Reserve Bank Bulletin looks at dairy sector vulnerabilities

New Zealand Reserve Bank Bulletin looks at dairy sector vulnerabilities


The Reserve Bank today published a Bulletin article, ‘An updated assessment of dairy sector vulnerabilities’.


The article investigates the severity of cash flow pressures currently facing dairy farmers, and assesses the potential financial stability implications if the payout remains low for an extended period. The article estimates that around half of dairy farmers are now facing a second consecutive season of cash losses, placing the sector under significant financial pressure. The authors find that the majority of farms would remain viable in a sustained low payout environment, although some highly-indebted farms would face considerable difficulties. Losses for the banking system are estimated to be manageable even under a severe stress scenario. 


More information: Reserve Bank Bulletin


New Zealand Updated weights for Trade-Weighted Index

New Zealand Updated weights for Trade-Weighted Index


The annual re-weighting of the Trade-Weighted Index (TWI) will take effect on Wednesday 16 December 2015.


The TWI is a measure of the value of the New Zealand dollar relative to the currencies of New Zealand’s major trading partners. There are 17 currencies included in the TWI and each currency is weighted using the country’s bilateral trade with New Zealand.


The TWI weights for the next 12 months are:




Old weight

New weight

Australian dollar




Chinese yuan




United States dollar




Euro zone euro




Japanese yen




United Kingdom pound




Singapore dollar




South Korean won




Malaysian ringgit




Thai baht




Taiwanese dollar




Indian rupee




Indonesian rupiah




Canadian dollar




Hong Kong dollar




Vietnamese dong




Philippines peso




Scaling factor





Technical information about the TWI is available here.


Unite union condemns exclusion of ‘just transition’ in the Draft Paris Outcome

Source: Unite Union – Press Release

Headline: New Zealand's Unite union condemns exclusion of ‘just transition’ in the Draft Paris Outcome
Unite union condemns the exclusion of ‘just transition’ measures in the 
Draft Paris Outcome and stands with world’s most vulnerable and against the 
corrupted COP process.
Unite union climate justice spokesperson Gary Cranston joined a sit-in of 
disaffected civil society representatives at COP21 in Paris today following the 
release of the draft negotiation document.
“In the last few days of the negotiations, unions and climate impacted allies have 
been working hard to ensure Governments agree to include wording in the 
climate agreement that will support a just transition away from fossil fuels that 
will protect those most vulnerable” said Unite Union’s representative in Paris, 
Gary Cranston.
“A just transition means moving to a low-carbon and climate-resilient economy 
that maximises the benefits of climate action while minimising hardships for 
workers and their communities”.
But today Government’s confirmed their intention to remove any meaningful 
inclusion of a just transition from the negotiation text.
First governments promised us a genocidal 2.7 to 3.9 degrees Centigrade rise in 
global temperatures as a result of their woeful pre-negotiations commitments. 
Now they are avoiding including wording in the text that could make them take 
responsibility for the suffering that this will lead to.
Unite Union adopted a position on climate justice at its annual conference last 
week in Auckland. Many Unite members participated in the national protests for 
climate justice on the 28th of November.
“These people are Unite union members. Pacific Island peoples facing cultural 
genocide from rising sea levels, Filipino migrant workers whose homes and 
homelands are being smashed by hurricanes, workers experiencing gender 
related discrimination and persons with disabilities.” said Gary Cranston.
“Many of our members are the world’s least responsible for causing climate 
change yet are the ones who are being impacted the most. That is why I am here 
We need a just transition of the world’s workforce and the creation of decent 
work and quality jobs for all workers. That, however, cannot be achieved within a 
process so deeply corrupted and controlled by vested and opportunist interests 
committed to an economic model named Capitalism that guarantees social and 
environmental catastrophe.
Unite union supports those successfully taking action for climate justice in their 
own communities and workplaces and everybody planning on engaging in civil 
disobedience this coming weekend with the realistic expectation that the 21st UN climate negotiations will not achieve the climate justice we need.
Labour unions push for a ‘just transition’ at COP21 

Amnesty International launches Our Voices – public submission process on the refugee quota

Source: Amnesty International – Press Release

Headline: Amnesty International launches Our Voices – public submission process on the refugee quota

To mark Human Rights Day Amnesty International today launched a public submission process on the refugee quota – Our Voices.

The human rights organisation made the announcement outside Parliament in Wellington today, launching Our Voices as a chance for all New Zealanders to have their say on whether the Government should provide safety for more refugees each year.

“Often the best decisions are made when you seek input from lots of different voices,” said Grant Bayldon, Executive Director of Amnesty International in New Zealand.

“Next year the New Zealand government will be carrying out a review of the country’s refugee quota, and we know the Government is busy but Amnesty International believes it is important for all voices from the community to be heard on this issue.

“We want to hear from teachers and business leaders, from refugee community leaders, from faith communities, from students, mums, dads, grandparents and neighbours.”

Submissions will be open to the public via until 5.00pm on 5 February – people can submit written submissions, videos, photos and stories.

On 15 February 2016 Amnesty International will host a public hearing in Wellington for submissions, giving people the opportunity to submit in person.

“Today is Human Rights Day, it’s a day to celebrate our rights, but in a year that has seen the worst global refugee crisis in 70 years we can’t forget the plight of those children, women and men who are fleeing war and persecution and seeking safety,” said Grant Bayldon.

“We can’t stand by while so many other people internationally need our support, it’s time to amplify our voices and remind the Government that we do care about the plight of other people world-wide.”

“Amnesty International is excited to be able to provide this platform for our voices to be heard and then passed on to decision makers.”

The submissions page is open here:

New Zealand Reserve Bank Official Cash Rate reduced to 2.5 percent

Source: New Zealand Reserve Bank Governor Graeme Wheeler

Headline: New Zealand Reserve Bank Official Cash Rate reduced to 2.5 percent


Statement by Reserve Bank Governor Graeme Wheeler:


The Reserve Bank today reduced the Official Cash Rate (OCR) by 25 basis points to 2.5 percent.


Globally, economic growth is below average and inflation is low, despite highly stimulatory monetary conditions.  Financial markets remain concerned about weaker growth in emerging economies, particularly in China.  Markets are also focused on the expected tightening of policy in the United States and the prospect of an increasing divergence between monetary policies in the major economies.


Growth in the New Zealand economy has softened over 2015, due mainly to lower terms of trade.  Combined with increases in the labour supply from strong net immigration, the slowdown has seen an increase in spare capacity and unemployment.  A recovery in export prices, the recent lift in confidence, and increasing domestic demand from the rising population are expected to see growth strengthen over the coming year. 


The New Zealand dollar has risen since August, partly reversing the depreciation that occurred from April.  The rise in the exchange rate is unhelpful and further depreciation would be appropriate in order to support sustainable growth.


House price inflation in Auckland remains high, posing a financial stability risk.  Residential building is accelerating, and recent tax and LVR measures are expected to reduce housing pressures.  There are some early signs that Auckland house price inflation may be moderating.


CPI inflation is below the 1 to 3 percent target range, mainly due to the earlier strength in the New Zealand dollar and the 65 percent fall in world oil prices since mid-2014.  The inflation rate is expected to move inside the target range from early 2016, as earlier petrol price declines will drop out of the annual calculation, and the lower New Zealand dollar will be reflected in higher tradables prices.


There are a number of uncertainties and risks to this outlook.  In the primary sector, there are risks that dairy prices remain weak for longer, and the current El Niño results in drought conditions and weaker output.  Risks to the domestic outlook include the prospect of net immigration staying high for longer and of household expenditure picking up on the back of strong house prices.


Monetary policy needs to be accommodative to help ensure that future average inflation settles near the middle of the target range.  We expect to achieve this at current interest rate settings, although the Bank will reduce rates if circumstances warrant.  We will continue to watch closely the emerging flow of economic data.



Source: Fonterra



Fonterra Co-operative Group Limited today maintained a forecast Farmgate Milk Price of $4.60 per kgMS. Along with the November announced estimated Earnings Per Share range of 45-55 cents, this amounts to a total available for payout of $5.05-$5.15 kgMS and would currently equate to a total forecast Cash Payout of $4.95-$5.00[1].


Fonterra is required to consider its forecast Farmgate Milk Price every quarter as a condition of the Dairy Industry Restructuring Act (DIRA).


Chairman John Wilson said the stable forecast reflected the Board and management’s view that international prices would continue to improve in the first half of next year.  


“We are looking out over the next nine months and basing our forecast on the view that current, unsustainably low prices will continue to impact production levels globally. We support the consensus view in the market that an improvement will take place, but the market remains volatile. While there are signs of a recovery, particularly in China, we still need the imbalance between supply and demand to correct.


“That imbalance is starting to reduce with year to date production in the United States up by only one per cent and slowing, and New Zealand volumes expected to be down by at least six per cent over the current season. In the EU, however, farmers are continuing to push production, currently up one per cent.”


Fonterra’s Board also reviewed the Fonterra Co-operative Support loan. The loan was made available on production from 1 June to 31 December. The loan of 50 cent per kgMS is interest-free until 31 May 2017 with repayments triggered when the Farmgate Milk Price exceeds $6 per kgMS.


Mr Wilson said the Board’s scheduled review had weighed up the improved Farmgate Milk Price and higher Earnings Per Share forecast since the loan was launched, when the milk price was at $3.85, and the need for financial discipline from the Co-operative. The Board had decided not to continue the Co-operative Support loan for milk collected after 31 December, but will monitor conditions and assess the need to continue the support if market conditions changed later in the season.

“We will provide some $390 million in support to around 75 per cent of our farmers through the most productive half of the season, including the peak. Farms typically produce 60 per cent of their milk in the first half, with production beginning to taper off from December, so we have provided support when it is needed the most.”




[1] Cash Payout comprises the Farmgate Milk Price plus the dividend per share. Total available for Payout is the Farmgate Milk Price plus earnings per share.

Note: currency is New Zealand dollars unless otherwise stated.



About Fonterra

Fonterra is a global leader in dairy nutrition – the preferred supplier of dairy ingredients to many of the world’s leading food companies. It is also a market leader with its own consumer dairy brands in New Zealand and Australia, Asia, Africa, the Middle East and Latin America. Fonterra is a farmer-owned  co-operative and the largest processor of milk in the world. It is one of the world’s largest investors in dairy research and innovation drawing on generations of dairy expertise to produce more than two million tonnes of dairy ingredients, value added dairy ingredients, specialty ingredients and consumer products for 140 markets.

[1] Cash Payout comprises the Farmgate Milk Price plus the dividend per share. Total available for Payout is the Farmgate Milk Price plus earnings per share.

Launch of ‘International Declaration and Best Practices on the Promotion of Journalists Safety’

Source: Al Jazeera – Statement

Headline: Launch of ‘International Declaration and Best Practices on the Promotion of Journalists Safety’

Launch of ‘International Declaration and Best Practices on the Promotion of Journalists Safety’

GENEVA, Dec 9, 2015 – The Al Jazeera Media Network, International Press Institute (IPI), Geneva Global Media and the Geneva Press Club today launched the International Declaration and Best Practices on the Promotion of Journalists Safety.

The International Declaration, which was timely unveiled on the eve of International Human Rights Day, reinforces existing international obligations and mechanisms related to journalists safety and contributes to the protection of journalists’ rights.

The failure of states to implement these mechanisms and fulfil their international obligations has turned journalism into an increasingly dangerous profession. In addition to reminding states of their responsibilities, the International Declaration also presents a set of best practices that media organisations should consider in an attempt to limit the dangers of their profession.

At least 73 journalists have been killed in 2015, according to IPI’s Death Watch. That tally includes journalists and media staff who were deliberately targeted because of their profession or who lost their lives while on assignment.

The document was also in collaboration with Africa Media Initiative (AMI) and the International News Safety Institute (INSI), which saw the participation of over 70 representatives from media organisations, press freedom and journalist groups, international organisations and independent experts.

Amnesty International to make announcement on refugee quota review – 1.00pm tomorrow.

Source: Amnesty International 

Amnesty International to make announcement on refugee quota review – 1.00pm tomorrow.
AMNESTY INTERNATIONAL Amnesty International to make announcement on refugee quota review **1.00PM, 10 DECEMBER 2015, OUTSIDE PARLIAMENT, WELLINGTON **   On Thursday 10 December 2015 Amnesty International supporters will gather outside of Parliament in Wellington to celebrate International Human Rights Day with a special announcement on the review of the refugee quota. “10 December is human rights day – it’s a day to celebrate our rights, but also a day where it’s important to say – let’s share those rights with others, let’s not stand by while so many other people need our support,” said Grant Bayldon, Executive Director at Amnesty International in New Zealand. “That’s why on Thursday at 1.00pm, Amnesty International will be making a special announcement on the review of the refugee quota. “Next year the New Zealand government will be carrying out a review of the country’s refugee quota and Amnesty International believes that the Government should be asking how much, not how little, we can do to help refugees. Currently the annual refugee quota is just 750, and it hasn’t changed in almost 30 years. Perhaps 30 years ago this was an acceptable number, but today with so many people fleeing crisis, conflict and persecution in their own countries, 750 just isn’t enough.” The announcement on the quota will be part of celebrations for Human Rights Day. Outside of Parliament, the celebrations will begin at 12.30pm as Amnesty International has invited the public to join them and celebrate the day with food and entertainment. At 1.00pm students from Wellington East Girls’ College on behalf of students from around the country will hand over beautiful handcrafted banners to Hon Chester Borrows with a clear message asking the Government to double the refugee quota. The announcement by Grant Bayldon will follow the banner handover. Media are invited to attend all the events outside of Parliament. EVENTS WHAT:    School students hand over handcrafted Double the Quota banners to Chester Borrows and announcement on the review of the refugee quota WHEN:    1.00pm – Thursday 10 December WHERE:  Next to the Seddon Statue – Outside Parliament Buildings, Wellington

Al Jazeera mourns death of colleague in Syria  

Al Jazeera mourns death of colleague in Syria

Ibrahim was injured in the head after he went to film the bombardment in Homs province [Al Jazeera]

For immediate release
Al Jazeera mourns death of colleague in Syria

  •  Al Jazeera Arabic cameraman Zakaria Ibrahim killed in Homs
  • Ibrahim is the sixth Al Jazeera staff killed in Syrian conflict

Doha – December 8th, 2015: Al Jazeera Media network mourns the loss of Al Jazeera Arabic’s cameraman, Zakaria Ibrahim, after he was injured by sniper fire while covering a Syrian army bombardment in the province of Homs.
Ibrahim, who died from his injuries on Monday, was in the village of Teldo to report on what was expected to be a ceasefire there between rebels and the forces of President Bashar al-Assad.
He joined Al Jazeera as a cameraman in early 2014 and had filmed numerous clashes and peace agreements in Homs.
Commenting on his death, Al Jazeera Arabic Managing Director Yaser Abuhilalah said:
“It is tragic that we have lost many colleagues in the line of duty this year, the latest being our cameraman in Homs, Zakaria Ibrahim. We depend and will continue to depend on our teams in Syria, who never left their besieged and demolished hometowns. They were citizen journalists who initiated contact with Al Jazeera and only asked to cover the hardships of their families and those around them. Al Jazeera endeavoured to bring them in and provided them with the support to enhance their capabilities.
“Al Jazeera connected Zakaria Ibrahim and his other colleagues in Syria, who were living under siege, to the rest of the world. The channel will not spare any effort in alleviating the pain of their families and ensuring their security. The human sacrifices Al Jazeera makes is only a fraction of the sacrifices made by all those in the press and humanitarian agencies in Syria.
“Al Jazeera will not give up its moral and professional responsibility towards colleagues and viewers.”
Zakaria Ibrahim is the sixth Al Jazeera staff member who has been killed in the line of duty while covering the conflict in Syria since 2011. Last September Al Jazeera Arabic reporter Ahmad Abdel Karim Masalameh died while covering the fighting there. In December 2014, Al Jazeera’s Mahran al-Dairi was killed while reporting on clashes between regime troops and rebels in Deraa. Mohammad Jalil al-Qasem was killed in September 2014 in the suburbs of Idlib. On December 4, 2013, cameraman Yasser al-Jumaili was shot multiple times as he tried to leave Syria by road after finishing an assignment. In January 2013, Mohammad al-Hourani, an Al Jazeera correspondent in Deraa, was killed by a sniper in the suburb of Busra al-Harir.

New Zealand Superannuation Fund – Catherine Savage appointed Chair

Source: New Zealand Superannuation Fund – Statement

Headline:  Catherine Savage appointed Chair

Catherine Savage appointed Chair of the Guardians of New Zealand Superannuation


Catherine Savage has been appointed Chair of the Guardians of New Zealand Superannuation, the Crown entity that manages the $30 billion New Zealand Superannuation Fund, effective 1 January 2016.

Ms Savage will succeed Gavin Walker, who has chaired the Guardians since 2012 and was first appointed to the Board in 2010. Mr Walker said he had resigned the Chairmanship with the intention of focusing on a smaller group of Board commitments. “The Fund is performing strongly and is well placed for the future. With a strong Board, experienced management team and a proven investment strategy, I feel I am leaving it in good hands.”

Ms Savage said she was delighted to be appointed Chair. “The New Zealand Superannuation Fund is a vitally important institution for our country, children and future generations,” said Ms Savage.  “My fellow board members and I take the responsibility of investing taxpayer money very seriously.”

Ms Savage said the Board remained committed to the Fund’s long-term investment strategies, leading approach to responsible investment and high degree of transparency.

Current Guardians Board member Lindsay Wright has been appointed Deputy Chair.

Catherine Savage has been a Guardians Board member since 2009, and Deputy Chair since 2012.  She is Managing Director of Savage Group Limited, Chair of the National Provident Fund, and an independent Director of Kiwibank, Todd Family Office, and Pathfinder Asset Management. Catherine was Treasurer of the National Gas Corporation from 1991-1993 prior to moving to AMP Capital Investors (NZ) Ltd where she held a number of senior management roles including Managing Director 2000-2007.

Lindsay Wright is currently Regional Head Institutional, Alternatives and Investment Solutions Business, Asia Pacific with Invesco Hong Kong Limited. Prior to joining Invesco Lindsay was CEO of Harvest Alternatives Investment Group and Co-CEO Harvest Capital Management Limited (second-largest funds management company in China). She has also held roles as Managing Director and Global Head of Strategy and Business Development for Deutsche Asset Management/DWS based in New York as a part of a 25 year career with Deutsche Asset Management and Deutsche Bank.  Lindsay is also on the Board of Directors at Kiwibank. She was appointed to the Guardians Board in 2012.