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RESERVE BANK CONFIRMS INTERVENTION IN CURRENCY - NZ DOLLAR FALLS SHARPLY
The NZD fell sharply after Reserve Bank data confirmed it had sold a net NZ$521 million during August, its biggest sale of New Zealand dollars since July 2007. Prime Minister John Key also weighed in, saying he thinks the New Zealand dollar's fair falue is around US65c.
AUCKLAND RENTS PICKED TO RISE BY 5% OR LESS
Barfoot and Thompson's latest survey of landlords shows most are expecting to increase rents by 5% or less in the coming year. That won't be enough to cover their rising costs and will push yields down further. However most landlords are expecting to reap capital gains on their portfolios.
THE BANKS LAUNCH A NEW SCHEME FOR OWNERS OF LEAKY UNITS
The Bankers Association and major trading banks have launched an escrow-based scheme to fund remediation work on multi-unit complexes, avoiding the need to manage funds through their body corporate accounts.
DEMONSTRATIONS ESCALATE IN HONG KONG
Pro-democracy demonstrations gathered pace in Hong Kong sending a ripple of uncertainty through Asian financial markets and forcing Hong Kong's chief executive to issue a statement denying rumours that the Chinese army was set to intervene.
FONTERRA REBRANDS RD1 STORES AS FARM SOURCE
Fonterra is rebranding 67 RD1 rural supplies stores under the Farm Source banner and will also roll out a new customer loyalty scheme.
WHOLESALE RATES
The 90 day bank bill rate is unchanged at 3.73%.
OUR CURRENCY
Check our real-time charts here. The Kiwi dollar fell sharply in afternoon trade following confirmation of Reserve Bank intervention. The NZD is currently 77.9 USc and 89.3 AUc. The TWI currently sits at 75.99.
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24 Comments
New Zealand dairy co-operative Fonterra is considering launching a NZ$100 million ($77.4 million) fund in the next year which would tap external capital to lend to its farmer shareholders in the face of falling global dairy prices.
Theo Spierings, Fonterra's chief executive, said on Monday the world's largest dairy exporter is looking at ways to give its shareholders access to cash that would allow them to expand after it cut its farmgate milk price forecast to a six-year low last week. Fonterra is owned by 10,600 farmers.
"With the milk price being low and the share prices being strong, farmers really will be constrained for cash," Spierings told Reuters in an interview.
"We shouldn't force them to go to the bank to borrow a whole lot of money. We should make it available ourselves."
The guys a genius, the market is full of milk, the solution is to keep over producing. I suppose the fund is second in line to the Aussie banks. Then again it will pay the interest.
Hey Henry, what if NZ dairy farmers are .50c a kg more eficient than the USA but Fonterra is a $1 less efficient?
page 16 & page 17
http://issuu.com/ashguardian/docs/dairy_foc_nenewnewnewnew_-_july
look at the graphic, not the headline
By making a fund "available" then they can throw any number of capital demands at their suppliers, demanding that they allow Fonterra to buy-in (fund equity) from the fund if they can't afford the changes. Anyone who can't afford it, is of course, a terrible farmer and be subject to non-compliance penalties.
Commerce Commision asleep at the wheel again......
And I ask for the second time where is this money coming from??
it has a name:
Spierings said the Equity Partners' Fund was another tool to give farms access to the equity they need to grow. The ANZ Greener Pastures report in 2012 said farmers face significant challenges in raising sufficient capital to fund growth and support farm turnover.
http://www.nbr.co.nz/article/fonterra-considers-equity-fund-part-farms-source-launch-bd-163155
Fonterra Cooperative Group may establish an Equity Partners' Fund that would source capital from investors for farmers in New Zealand and Australia.
It's one of the new offerings rolled out today by the giant dairy co-operative under its new Farm Source hubs which will combine retail service, support, rewards, digital technology and financial options.
and a start date:
and a funder/funding source:
Fonterra wants to establish an equity partners' fund before the end of the year that would source capital from global investors for farmers in New Zealand and Australia.
http://money.msn.co.nz/businessnews/national/8912554/fonterra-considers-new-equity-fund
So this was the money that was being raised and spent for the Chinese Infant Formula Company????
" raising sufficient capital to fund growth and support farm turnover."
Mein Gott!!
Am I the only one who hears alarm bells? So... this capital is going to be cheaper and less "fishhooks" than bank lending?? And the investors don't want decent returns or assurances?
My alarm bells rang on 28 Aug when I read Van der Poel believes TAF will not last forever.
In the future, the co-operative would have to evolve again as it outgrows that capital structure.
http://www.stuff.co.nz/business/farming/dairy/10397713/Retiring-Fonterr…
Fonterra chief executive Theo Spierings says it wants to give flexibility to farmers to "share-up" following concerns that the eight per cent growth in milk production this season could mean some farmers would have to borrow significant loans to meet the share standard.
http://money.msn.co.nz/businessnews/national/8912554/fonterra-considers-new-equity-fund
pre TAF one could lvr shares to 100% at the bank. Now not so.
Whats at the core, poor incomes, or poor share returns (being dividend and share price) or too high a share price.
why not just let folk buy a supplier share and simutaenously flick on to the fund. (i.e. no need for outside equity or fund loan or whatever)
what are we missing here?
The same, but in a bigger context and less PC:
http://www.oftwominds.com/blogsept14/whats-optimized9-14.html
Is this being driven by a higher political force? Aussie farms are in parts struggling, chinese have bought up large over there and the locals are getting a bit antsy. Could this be an ANZ initiative to counter the march of the Asian Tiger? Or is it a way to allow the Tiger to spring ever higher?
Listened to a debate in the Senate last week about AU dairying
Senator claims 98% of all australian Dairy Farms are Family owned
Fairly limited corporate farming
AU is pissed off it doesnt have an FTA with China
The Dairy industry in Australia is worth about $1 billion pa in exports
Mainly to China
Apart from New Plymouth Council selling out The Van Diemens Land Company to China the industry is fragmented
That's the only sale of Dairy land to the Chinese that I've heard of - most acquisitions are Wheat and Cotton (Cubby Station) farm operations
Remember Doug Meyers and Lion Breweries
watch this Financial Review interview with Lion
talk about going in a full circle
They're talking about a coming shake-up
http://www.smh.com.au/tv/Business/show/Financial-Review-Sunday/Milking-it
Read into that what you will - they are trying
Interesting Foterrra rebrandng RD1 ,last time they reminded us that RD1 was part of Fonterra they spent a million on reprinting the tankers,management need to be more frugal with spending just like we are being told to be.They do need to do something about a loyalty scheme though-like CRT Farmlands has- last time they tried was a failure due to the fact it was near impossible to get any rewards unless you were doing a conversion.I will always support RD1 though because it is part of the co- op &it it keeps all farm shops honest
is it any wonder that the brands earnings have fallen in ANZ when the supers use tricks like this (with regard to freah bread):
The offending breads were sold under the brands 'Cuisine Royale' and 'Coles Bakery', with labelling and advertising claims that they were "Baked Today, Sold Today" and/or "Freshly Baked In-Store".
ACCC investigators said the goods had in fact been made months earlier on the other side of the world, namely, Denmark, Germany and Ireland, before being frozen and transported to Australia.
The court is yet to make a decision on whether to fine Coles, which faces penalties of more than $3 million.
The ACCC investigation was launched after Jeff Kennett complained when he discovered a loaf of Coles bread that was advertised as freshly baked in-store had been made in Ireland.
On Monday Mr Kennett said the ruling should serve as a warning to supermarkets and advertisers.
Read more: http://www.smh.com.au/business/court-bans-coles-fresh-bread-advertisements-for-three-years-20140929-10nhi0.html#ixzz3EhNq6bWn
not a great endorsement for fly in fly out exec workforce.
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