October 25, 2012

Landcorp's dairy production expected to grow

Landcorp's record dairy production in 2011 is estimated to significantly grow further this year.

Part of that will come from the former Crafar family farms, which the country's biggest farming operation will manage on behalf of Shanghai Pengxin of China, which will take ownership in early December.

Shanghai Pengxin will spend more than US$15 million over three years to lift production on the 16 farms in the North Island to about five million kilogrammes of milk solids a year.

Chief executive Chris Kelly said Landcorp will also continue expanding dairy production in some other areas, including the Wairakei Estate in the central North Island. Landcorp is converting the land from forestry to farming and already has about 4,500 hectares in dairy production.

"We entered into a joint venture in 2004 to develop something like 22,000 hectares of land into dry stock and dairying,'' he said.

''That project ceased very abruptly at the end of 2010, as a result of the carbon tax impost that occurred with the Government entering into the Kyoto protocol and the Emissions Trading Scheme. We are just about to restart that programme again - there's something like 4,000 hectares still lying fallow at present - and over time we will be developing that in conjunction with our joint venture partners."

Kelly said Landcorp is also converting more farm land to dairying in Canterbury on a property called Maronan Pastures near Ashburton. "The cheapest form of feed is irrigated Canterbury land right now, and we still have some undeveloped land where we have water available ... so we're putting big storage dams and centre pivot irrigators there," he said.