Editorial: Agri's mojo is back
OPINION: Good times are coming back for the primary industries. From sentiment expressed at Fieldays to the latest rural confidence survey results, all indicate farmer confidence at a near-record high.
OPINION: A $130 million loan from major shareholder Bright Dairy will only keep the lights on at Synlait for so long.
The listed company urgently needs to sell off its under-utilised assets in the North Island, notably a $260m processing plant at Pokeno, to meet banking covenants and reduce debt.
Synlait’s share price dropped to around 38c/share last week, valuing the company at only $85 million. This means there will be little appetite from shareholders – including a2 Milk Company which holds a 20% stake in the company – to take part in a capital raise.
Now Synlait faces a new problem: many of its farmer suppliers want to walk away. They have issued cessation notices. A silver lining is that farmers need to give Synlait two years notice. While this buys the milk processor time to steady the ship, some think it could be too little, too late for Synlait.
The company says the cessation to supply notices from a “significant majority” were not a surprise given its current performance.
“Farmer suppliers have signalled they want to see Synlait’s balance sheet deleveraged so advanced rates can be lifted further, and submitting a cessation notice provides an option, rather than a clear intention to sign with other processors,” it says.
The next few months will be crucial for Synlait. The short-term outlook isn’t looking great. In April, Synlait reported a $96 million half-year loss. Last week it signalled full-year earnings will be at the lower end of its $45m-$60m range, before expected one-off charges.
Synlait has been hit by high costs, falling sales, the need to repay debt and a row with its major customer A2 Milk, as well as being unable to sell its consumer dairy products business Dairyworks, which it has valued at $120m. The board and management remain confident of steering the company through the current storm.
However, things look to get worse before it will get better for Synlait.
A brilliant result and great news for growers and regional economies. That's how horticulture sector leaders are describing the news that sector exports for the year ended June 30 will reach $8.4 billion - an increase of 19% on last year and is forecast to hit close to $10 billion in 2029.
Funding is proving crucial for predator control despite a broken model reliant on the goodwill of volunteers.
A major milestone on New Zealand's unique journey to eradicate Mycoplasma bovis could come before the end of this year.
We're working through it, and we'll get to it.
The debate around New Zealand's future in the Paris Agreement is heating up.
A technical lab manager for Apata, Phoebe Scherer, has won the Bay of Plenty 2025 Young Grower regional title.
OPINION: It's official, Fieldays 2025 clocked 110,000 visitors over the four days.
OPINION: The Federated Farmers rural advocacy hub at Fieldays has been touted as a great success.