5 Aug 2014

Foreign farm ownership register call

8:06 am on 5 August 2014

Federated Farmers has renewed its call for a register of foreign-owned farmland, after questioning the proposed sale of a central North Island farm to a Chinese company.

The Shanghai Pengxin group has signed a purchase agreement for the 13,800ha Lochinver sheep and cattle station near Taupo. It plans to convert part of the property to dairy farming.

The group already owns 29 New Zealand farms, including 16 farms formerly owned by the Crafar family.

The sale still has to be approved by the Overseas Investment Office (OIO) and Chinese regulators.

But Federated Farmers president William Rolleston said he was uneasy about the proposed sale and asked whether it would provide the level of benefit to the country now required under overseas investment laws.

The proposed sale highlighted the need for research into the extent of overseas investment in farmland, as well as a register.

"This is important for a couple of reasons. One is that the OIO puts conditions on foreign owners and if we don't have a register I don't see how we're going to follow up those conditions and make sure they've been satisfied.

"The second thing is, farms come and go in foreign ownership in New Zealand and so it's important to see exactly what the extent of this issue actually is.

"And I think that if we had a register, we would see that there probably isn't as much farmland in foreign ownership as the public think there might be - and that might take a lot of the political sting out of this particular issue."

Dr Rolleston said Australia was a step ahead of New Zealand and the government there was working on a farm register.

First delivery for Oceania Dairy

Meanwhile, a Chinese-owned dairy company in South Canterbury has received its first delivery of milk this week as it completes testing at its new plant.

Oceania Dairy, which is owned by China's biggest dairy producer Yili, has nearly finished building a $214 million milk processing plant at Glenavy.

Oceania Dairy has 48 farmer suppliers and eventually plans to process 300 million litres of milk a year at the plant - turning that into 47,000 tonnes of milk powder for export to produce infant formula.