Premium Essay

Trading Amongst Farmers - Nz

In: Other Topics

Submitted By rangipapa
Words 846
Pages 4
Trading Among Farmers (TAF) and the future of the New Zealand Dairy Industry.

On the 25th June 2012, farmer shareholders in the Co-Op Fonterra, voted in favour of implementing TAF. TAF allows outside capital in the form of buying units; in return for rights to dividends, but not ownership or votes. When researched; there is no agricultural co-op in the world that has taken outside capital and still primarily focused on maximising returns to the supplying shareholders, (ourco-op.co.nz) as primary focus becomes the share price and dividend, eventuating in the demise of the co-operative.

A co-operative is set up by its shareholders to maximise the price for the suppliers milk. Shareholders invest their share capital into a co-operative in return they give loyal supply of the raw material (milk). Farmers will want to supply Fonterra because they own them. When you introduce outside investors you introduce different drivers to the business. Outside investors invest capital to receive a good dividend. The Directors are torn what do they do with company profits, do they retain funds to make the balance sheet strong, do they maximise the milk price or do they maximise the dividend? This divergence of interests will eventually lead to the demise of the co-op. For example Satara and EastPack in the kiwifruit industry. Historically they were both co-ops competing against one another for a number of years. Satara then listed its investor shares on the NZAX. It now had supplying shareholders and investing shareholders. This was fine until Satara wanted to build a new coolstore to better keep the suppliers’ fruit. However the investor shareholders were concerned that the investment in a new coolstore would affect the company profits and therefore dividends. The growers view was that the new coolstore would reduce fruit loss and enhance the Grower orchard gate…...

Similar Documents

Premium Essay

Trading

...Short Introduction to Trading Theory (S.A.Bartlett) Markets possess both complex dynamic and quantum system qualities. Complex as current dynamics are fully determined by current conditions, with every resulting action or cause producing a reaction or effect, forming the base of subsequent future actions. Quantum as states of equilibrium and disequilibrium occurs between different price bands. With the inherit behaviour of dynamic systems highly sensitive to initial conditions, behaviour of price trends remain a deterministic non-periodic flow, with the perceived construction of trends a by-product of the intra and inter day assorted occurrences exhibiting force upon one another. As the occurrence of these deterministic non-periodic flows exhibit both the reflexivity and factual states of the market; reflexive in its self perpetuating/self defeating distribution, fractural in its display of similar dimensional structure, any qualitative trajectory remains highly dependant on the initial conditions. Given the complex dynamical structure of markets, where the initial conditions remain unstable, bifurcating in accordance with the proceeding reaction or effect, the production of long term (fortnightly, monthly quarterly etc) probability distributions remains highly inaccurate. However, as the use of the mathematical models measuring the structural stability, underlying dynamics and non-linear movement of the basin of attraction, the calculation of the probable......

Words: 593 - Pages: 3

Premium Essay

Nz Framework

...the answer to this question rests a lot on the trade-off issue. Students are required to provide specific example outlining this trade-off problem. 2. (i) Refer to paragraphs 51-53 in New Zealand Equivalent to International Accounting Standard 1: Presentation of Financial Statements [NZ IAS 1]. Do you think the financial statements of Briscoes Group complied with these requirements? Suggested solution: Students are not required to reproduce the paragraphs 51-53. These are given below just to identify the relevant regulatory requirement: 51 An entity shall clearly identify each financial statement and the notes. In addition, an entity shall display the following information prominently, and repeat it when necessary for the information presented to be understandable: (a) the name of the reporting entity or other means of identification, and any change in that information from the end of the preceding reporting period; (b) whether the financial statements are of an individual entity or a group of entities; (c) the date of the end of the reporting period or the period covered by the set of financial statements or notes; (d) the presentation currency, as defined in NZ IAS 21; and (e) the level of rounding used in presenting amounts in the financial statements. 52 An entity meets the requirements in paragraph 51 by presenting appropriate headings for pages, statements, notes, columns and the like. Judgment is required in determining the best way of...

Words: 2093 - Pages: 9

Free Essay

Trading

...around 2000 years ago, knew that the first step or rather the first chapter to success is planning. You’d think they’d learn! * * At this stage, a villain would only think of preparing a plan that might lead them to victory but a hero would prepare a plan that can handle multiple possibilities which can turn a potential bad situation in to a moderate acceptable loss. And that is why good always triumphs against evil. Like any well thought out system or machine we require the blue prints and then parts. A car, for instance is a modern day miracle and irreplaceable part of our daily lives, but every car has some key components that are required for it to function, namely: the mechanics, the container, speedometer and rev meter. In the trading industry we also classify essentials into 3 sections: hardware, software and services. * * Hardware: We can start with the organs of every car, the mechanics under the shell, in our case the computer. What makes a Bugatti any different from Maserati, except the price tag? Horsepower, the one thing that puts you ahead of the enemy when racing down Lynnwood road, your ability to push your machine further faster than anyone else. The only way to achieve this would be to build a computer that is capable of running multiple applications at the same time. So what do we look for in such a machine: * Well the brain to any computer would be the CPU (Central processing unit), currently the best CPU on the market you can get......

Words: 2833 - Pages: 12

Premium Essay

A Study on Banking Habits Amongst Farmers in Rural Areas of Shimoga District in Karnataka State

...banking habits amongst farmers in rural areas of Shimoga district . The main objective was to study the banking habits amongst farmers in general with special reference to rural areas of Shimoga district and analyse the deposits and borrowing habits amongst farmers. The study also analysed farmers’ understanding of various facilities available to them by the government through commercial banks, co-operative banks and primary land development banks. The banking habits amongst farmers was examined using empirical data from stratified and area sampling, which covered over 80 households around rural areas of Shimoga district. Results of the present study indicates that although banks have been set up to provide finance, farmers do not have an easy access to these sources. Majority of the respondents opined that the interest rates provided by the banks are high. As a result of this , farmers prefer co-operative societies over banks. The cumbersome process of fulfilling documentary requirements for obtaining a loan acts as a deterrent to the illiterate farmers who are approaching these sources. Though the interest rates have been kept lower in banks, most of the farmers prefer informal loans through money lenders because of timely and adequate availability of loans. So it is essential to address these issues inorder to improve the banking habits amongst farmers in rural areas. It is with this background that this research paper analyses banking habits amongst farmers in......

Words: 253 - Pages: 2

Free Essay

Sustainability Plan Nz Honey

...appreciates and values the natural resources, we endeavour to use it wisely as we create healthy life sustaining honey products sustainably. • Happy Valley sincerely believes all its Honey health products enjoy Health benefits that are compatible with longer, healthier human lives. The flavonoids and Antioxidants and anti-fungal properties help reduce the risk of some cancers, heart disease and assist in reducing ulcers, bacterial gastroenteritis and other disorders. We also believe we have the power to make a positive human impact on the diverse people we touch. We work within the law to ensure all possible environmental, social and economic responsibility targets are met. We believe everyday our actions and love for our natural ‘flying’ farmer friends speaks volumes as the health is measured consistently by the quality of their production, the happiness of our employees, stakeholders, clients and the general at large. Dutifully exerts all efforts in maintain the high stand of quality in managing, manufacturing and delivering beautiful health, vibrant honey to the market thus maintaining its reputation. Leveraging off the fact that Happy Valley complies with its customised, unique designed sustainability model. Objectives The objective is not to ‘make your links appear natural’, the objective is that your links are natural. – Matt Cutts. Divert minimum 50% of all solid waste 2014-2015 (2012-13 level of 30%) of solid waste by company increasing recycling......

Words: 2097 - Pages: 9

Premium Essay

Trading

...unbeneficial. The reasons that WTO stated include: technology changes, protectionism, and import competition (Growth and jobs). Protectionism occurs when a country design regulations to protect “domestic industries against foreign competition by means of tariffs, subsidies, import quotas, or other restrictions or handicaps placed on the imports of foreign competitors” (Protectionism, 2015, para. 1). In reality some countries can adjust better than other countries because of the effectiveness in their policies. In addition, it is clear that the world seemingly operates more effectively via free trade and restricting free trade tends to create more problems. Then again, free trade can stimulate economic long-term growth by providing numerous trading opportunities to gain a comparative advantage, unlimited production possibilities, and improve efficiency (output of products) (McConnell, Brue, & Flynn, 2015). International trade can create jobs through exports; in fact, the Department of Commerce compiled a report showing that exporting goods play a critical role in relation to employment. Exports created jobs and increased the GDP (Gross Domestic Product) because it expanded the global market for businesses by providing opportunities (Massoudi, n. d.). Furthermore, the data shows that U.S. exports increased to nearly $1.7 trillion and created $165,000 jobs per export (Massoudi, n. d., para. 3). Free trade has a positive impact on the economic condition because of the......

Words: 360 - Pages: 2

Premium Essay

Nz Ideology Essay

...are increasing at double the rate of inflation. Labour are planning on introducing a new agency, NZ power (Parker, D., & Mackey, M. (2011). The Labour party policy of introducing ‘NZ power’ manages to follow this ideology, as the government is prepared to fund this new agency in order for consumers to pay less money of electrical power. NZ power will act as a single buyer of wholesale electricity, it will also have the power to set prices. No longer will consumers be obliged to pay producers of cheap hydroelectric power as if they were a more expensive alternative. The pricing system would become fairer thus saving money for consumers (Parker, D., & Mackey, M. (2011). The policy will stimulate the economy as New Zealanders would save money on electricity and it is estimated that this policy’s economic impact will create new jobs. By this policy having a beneficial effect on the economy, the policy follows the ideology of social democracy, as the government puts funds into creating an agency that will help lower the prices of electricity for the consumer (Parker, D., & Mackey, M. (2011). Social democracy provides equality for the people within society. An introduction to NZ power will follow this ideology as the pricing system of electricity will become fair amongst the consumers. The policy does tend to follow the ideology of the party, by the government introducing the agency of NZ power it benefits New Zealanders. They would not have pay as much money for their electricity......

Words: 1432 - Pages: 6

Premium Essay

Farmer Case

...Case Assignment #1: The Farmer and the Landlord Group Members: Abi Erogbogbo Tierra Pearson _____________________________________________________________ Choice of Contract Structure Advising Farmer Given the volatility and uncertainty associated with farming, the Farmer will be better off with a contract that makes allowance to insure against a poor harvest and financial incentive when the harvest is profitable. An employment contract will be best for the farmer. With employment, the farmer will not be over-burdened with the financial responsibility of paying substantial monthly rent, in a month/period where his harvest has not been profitable. The agreement will depend heavily on the effort, expertise, and harvest of the farmer. This may not be a very attractive option for the Landowner, but if I were advising the farmer an employment contract will be most preferred. Advising Landowner As a landowner, my major objective is to derive the maximum profits from renting/leasing out my land. Land is a fixed asset; hence it should be able to generate a constant cash inflow for the owner. However, if the team were advising a landowner, a constant annuity (i.e. monthly rent) will be the preferred option. This monthly rent will serve as a fixed income for the landowner regardless of how well the farmer’s harvest is doing. With this contract option, the Landowner is protected from the liability that may be incurred if the farmer’s harvest results in a......

Words: 1298 - Pages: 6

Premium Essay

Trading

...Essay One In the paper The Dark Side of Trading, Dichev, Huang & Zhou (2014) investigate the effect of high trading volume on observed stock volatility controlling for fundamental information. Past literature almost unanimously states that high volumes of trading are always good as they are correlated with lower transactions costs, easier, faster and cheaper creation and adjustment of investment positions, lower cost of capital and higher prices. However one of the implications of the study is that increased trading also bring downsides that impact various market participants (investors, managers and regulators). The literature seems ignore the fact that a high volume of trading can also be destabilizing, as it injects a layer of trading-induced volatility over and above fundamental volatility. Practices like circuit-breakers employed by regulators to halt trading when prices fall dramatically sustain the fact that the market can sometimes go haywire for no particular reason related to fundamentals. Thus such policies are consistent with the view that trading can create its own volatility and it can get so out of hand that the best thing to do is to halt trading so everyone can cool off. The authors did three experiments, they used matched ETF and dual-class stocks as settings with substantial variation in trading but good natural controls for the underlying fundamental, and then they examined the aggregate time-series of U.S. stocks since 1926 and the cross-section of......

Words: 1194 - Pages: 5

Premium Essay

Trading

...When it comes to FX trading, traders have two sets of currencies that come in a pair. The fluctuations in the exchange rate between these two currencies are where a trader looks to make profit on the Exchange Market. If trader believes that the foreign currency will appreciate against the USD, the trader’s profits will rise with every increase in the exchange price. However if the foreign currency were to fall against the dollar, than the trader would take a loss. Seems simple enough, however traders have option to buy or sell that foreign currency at any time and can go both ways of the currency. So even if the foreign currency were to depreciate against the USD, the trader can still make a profit if they were to sell the dollar on the exchange market. To bring some clarity lets take a look at the Yen. If the Yen were appreciate (rises) against the dollar. A trader would than buy the Yen. By buying the Yen the buyer is also selling the dollar on expectation that the exchange price of the Yen will rise in value. The trader will than decide to close the position, selling the Yen with the exchange price higher than when they first bought it leaving them an increase in value or profit. Now if the Yen were to depreciate against the dollar, the YEN/USD exchange price will fall. That would than leave the trader with a loss as the exchange price falls below their purchase level and leave them a loss. In any trading market, the traders have the option of buying or selling......

Words: 860 - Pages: 4

Premium Essay

Trading

...For decades the rich countries of the developed world have lavished subsidies on their farmers, typically guaranteeing them a minimum price for the products they produce. The aim has been to protect farmers in the developed world from the potentially devastating effects of low commodity prices. Although they are small in numbers, farmers tend to be politically active, and winning their support is important for many politicians. The politicians often claim that their motive is to preserve a historic rural lifestyle, and they see subsidies as a way of achieving that goal. This logic has resulted in financial support estimated to exceed $300 billion a year for farmers in rich nations. The European Union, for example, has set a minimum price for butter of 3,282 euros per ton. If the world price for butter falls below that amount, the EU will make up the difference to farmers in the form of a direct payment or subsidy. In total, EU dairy farmers receive roughly $15 billion a year in subsidies to produce milk and butter, or about $2 a day for every cow in the EU—a figure that is more than the daily income of half the world’s population. According to the OECD, overall EU farmers receive approximately $134 billion a year in subsidies. The EU is not alone in this practice. In the United States, a wide range of crop and dairy farmers receive subsidies. Typical is the guarantee that U.S. cotton farmers will receive at least $0.70 for every pound of cotton they harvest. If world cotton......

Words: 1625 - Pages: 7

Free Essay

Farmer

...Troy Conley Comp 102-16 Professor wood March 7, 2016 To the Farmer in All of Us In this advertisement Dodge Ram is advertising their heavy duty trucks for the ideal farmer. The title of this ad is “Farmer” which is found on YouTube. This advertisement is 2:02 long and appeals to almost all age groups. This Advertisement would be shown before a video that had content of more a masculine attitude. Even though the ad appeals to all genders the audience would not see this advertisement before a makeup video. The target audience is men, woman, or anyone with an adventurous spirit. Because in the video the closing phrase that appears on the screen says, “To the Farmer in All of Us.” This appeals to everyone watching the advertisement. However, the audience does move towards people living in rural areas and places where farming is more prevalent. The need found is that if the audience buys a Dodge Ram Truck then they could be a farmer, but keep their normal day job. The “Farmer” ad for Dodge Trucks has made the consumer think that if they buy a Dodge Truck then they will automatically become a better and stronger farmer. In Dodge’s ad the colors are very moving, the ad does not have moving shot, its pictures going from picture to picture with a narrator describing the ideal farmer. The way dodge describes the ideal farmer is with the people they use. In the ad the people are hard workers who look like they are happy with what they do because they now that they are making a......

Words: 759 - Pages: 4

Premium Essay

Trading

...Interest Rate |   | Year 1 | Year2 | Year3 | Low |   | 8% | 14% | Middle | 4% | 10% | 16% | High |   | 12% | 18% | Trading Case B02A The spot interest rate is known with certainty, while in year 2 and year 3, there are three possible interest rates. This creates scenarios of interest rates; 9 scenarios in year 1 and year2, and 3 scenarios in year 3. As a result, there are ranges of possible fair value for the bonds.   | Year 1 | Year 2 | Year 3 | 1 | 4% | 8% | 14% | 2 | 4% | 8% | 16% | 3 | 4% | 8% | 18% | 4 | 4% | 10% | 14% | 5 | 4% | 10% | 16% | 6 | 4% | 10% | 18% | 7 | 4% | 12% | 14% | 8 | 4% | 12% | 16% | 9 | 4% | 12% | 18% |   | Year 1 | Year 2 | Year 3 | 1 |   | 8% | 14% | 2 |   | 8% | 16% | 3 |   | 8% | 18% | 4 |   | 10% | 14% | 5 |   | 10% | 16% | 6 |   | 10% | 18% | 7 |   | 12% | 14% | 8 |   | 12% | 16% | 9 |   | 12% | 18% |   | Year 1 | Year 2 | Year 3 | 1 |   |   | 14% | 2 |   |   | 16% | 3 |   |   | 18% |   | Cp Bond | Zero C1 | Zero C2 | Zero C3 | MIN | 98.232 |   | 85.852 | 72.756 | MAX | 104.426 |   | 89.031 | 78.098 | AVG | 101.285 | 96.154 | 87.432 | 75.387 | At the beginning of year 1 , Zero C1 would matured and no longer tradable. For the other three bonds, we have private information which enables us to cut out an interest rate, lefting with 6 scenarios. TRADE AT BEG YEAR 1 (interest not LOW) |   | Cp Bond | Zero C1 | Zero C2 | Zero C3 | MIN | 92.161 |   | 89.286 | 75.666 | ...

Words: 461 - Pages: 2

Premium Essay

Nz Air

...will enhance the number of opportunities for the corporations to grow. For multinational companies, the brand image and reputation play a significant role in improving the competitiveness. Air New Zealand is mainly criticized for two major issues relating to corporate social responsibility- high pay gap and environmental issues. Air New Zealand has been attacked for sharp differences in its staffs’ wages, with Chinese crew members receiving only a quarter of the salary of those from New Zealand. The comments labeling the largely state owned company as a 'flying sweatshop’ for paying its 30 Shanghai based flight attendants a quarter of what its home based crew was getting, and much less than the legal minimum wage in New Zealand(NZ Herald). New Zealand Herald reported that the Chinese received annual base pay of $NZ6,240 compared to $NZ24,000 paid to New Zealand attendants. In addition, different amount of daily cash allowance is also complained by the Chinese attendants. Climate change continued to be at the forefront of global concern and the record number of passengers taking to the skies has raised environmental concerns over planes’ contribution to climate change. Many people criticized that flying is one of the major contributors to the growing environmental pollution. �The United Nations has released a report stating that aviation is responsible for over half of the pollution caused by transportation. The report stated that emissions from......

Words: 2122 - Pages: 9

Free Essay

Trading

...extranjeras se han anulado, especialmente en los sectores de comercialización y exportación. La desregulación ha proporcionado algunos beneficios a los agricultores: en muchos países están consiguiendo un porcentaje mayor del precio de exportación de su café. El profesor Christopher Gilbert explica: “La liberalización aumenta la participación de los agricultores en el precio FOB (exportación) ya que reduce los costos en la cadena de comercialización, y porque normalmente ha ido asociada a una reducción en los impuestos y otras tasas, con lo cual hay menos posibilidades de reducción de las rentas” 20 Pero este beneficio ha llegado a ser casi inapreciable ante la caída general del precio del café. Gilbert C. (abril 2004), ‘Marketing Structure and Farmer Remuneration in Cocoa and Coffee’. Vrije Universiteit, Amsterdam. www.oxfamamerica.org/pdfs/mugged_coffeereport.pdf 20 28 Al mismo tiempo, los agricultores se enfrentan a muchas consecuencias negativas. Allí donde han desaparecido los servicios del gobierno, los mercados han fracasado en gran medida a la hora de sustituirlos: nada sorprendente tratándose de un producto básico en crisis. En un momento en que los agricultores están más expuestos que nunca a las variaciones del mercado, su vulnerabilidad se ha visto agravada por el recorte de los servicios de apoyo y la ausencia de fuentes alternativas de ayuda. El resultado es un café de inferior calidad y un poder todavía menor en el mercado. Una regulación......

Words: 62612 - Pages: 251