Ballance, the $1 billion co-op

Ballance Agri-Nutrients is a farmer-owned co-operative supporting New Zealand farmers to operate more productively, profitably and sustainably. CEO, Mark Wynne reflects to NZ Manufacturer on the way ahead and staying close to farmers.

We’re close to a $1 billion business with roots that go right back to the 1800s when sulphur was mined at White Island in the Bay of Plenty and shipped to Tauranga for refining. Across our long history, our reason for being has remained the same – ensure farmers have sustainable, affordable access to quality nutrients to support their farm’s productivity.

From our core business of fertiliser manufacturing, supply, sales and advice, we have grown to offer farmers a full suite of science-backed nutrient products and services. This enables us to help farmers achieve soil and animal nutrition and productivity with a minimal environmental footprint.

Our agri-nutrient advice is complemented by award-winning technology products which provide a wealth of information to enable farmers to make the best management decisions for their business.
We cover the country, with one-on-one specialist advice on-farm backed up by a network of rural merchant supply partners, services centres, consignment stores, manufacturing sites and our own agricultural aviation services.

As a co-operative, we’re owned by farmers and they share in our success receiving annual rebates on fertiliser purchases, a share in our profits through dividends and increases in the value of their shares in us. In 2015 we distributed $76 million to shareholders. We’ve gone from strength to strength with more than 19,000 farmers signed on as shareholders. Our shareholders’ equity is $435 million and has grown by 31 percent over the past five years.

Made in NZ for NZ
We source raw materials from around the world and within New Zealand to produce high quality farm and animal nutrients designed for New Zealand soils and farming conditions. Last year we sold 1.75 million tonnes of product and these sales, combined with other services, delivered $893 million in revenue and an $81 million profit.

In our core fertiliser operations Ballance has two plants that manufacture phosphate fertiliser products at Mount Maunganui and Awarua. Together, the plants produce approximately 800,000 tonnes of fertiliser each year.

Manufacturing processes are continuously revised to ensure optimum efficiencies are achieved. Our continuous improvement is delivering results, with Awarua achieving record production levels last year, while Mount Maunganui achieved the lowest controllable unit costs for production.

Ballance also owns the country’s only ammonia-urea manufacturing plant, located at Kapuni, in Taranaki. This high-tech plant operates to stringent international standards, converting atmospheric nitrogen to ammonia and then to urea. The natural gas used to power this plant is sourced from the nearby Maui gas field. Kapuni produces around 260,000 tonnes of product annually. Ballance is currently exploring development and funding options for a new plant aiming for the lowest carbon footprint of any similar facility in the world.

All manufacturing produces byproducts and fertiliser is no exception. We turn these into revenue streams. A good example is Go Clear, an exhaust system additive which reduces nitrogen oxide emissions from diesel engines and is used by many fleet operators including Fonterra. Scientists have calculated this additive has removed 2,000 tonnes of harmful exhaust gases from the environment.

To fulfil the growing demand for high quality animal feed, we have manufacturing sites in Morrinsville and Wanganui in the North Island and Ashburton in the South Island. Our SealesWinslow operation supplies custom blended pelletised feed to farmers throughout New Zealand. In addition the company produces feedblocks, milk additives, silage inoculants and mycotoxin neutralisers.

In order to maintain product quality, the mills have developed effective quality control systems that cover raw material sourcing, formulations, manufacturing, storage, transport and finished product testing. All sites have FeedSafeNZ accreditation which provides assurances on the quality of stockfeed.

Backed by Sound Science
Everything we do is backed by sound science. Our R&D team focuses on the development of products and services that improve the efficiency of our soil and animal nutrition products and our technical team ensures the best scientific advice is put in farmers’ hands.

This includes have specialist teams of scientists in key areas like animal nutrition, soil and agricultural science to advise farmers.

We work in close association with AgResearch, HortResearch, Crop and Food, Landcare Research and independent scientists, drawing on their expertise as we contribute ours. Our work includes research in local conditions to provide the results evidence farmers look for in the products we recommend.

We’re just past the half way mark in our seven year $19.5 million Clearview Research Programme which has funding support from the Primary Growth Partnership. Its overall aim is to increase the efficiency of fertilisers farmers depend on while minimising their environmental impacts.

Two patented products are already in use on farm – N-Guru™ and SpreadSmart™. Used in conjunction with soil testing, N-Guru™ enables farm consultants to interpret the test results to identify which areas of a farm will produce a greater response to nitrogen than others. SpreadSmart™ meanwhile is precision technology developed for fixed-wing aerial topdressing. It combines GPS guidance and tracking systems with computerised farm mapping to automate the opening and closing of an aircraft’s fertiliser hopper at the right time, in the right place, minimising losses and maximising results.

It keeps fertiliser out of waterways, gullies, forestry blocks, tracks and other no-go zones and allows for different fertiliser products to be specifically targeted to different areas of the farm, improving overall production. It also combines variable rate application, so different parts of the farm get exactly the volumes of fertiliser they need. With fertiliser one of the largest on-farm costs, precision applications also mean budgets go further, improving farm margins.

Serious about Sustainability
Farming means everything to us. Farmers are our owners and our customers and their work contributes to the New Zealand economy. We’re big investors in farming’s sustainability.

We’re the lead sponsor of the Ballance Farm Environment Awards which show productivity and profitability don’t come at the environment’s expense. This is more than a farming competition. It’s about supporting the global competitiveness and reputation of our pastoral industries. New Zealand could produce enough food to feed around 40 million people if every farm performed at the same levels demonstrated by our award winners. We think that’s well worth supporting.

Farming is often an inter-generational business. We provide up to four scholarships a year to encourage young people to enter the agricultural industry. Each scholarship is valued at $4,000 per annum and can be held for a maximum of three years.

Proud of our People
Ballance employs more than 700 people in a wide variety of roles, ranging from PhDs in agricultural science to chemical engineers, marketing experts, health and safety specialists and production workers. Great people made a great company, so we emphasise attracting and developing the best people we can find.

We’re firmly committed to developing leaders worth following and giving every employee the opportunity to be the best they can possibly be.

Every day we strive to make our operations a safe place for both staff and visitors and we are committed to a zero injury rate. Attention to safety has earned us the highest level of ACC accreditation.

Future Outlook/Opportunities
If we’re not thinking about the future, we can’t help farmers prepare for it.

Farming in the future will look pretty different. We will see more consolidation – bigger farms, and they will be working within tighter limits – think controls on water takes, nutrient losses, animal welfare – some of these limits will be via legislation, others will come from consumer pressure.

In response to this, we’ve focused on three areas: firstly, staying close to farmers, understanding their needs as market changes rapidly around them. Secondly, delivering best advice for farmers can remain sustainable and profitable as limits increase and change. Thirdly becoming involved in the legislative process, advocating for farmers and ensuring sound science is behind limits.

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