other themes were based around the lack of resourcing and support available, the financial considerations in creating a differentiated product and that all businesses (with the exception of one) had at least one extravert (sometimes two) helping drive the business.

With some experts from around New Zealand offering their advice about niche/diversified markets, the discussion centred on the opportunities for farmers to really start thinking about what customers need and want before launching into adopting a niche approach. Some of the key requirements were discussed including relationship building, understanding the marketing mix, utilising regulation as an advantage and design thinking. There are challenges in going down a niche marketing route and these were discussed with respect to resources and investment requirements. All of the farming businesses interviewed showed courage and leadership in developing their niche businesses which I believe is a vital component to success.

The recommendation for farmers who want to explore whether a niche marketing approach is the right thing for their business is to first consider some key challenges that they may face. Some of these challenges include what investment is required (both time and financial), whether the people who are going to help drive the business forward have the ability to handle risk and where they are going to look in order to find sound advice and support.

Upon completion of this report, I came up with more questions than answers! This area is not well researched and I believe there is huge opportunity for more in-depth analysis of small farming businesses that have adopted a niche marketing approach.

Natalie Bowie

Effective family succession planning and governance.

Executive summary

The underlying motivation behind undertaking this research is to identify some of the key processes and initiatives that successful New Zealand family businesses implement to ensure their successes and human capital are passed down through the generations effectively. Conversely, I was also interested in clearly identifying some of the common issues which arise in family succession plans and ways in which these issues may be avoided. 

This topic is important to me having lost my father in 2012, and being the oldest child, I feel a certain level of responsibility to provide leadership within our family in the hope that our family business continues to prosper in a sustainable and risk averse manner. My long-term vision is an ‘intergenerational family business’ which creates employment and investment opportunities within our family and the next generation to come.

Initially, the context in which I planned to undertake my research was more in a broad sense focusing on family owned businesses across the primary sector. As my research progressed, I decided to narrow my focus and apply my topic to family businesses involved within the kiwifruit industry.

My hope for this research, is that it will provide some benefit to other industry families and encourage them to ‘think bigger’ and openly communicate around succession planning. I hope that this research will also provide some framework around how to govern a family business effectively and that it will benefit family businesses for the better.

We live amongst an increasingly busy world, and I am therefore mindful that people, including myself are becoming increasingly time constrained. For this reason, I have chosen to prepare my report more concisely than recommended in the project guidelines focusing on the salient points of my research. By taking this approach, I hope that it will encourage more people read this report.

The thing I enjoyed most about compiling this research paper was the opportunity to sit down one on one, face to face with some highly successful key industry participants who openly spoke about their family owned businesses. They each willingly shared with me the challenges they had faced along the way, mistakes they had made and what they had learnt from them. These are people who have walked the walk, and their knowledge and shared experiences in my opinion, is significantly more valuable than any other information source available. I found this part of my research to be highly inspiring, and reiterated to me how great the kiwifruit industry is and what a privilege it is to be a part of it. Effective leadership highly revolves around people, and it became obvious to me that the success of the kiwifruit industry is a result of great leadership from key industry personnel, some of which I have been fortunate enough to engage with.

The issue of succession planning for family businesses can potentially be an emotional one, or not depending on a number of factors which I have attempted to identify throughout this report. ‘A change of ownership and/or management is inevitable for every business – everyone exits eventually. But moving out of a business is often harder than moving in.’ (McLeod M. , Farm Ownership & Transition Workshop Resource Book., 2014). Every family business is unique and faces its own challenges around different personalities within the family and different needs, wants, ideas, opinions and aspirations of each family member. There is no one size fits all, and I believe it comes down to leadership within the family to co-ordinate and govern a family business successfully. Succession planning within families is about open communication from the beginning, including the ability to sit down and listen to each family member’s goals and aspirations. From a governance perspective, I also believe having strong discipline around separating family time and business is paramount in governing a family business whilst still maintaining strong family relationships.

One of my survey participants believed a family culture and identity was one of the most important factors in a successful family business, as well as installing the right values into children from a young age. For family succession to be successful, he believed it was highly important to include children in the business from a young age and for it to always be referred to as ‘our business’ rather than ‘Dad’s business’. Another survey participant emphasised the importance of having clearly defined roles within a family business, reflective of each individuals strengths and capabilities rather than ‘as of right’. For a family business to be successful, he also strongly believed in ‘grass roots’ training to ensure a thorough understanding of the business from the ground up. Michael Hill expresses a similar opinion in his books ‘Toughen Up’ and ‘Think Bigger’ where he emphasises the requirement for children to prove themselves within the business without receiving special treatment because they are a family member.

As kiwifruit orchard prices continue to rise underpinned by strong industry confidence, it becomes increasingly difficult for the younger generation to acquire orchard ownership and become involved within the industry as a grower. For those families well entrenched in the kiwifruit industry, I believe succession planning is now more important than ever if those families wish to continue into the future and achieve longevity and future prosperity for their existing businesses.

Dylan Barrett

Implementation of the fonterra palm kernel guideline.

Executive summary

The use of Palm Kernel (PK) as a supplementary feed for NZ dairy cows has seen unprecedented growth over the past decade, despite volatile milk prices. Demand has been driven by system intensification, a production focus and climatic challenge. The availability, flexibility and cost- competitiveness of PK make it a popular choice with dairy farmers. 

New Zealand imports around a third of total palm kernel produced and is the largest sole importer. Palm kernel is a by-product of the palm oil industry, which is considered to have an adverse global environmental footprint associated with deforestation, biodiversity loss and greenhouse gas emissions, particularly in Indonesia and Malaysia.

In response to an increasing amount of PK fed to dairy cows by its suppliers, Fonterra Co-operative Group (Fonterra) announced the introduction of a PK guideline in September 2015, recommending a maximum feeding level of 3 kg/cow/day to future-proof the co-operative as a supplier of pasture- based milk. Further communication indicated a milk test was being developed to assess PK feeding levels. There was a likelihood that high PK feeding levels were causing milk composition changes that could cause issues with manufacturing and/or customer specification requirements.

The aim of this project was to understand individual farmer use of PK, their understanding of the Fonterra PK Guideline, the changes and time-frame required for implementation and the perceived impact. Their views on the likelihood of a future nil PK directive and an associated transition time were also explored.

Ten Fonterra farmers were interviewed who were feeding above the PK guideline level for all, or a part of, the season. In addition, industry professionals (industry body and farm consultants) were also interviewed to give a broader perspective to how implementation could be achieved and what the impact would be.

All farmers rated PK as important or very important to their farming business, despite using it in different ways and for different reasons. Findings indicate farmers use PK as a base feed to underpin stocking rate or predictable climatic challenge, a buffer for vagaries of pasture growth or as an emergency response to an adverse climatic event, or a combination of these uses.
Interviews found implementation of the guideline is achievable. For most farmers it is anticipated change will be incremental rather than transformational. Options to reduce the level of PK fed to guideline levels included:

  • Reducing feed demand through stocking rate, culling and drying off decisions,
  • Reducing feed supply by non-replacement of PK above guideline levels
  • Increasing feed supply from home-grown feeds or alternative imported feedsThe impact of the guideline on farmers will depend on the degree of change required to adhere to the guideline and the climatic challenges they face. The impact could be minimal or even negated if other aspects of the farm feed system are optimised.There is a need for farming systems to increase their resilience to climatic challenge and adverse events. Although System 4 & 5 farmers (high input) would be most immediately affected by the guideline, it was anticipated System 1 to 4 farmers (nil, low and medium input) would be made most

vulnerable, particularly in challenging or adverse climatic events. It is recommended Fonterra communicate a PK policy for adverse climatic events as this was considered to be the most likely challenge to compliant feeding thresholds.

Farmers indicated a twelve month period would be required for transition. It is recommended Fonterra adopt this time-frame for compliance and provide milk test results during this period. It is anticipated there will be variation in feeding levels for compliance both between farms and within individual farms, due to seasonality and management differences. Farmers should be encouraged to challenge the milk test during transition to find their individual farm feeding thresholds.

A consistent message from interviews was the need for Fonterra to provide more clarity and proof around what they were asking farmers to do. Farmers were unclear whether the motivation for the guideline was milk composition creating processing issues or customer expectations around sustainability or product specification, or a combination of both. It is recommended that Fonterra provides relevant research around the key drivers of the guideline and clarity around factors that will influence farmer management.

Seven out of ten farmers and four out of six industry professionals felt Fonterra was unlikely or highly unlikely to introduce a nil PK directive in future. Reasons given were that adherence to the guideline would overcome milk processing issues, a perceived lack of consumer willingness or ability to pay a premium for a PK-free product and the risk of supply loss to competitors for Fonterra. Those that believed a future nil PK directive was likely, thought so because of issues with customer perception and sustainability. Farmers felt that if a nil PK directive was made, they would require 2-3 seasons to transition.

Although beyond the scope of this project, interview findings have also led to broader recommendations for Fonterra to develop a “Know Your Customer” programme, develop a NZ grass- fed certification standard and investigate a ‘grass-only, home-grown’ specialty milk pool.

Rachel Baker