December 2002

Chairman & Directors' elections

At the recent United Wheatgrowers electoral committee meeting Brian Dillon, Ian Morten and Richard Green were reappointed as directors of the company. Richard Green had indicated that he would not seek re-election after rotational retirement. However, due to a lack of other nominations and the poor health of chairman, Syd Worsfold, Richard agreed to continue in the role, but made it clear it was a temporary measure. We thank Richard for this commitment.

The directors later elected John Wright as chairman, replacing Syd Worsfold, and Ian Moreton as vice-chairman. Ian has also indicated that his placement in this role is of a temporary nature.

Syd Worsfold was unable to attend the meeting but will continue as a director of the company. Syd is currently recuperating at home. The electoral committee and board wished Syd a speedy recovery and thanked him for his significant contribution to United Wheatgrowers and the wheat industry during his role as chairman over the last 5 years.

Insurance

The electoral committee recently supported the board's recommendation and set the insurance levy at $2.95/tonne + GST for the 2003 delivery season, from 1 February 2003. The board was disappointed to see the levy increase from $2.50 in the current season but felt it was a fair reflection of the state of the insurance industry and the recent claims on the scheme.

After significant negotiation your directors were able to get FMG to agree to keep all perils seen in the current contract. This was seen as paramount. The new contract can be viewed at http://uwg.co.nz/contracts.cfm

The board has signed off on the new Commodity Levy Order resulting from the recent referendum. The insurance levy is collected under this Commodity Levy Order. The order is due to go before cabinet early in the new year with the aim of having the legislation in place by 1 February 2003. The current order runs through to September 2003.

FMG will consult with UWG board directors to allocate the most sensibly located assessor from the electoral committee. The assessing process will then progress.

This first step in the process is very important to enable tight control. The whole process is more fully described on the website, http://uwg.co.nz/insurance.cfm

Quality Assurance

Much discussion has taken place over the Quality Assurance diary scheme and proposed registration-based system.

There is no question of end-users' desire to provide traceability and quality assurance to consumers, particularly in the baking industry.

There is also no question that the current poor uptake of the diary system has been driven by processors and their need to procure grain in times of shortages.

The United Wheatgrowers board firmly believes that farmer control should be retained over a scheme providing robust traceability and quality assurance, and that it is only a matter of time before consumers demand this of our industry.

A gradual implementation will better suit growers. With full support of the United Wheatgrowers board and electoral committee, the New Zealand Crop Quality Assurance taskforce aims to call for registrations under the new scheme in Autumn/Winter 2003. More details will follow on costings and requirements. Processors and end-users are being encouraged to provide incentives for growers to change to the new scheme. As for the 2003 harvest, the current diaries are required.

Processors are adamant that the diary system be supported during the transition period to the registration system. The taskforce wishes to encourage the whole industry to support the diaries for the approaching harvest to prove the importance of quality assurance to the industry.

Website

Survey Results

The electoral committee and directors recently carried out a telephone survey of wheat growers to ascertain the trends in wheat and other cereal plantings. We believe this survey has provided some useful information for the whole industry and thank those growers who participated. The sample represents approximately ten percent of the wheat grown in the country.

The results are as follows (Hectares):

Wheat Competition

Investment in Research

The electoral committee was supportive of the directors' recommendation of setting the Wheat Industries Research Act levy at zero for the 2003 year.

United Wheatgrowers has the ability to levy growers under this act for the purpose of research, as do industry partners the New Zealand Flour Millers Association, and New Zealand Association of Bakers. The other two organisations do levy members and invest significant funds in research for the benefit of the whole industry. The United Wheatgrowers levy has been set at zero since the implementation of FAR.

The three organisations form the Wheat Industries Research Liaison Committee where research is co-ordinated (FAR holds one of our positions on the liaison committee).

The committee is currently involved in a project promoting good practice for the use of grain insecticides in storage. The project is researching alternative management practices and plans an educational programme next year. The message to growers is to be sure these products are used only when necessary and accurately measured into grain.

United Wheatgrowers has been more recently investing capital in the Crop and Food Research cereal programme targeting Marker Assisted Selection, and specialty wheat breeding. The board strongly believes that the Wheat Industries Research levy on wheat should not be reinstated until some tangible grower benefit can be seen from the investment of the funds. The board equally believes that the company's capital should not be overly-depleted as a result of this investment.

At a recent strategic planning day, the board decided to employ a consultant to review the current investment and look at other research investment options. Growers must consider whether an investment in value-adding research may better provide for the next generation of wheat growers. Other New Zealand agricultural industries are making this investment in value-adding processes and intellectual property. These are the types of options that United Wheatgrowers must investigate on behalf of the wheat industry.

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