The swagger of Hong Kong is undeniable. Investment bankers have a certain confident uniform – and given there are a lot of them here, it is not surprising that Piguet has its highest selling shop of $30,000 – $200,000 watches here.

Hong Kong seems to successfully blend the British expat community of colonial days with modern Chinese culture. I was surprised to learn there were only about 200,000 expats in the city.

Previously a fishing village, now a financial and insurance powerhouse for Asia, Hong Kong presented us with meetings:

Westpac Group
Burra Foods Australia
Stanhay Webb (China) Ltd
Hong Kong Jockey club

For those unfamiliar with HK, a few stats:

* Mainland China’s second largest trading partner (after the USA);
* accounts for 64% of all foreign investment into China;
* Largest centre of Chinese currency (RMB) outside of China; and
* Accounts for 62% of Chinese investment into overseas assets.

The role of HK is certainly changing, as the ‘west’ becomes more comfortable dealing directly with Beijing or Shanghai – although, and it depends on who you spoke to – it seems HK may remain a key strategic foothold into the Chinese market for companies who prefer to have their financial headquarters held in a jurisdiction underpinned by the rule of law, and more ‘familiar’ than the Chinese legal jurisdiction.

There was definitely a feeling for most of the expats we met with, in business or socially, that for them, and their families, the quality of life for them was better in Hong Kong, than “Shangers” or “Bangers”… not just socially, but also because of the increasing causation links between air quality and pollution related cancers.

Westpac Group

An investor in the Nuffield Scholarship program in Australia, it was fantastic to meet Andrew Whitford, Regional Head of Greater China, Westpac Group. Having lived in Shanghai for a number of years, Andrew’s insight into a complex and culturally sensitive business environment was evident.

Whitford provided solid statistics not only on the interaction between mainland China and HK, but also the current and future state of Australian and Chinese trade, as well as New Zealand and Chinese trade.

Given the significance of Chinese – representing nearly 40% of Australia’s total sales, the export of Australian agricultural product to China amounts to just over AU$10Billion (as at 2015).

The impact of the Free Trade Agreement which came into effect December 2015 – negotiated by Andrew Robb on behalf of the Coalition – is a serious game changer for Australian farmers. Getting your head around the broad brush stokes of the FTA is essential reading, especially as the deadlines when some of the dairy tariff reductions come into play – effectively increasing the competitiveness of the Australian dairy industry to stay head to head with our Kiwi dairy stalwarts over the ditch and the impressive quality of Ireland and the Netherlands.

I could write all day about the ability for an Australian farming family to fundamentally change their business if they decide to take direct advantage of ChAFTA. My Nuffield Report is looking at financial literacy of Australian farmers, and after 2 weeks of looking intensely at the Chinese market, I think every Australian farmer should hop on a plane to China and see first hand the opportunities and potential “pain points”. Australian farmers who bank with Westpac have an extraordinary Lilly pad with Whitford at the helm of the Chinese operations…

Burra Foods Australia
Meeting Dale O’Neill, General Commercial Manager was a perfect segway after the Westpac big picture introduction into Australian agricultural exports into the Chinese markets: Dale is leading the charge of high quality dairy ingredients into the Chinese market. Based in Hong Kong, Dale moved his young family from Victoria recently after the Victorian dairy company successfully entered a Joint Venture (JV) with a consortium of Japanese and Chinese interests.

Dale represented what we later learned in mainland China was the key to successful business into China – you need to have a local presence, and keep your finger on the pulse. Market demand for product can change quickly, and if I was a dairy farmer supplying milk to Burra Foods Australia I would be celebrating the successful inroads Dale and his team have made into the Chinese market.

A good amount of the presentation with Dale would be information I consider commercial in confidence, so I provide a picture of Burra’s inspiring business vision. I am excited to see where this company goes in the next decade.

Stanhay Webb (China) Ltd
John and Sally Evans are an English couple who represent that next layer of the reality of doing business with China. Stanhay Webb manufacture precision planting gear and would revolutionise the cropping potential for Chinese farmers. Again, commercial in confidence material, so I note John here as an example of some of the challenges that can be faced entering the market. They were extremely generous with their time and insights and I’ve made a note to look at their gear for next time we need a new planter as they supply Australia and NZ.

Hong Kong Jockey Club

We accepted an invitation to be trackside at dawn at the Hong Kong Jockey Club to see horses being worked in readiness for that nights race.

I can now see why James Packer had a serious crack at the Asian gambling sector.

The Hong Kong Jockey Club had $13.7Billion in race takings go through the till. For one racetrack. When you compare this to the race takings for all the horse races in the USA ($10.6Billion), it gives you a fair idea of the love the Chinese have for gambling.

We flew out of Hong Kong for Shanghai, where my next blog begins: Nuffield Blog #6: the return of the world’s mightiest Empire: China.

We swapped Singapores’ sweaty plastic corn for The Phillipines, where the corn was a week old, but still sweaty.

I was introduced to the concept of a ‘wet market’ by Clare Bagshaw, in her excellent novel “A China Moment”. Wet markets are your original feudal, agricultural market system where for centuries, if you had surplus milk, meat, vegetables etc after feeding the family, you would hitch your horse or bicycle, throw the produce on the back (wrapped in wet hessian) and travel pre-dawn from your farm to the local village centre.

Traditionally, the farmers would sell their wares at dawn to customers looking for food for the day (noting no refrigeration or electricity in many homes until quite recently).

So it was, at 6am at a cool 35 degrees and near 100 humidity, 9 scholars bundled into the mini-bus to head to the Los Banos wet market. Dr. James Quilty was our host, and expertly guided us past meat vendors cleavering away at meat not yet set, glorious fruit and vege and stalls of grains, pulses, rice and other starches. The five senses were ignited with a bang, with a nearby tuk tuk backfiring as we headed into halls of meat and fish displayed on football size ice bricks. The pictures are the best way to give you a glimpse of the market in its raw form.

Dr Quilty, a terrific Australian who arrived in The Phillipines to do his post-doctorate studies on rice (having spent time near Dubbo on Cotton for his PHD), was a consummate host. He had clearly fell in love with the place, having stayed nearly 4 years longer, now with 2 children, than his intended 3 years with his lovely Australian wife. Now the manager of IRRI (the International Rice Research Institute), it was interesting to hear the Quility’s talk about the Filipino health system being far better than his experience of the Australian health care system (caveat being you needed to be an expat or wealthy to access the good Filipino health system).

We read in the local newspaper the Prime Minister was running a quasi dictatorship through spurious drug supply claims against outspoken Senators who were placed on house arrest. After we left, a police officer on a motorbike was shot at point blank range, during his daily traffic management. Southern parts of the islands were involved in daily air raids whilst we walked through rice paddies (mum… they were 1200km away). After we left, martial law was declared for some parts of the islands. We read about wealthy Filipino families (some of which were previous Prime Ministers), who bribe the local police to ‘clear the way’ of choked traffic jams of Manila or who transport themselves around by helicopter.

We toured Corregidor Island, one of the important historic sites in the Philippines. A brief summary of the history of the Philippines: came under Spanish sovereignty in 1570, and then 328 years later in 1898, as the spoils to the victor of the Spanish-American War, the Americans added the Philippines to its colonial reach. Corregidor Island became the military reservation, complete with 4000 solider barracks, 2000 officer barracks, convalescent hospital, military stores and corridors in the Malinta tunnel. The yanks spent USD$150 Million in 1902 in concrete, mess halls etc.. (to put that amount of  USD into perspective, that amount is USD$4.054 Billion dollars in 2016 taking into account inflation).

I mention the role of the US and Japan in the Phillipines as the legacies from these battles are an intrinsic part of current day Filipino business culture. Tales of crying babies being thrown into the air onto the bayonets of Japanese soldiers, and the graphic art work depicting the rape of women and slaughter of millions of Filipinos, are a sobering reminder of war.

IRRI was established in 1960 through joint donations from the Ford and Rockefeller Foundations and the government of the Republic of the Philippines. Significant funds for infrastructure and buildings were also contributed by the Japanese government (perhaps an acknowledgement of the brutality during the war?) Assistance from the Bill and Melinda Gates Foundation, Filipino and international governments and universities enable this massive research facility to continue.

Employing 1,200 Filipino employees, as well as 1,000 contract farm workers, IRRI is now at a cross roads. Local people do not want to undertake the manual, intensive labour of planting and harvesting rice and other research crops in 35 degree temps and near 90% humidity. Parents actively dissuade their children from choosing agriculture as a career option, considering it peasant work.

Combined with outdated 1960’s rice field infrastructure now incompatible with modern mechanisation (some fields being 20m x 20m, complete with piping to flood and remove irrigation), the cost to upgrade the research facility to the 21st century is a huge issue, especially given this is the crop that can and does feed the world during food shortages.

(I recommend reading about the correlation between food shortages and military escalation, and the role that international aid plays in securing food supply, and decreasing armed conflict. I wish I had the gumption to supply these articles to the Facebook warriors who complain about wealthy Australia providing aid to people in dire circumstances.)

We were given the quite extraordinary chance to become rice farmers for the day! From ground preparations using the water buffalo lovingly named “Gertrude”, to a paddle style plough, to fully mechanical rotary hoe – it was simply bewildering the difference in the work required to prepare the ground.

Next stop was to level off the prepared ground (similar to a harrow style process to generate a fine seed bed). Then we used a bamboo guiding device to ‘draw’ lines 20cm apart in a chequered pattern in the mud – which we then hand planted one rice plant in every square. It was backbreaking.

We then had a go on the new mechanical planter – wow! I have a new level of respect for our air-conditioned John Deere cabs with GPS guided precision planting systems…

On a lighter note, our youngest scholar in our group, Dutchman Rick, a strapping young man in his prime years, took advantage of the situation to obtain some new Tinder profile pictures. He is the little brother of our group, and his boundless energy and cheerful disposition are cherished.

Close to IRRI, is the International Rice Genebank Collection Information System. Significant statistics about this facility can be found in the pictures included here. The facility spends nearly $10M in electricity costs to maintain the integrity of the seed storage facilities!!

Two of the functions of facilities various roles are to:
1) ensure there is seed stock available to re-seed rice crop populations in the event of natural disaster, global food crisis due to pest infestation or some other large scale global pandemic crisis; and
2)assist plant scientists in their breeding programs to develop rice varieties which can better tolerate drought conditions…such as work undertaken by Australia’s CSIRO to attempt to create a C3 crop into a C4 crop (through manipulation of the germ plasm). We saw a plant research station in Beijing using the IRRI rice seed stock.

There is so much more that can be said about our time in the Phillipines, including the tale of an extraordinary young entrepreneur (who I will include in my formal Nuffield Report, as an example of financial literacy converting ordinary to extraordinary).

So many possibilities for serious potential, but such adversity in realising this potential.

At the time of writing this blog, the Dept of Ag, 10 story building in Brasilia, the capital of Brazil was burning after a 35,000 person strong rally calling for the resignation of corrupt politicians.

Whilst the Phillipines hasn’t had a Prime Minister choppered out after an internal uprising for a few years now, I’d say agricultural advancements – and food security will follow only as political systems deal with corruption.

My parting image of the tale of two economies in The Phillipines was the image of small shanty style housing about 50 metres from the international runway our plane departed from….

In my next blog, we enter the financial gateway into China, Hong Kong. Nuffield Blog #5: Nuffin” like the rule of law to ease worries

Our first day in Singapore involved an early rise at 5am for a walk – I was keen to see the city awaken and come to life. The only problem with this noble intention was to fail to realise sunrise wasn’t until 6.30am, so I navigated the deserted streets with my trusty iPhone torch! Intrigued to watch the street sweepers spray recycled sewerage water on main roads (completely clean, innovative way to recycle water..)

Humid and a warm 36 degrees at 6am, it was like a walking in a sauna. Beautifully manicured gardens, clean swept streets, soulless high street labels blinking ‘success’ from their windows. A quick stop at a corner shop revealed sweet corn, shrink wrapped into bite size chunks. Sweaty corn, wrapped in plastic oozing a yellow colour too perfect to be natural. It seemed to me a perfect metaphor for Singapore – beautiful and well packaged, but sweaty, imported and devoid of nature.

 

Well known for strict regulation through tightly controlled government (ie, we read about commonplace practices of rehousing the homeless or disability, being quietly shipped off to an institution for ‘rehabilitation’), from first impressions.. Singapore appears to marks its success through visual measurements – cutting edge architecture, immaculate personal grooming and the skill of polite queuing or walking whilst watching video games on a smart phone.

Singapore is a tiny island – totally reliant on imported product to feed, cloth and house its people –  has made a fortune in the margin business. A shipping port where large ships from the West would arrive, be unloaded and their cargo repacked onto smaller ships to enable their safe passage into the small or shallow ports of Asia.

The future of Singapore’s shipping container trade is bearish, with China deepening its ports to allow direct trade from port to port and skip the Singapore ‘decanting’.

Our days in Singapore were filled with briefings from Nuffield Australia and informative presentations with NCI Brokers Asia PTE LTD, ANZ bank and Syngenta.

Stuart Anderson, CEO of NCI Brokers Asia PTE LTD (NCIB), addressed the 30 Nuffield farmers and agribusiness professionals from 9 countries about the practical issues for producers looking to access export markets directly.

Whilst most Australian banks offer a trade credit facility to Australian farmers looking to directly export product overseas, Stuart has more than 20 years of experience in the insurance/trade credit game, mostly in Asian markets.

The cultural differences in how a “western/European” vendor supplies product and their expectations about payment terms compared to an “eastern/Asian” paradigm appear to be an implied trade barrier. For example, if our small family farm were to negotiate a supply contract for Adzuki beans into China or India, whilst a contract might specify the quality specifications, and terms of payment – there could be markedly different interpretations from the buyers perspective. Agreed payment terms of 90 days upon receipt of product on the dock in Singapore or Shanghai, could stretch out to 18 months… This is where Stuart steps in.

Of particular interest to our Ag business was Stuart’s service of undertaking due diligence on behalf of a proposed supply contract. Eg. Where the Australian farmer wishes to supply chilled beef to a province in China, Stuart can access a significant database for a small price of $30/search, and ascertain if there have been historical issues from other vendors having product returned/ payment being late or if prosecutions were required to enforce contract performance.

ANZ Bank‘s presentation was largely commercial in confidence so I can’t say too much. It was fascinating to observe the difficult dance of an Australian bank – a business seeking to make profits – navigating their corporate social responsibility in the space of emerging markets. With 5 floors of prime office space in Singapore, if you were an Australian farmer banking with ANZ, the resources available to you to gain insight into the Asian market are impressive.

Syngenta was also a presentation exploring commercial in confidence topics, but the array of ‘corporate speak’ was a great stand alone lesson for any Australian farmer looking to sharpen and update their dictionary of management terms!

On a serious note, and already a hot topic in Australia, is the intellectual property of farm data, such as yield mapping, input rates, spray and harvest records. As big data increases its role in the farming sector, the value of the knowledge and data of an individual farmer or their business (I believe) becomes a tangible asset. Should this knowledge be passed to a corporate giant for product development for free? Would Syngenta give away the recipe to Gramoxone? The process of “equal value exchange” is a difficult conversation, and certainly one for our industry bodies to address before the value of the farmer’s IP is gone.

For me, our visit to Singapore was a tall of two cities: ex-pats and highly skilled professionals expertly navigating trade and finance, and the story of Hannah, a Filipino nanny who I sat next to on our flight from Singapore to The Phillipines. Hannah had been a nanny for an ex-pat couple for nearly 4 years, having looked after their baby from 6 months of age. Hannah has a husband and 12 year old son in The Phillipines and had returned home once in 4 years to see her family. She was paid $USD1,000/year (in addition to her board etc). She was devastated to leave the boy she had raised as his nanny. She was worried she would not recognise her own 12 year old son at home. We spent the 4 hour flight talking about how lucky the ex-pat couple was to have her assistance for 4 years whilst she sobbed and mourned the loss of the little boy she would never see again.

In my next blog we get muddy and plant rice in The Phillipines: Blog 4: The Phillipines – Will we have Nuff’ food?

On the feminist scale, I’m more on the Annabelle Crabbe end of the spectrum than Germaine Greer, so with that disclosure out of the way, I decided it was important to write a blog early on about what it means and feels like to be a woman in the Nuffield journey. I feel Jim Geltch, Jodie Dean, their team and the Nuffield Australia Board have quietly tried to encourage more women to apply in what has historically been a very prestigious, white, and male experience.

In September 2016 when the announcement was made as to who were the lucky recipients of the 2017 Nuffield Scholarships, I was overwhelmingly confronted with looks ranging from bewilderment to celebration to scorn.

Without a doubt the good ol’ Australian Tall Poppy Syndrome was alive and well. I was told with earnest warning that it would lead to imminent divorce and that our farm business would suffer and we would join ‘the queue of ex-Nuffield Scholars who sold their farms’ on completion of their studies.

I was quietly warned it would cost me $100,000 in addition to the generous bursary Rabobank had invested in my scholarship.

My law colleagues raised eyebrows and asked if I had left the legal profession to become a professional farmers’ wife, complete with late model Toyota Landcruiser, to refine my Victoria Sponge baking skills and ‘help out’ in the house and farm office.

A few people asked me how I could possibly leave my young son behind whilst I was jetting around the world on what they considered a junket trip.

Personally, I was shocked I had succeeded in jumping the 3 stage interview process (8 penetrating person panels). My gorgeous husband was not surprised at all – apparently I present more confidently than I feel on the inside. However, when the reality of 16 weeks of travel really began to sink in, my husband concluded we were both slightly mad to have even contemplated this journey, but now we were here, all he asked was I return with more confidence and if possible deliver a financial return to our farm business from any additional costs, lost income and time away from home, him and Lachlan. I promised that our business would never look the same again…

The truth is, it had been a bucket list item for me. Some people dream of bungee jumping or climbing Mount Everest, but for me, a Nuffield Scholarship was a vaguely unattainable title, reserved for the very best of farmers.

My old tennis buddy from my Goondiwindi days, Nigel Corish, was a 2014 scholar and I had quietly watched as a junior lawyer (before we bought our farm), how Nigel quietly transformed after his Nuffield journey. He was always a well respected operator, but now he is a leader in his community and industry. Humble, quietly spoken and chasing excellence in his field. They say imitation is the highest form of flattery, so I thought I should apply. Lachlan was 12 weeks old when I applied. I knew he would be 1 when I left, and would be 16 months old by the time I finished. The child psychology text books told me he wouldn’t notice I was gone so long as we had consistent people in his life who he knew well. Enter side left Catherine, our Nanny. Together with my parents and Brendan’s mum, we created a spreadsheet for Lachlan’s wellbeing which would make an accountant smile. Seriously organised, groceries pre-ordered, babyfood for months stored in the freezer, a gardener and extra help on the farm and a community of supportive neighbours and friends, I felt we had it covered. In fact, when I got back after 26 nights away in Brazil, Brendan and ‘team Lachlan’ had done such a great job I was bloody redundant! Their new routines worked much better than mine and everyone was happy. Lachlan had stopped saying ‘mumma’ and ‘dada’ was everything, but after a week things returned to normal and it was as if I had never left.

For me, as a new mum, business woman and lawyer – I feel the greatest gift I can give our son is the best education money can buy, and a business which in 30 years time creates options. An option for our children to either continue in primary production, or passively invest in real estate. To ensure in 2047, our farming assets were of a size, type and quality which corporates, hedge funds or super funds would pay a premium should none of our children wish to continue in agriculture.

This is my vision: to look at the businesses and meet their people from around the world, and find out how we can transform our business from a typical ordinary Australian farm business to an extraordinary enterprise which creates options (code for seriously profitable), a happy, healthy family and employees, a sustainable environment and the ability to contribute to our local community.

I’m particular interested in the role that financial literacy plays in the transformation process of the typical Australian farm business (and this is the tangible direct focus of my research). Whilst I’m looking at balance sheets, business strategy and talking profit, I’m also keeping a close eye on succession, estate planning and the transfer of knowledge between the generations. As a lawyer working with a lot of farming families and their succession challenges and joys, the profitability of the farming enterprise is without doubt the key to a successful transition from one generation to the next.

Rabobank were interested in this vision and funded my Nuffield scholarship. Rabobank are not our bankers, but the Dutch multinational banking and financial services cooperative has always interested me in their pursuit of R&D, integration of succession with financial management and flexible banking products for the volatile farm business model.

I am extremely grateful that Rabobank supported not only my scholarship, but also Nuffield Australia as our lead sponsor.

So together Rabobank, my beautiful husband Brendan, Catherine, my parents, Brendans’ mum, our farm team, friends and neighbours have made this journey possible. It is absolutely the case that a village raises a child, and in this case it has also enabled a woman with a young son to tread where few have gone before.

The law firm in Dubbo is patiently waiting my return on 17 July 2017. In a world where female lawyers have ‘career slowdowns’ during their child-bearing years, actions speak louder than words: I’m extremely thankful when I asked to extend my maternity leave from 12 to 18 months, they didn’t throw my computer through a window!

In my next article/blog we get down to business: Blog 3: Singapore – leaving Nuffin’ to chance.

I’m currently sitting on a plane racing towards Manila, The Phillipines for the second leg of our Nuffield GFP. I’m overdue to write about my Nuffield journey so far. So here goes – this article is purely based on my own observations and experiences, and I will kick off with a background explanation of what “is” a Nuffield Scholarship.

The Nuffield Scholarship program has four components:

The Contemporary Scholars Conference (CSC) – this year in Brazil;
The Global Focus Program (GFP);
Personal travel either alone or with family; and
Membership to the Nuffield Alumni and the fellowship of scholars generated since the 1950’s.

This article deals with the GFP.

The GFP is a 6 week tour around the world looking at all aspects of the Agricultural and Agribusiness sector, including:

research and development;
production on farm;
logistics from farm gate to processing;
manufacturing of raw farm commodity to finished product;
marketing and consumer demands for food, fibre, oils and plant based pharmaceuticals;
the interplay of finance, currency, markets and insurance;
the people who are involved in the aforementioned, including owners (family-scale to corporate), employees, and stakeholders; and
subtly, the unspoken impact of government regulation (either too much or too little), cultural quirks, historical legacies and bias (including ethnicity, race and gender) and the time-old tension of who gets what % of the Trillion dollar global Agriculture/Agribusiness sector.

Nuffield Australia developed the GFP as a way for Australian farmers to gather perspective on the Australian agricultural sector in global terms. In recent times, Nuffield Australia has invited other Nuffield countries (such as NZ, UK, Ireland, Canada, USA, Netherlands, South Africa and Brazil) to have their scholars join the Australians on tour.

Each year there are 6 GFP’s. Chile, Brazil, Africa, Japan, China and India. The first 3 leave after the CSC in March, the last 3 commenced their GFP on 8 May 2017 from Singapore. There are about 9-12 scholars on each tour plus an in country host or translator.

I was lucky to join the China GFP. During our 6 weeks, we will visit Singapore, The Phillipines, Hong Kong, China, Germany, Netherlands, UK and the USA. Instead of returning to Australia when the China GFP finishes on 22 June, I will stay in California and then be joined by my husband Brendan and 14 month old son Lachlan. We will then spend time in the USA and Canada.

Our GFP has 2 Aussies, Councillor Dan Meade (Grazing and Dairy in Victoria) and myself. Kiwi Jason Rolfe works in farm insurance by day and is part of a family dairy farm as time permits. South African Thato Moagi is a mixed farmer, trainer and consultant. Nicole MacKellar is a high-flying marketing manager and involved in her familys’ mixed farm business in Ontario, Canada. Dr. Georgie Crayford is a senior policy advisor for the UK Pig Association and together with UK Dairy specialist Iwan Vaughan represent the UK contingent. Dairyman and grazier Eamon Sheehan brings hilarious Irish relief, whilst super-smart Dutch student Rick Batts brings youthful vigour.

Together our group of 9 scholars will attend 67 presentations and meetings, plus farm visits and see a few cultural/tourist spots along the way. There are 3 ‘rest’ days built into the 6 week program – one of which is spent flying 18 hours – so it will be a marathon journey.

Nuffield Australia undertook briefings this week in Singapore on psychometric testing for team roles (Belbin) and stress testing to assess if any member of the team has high levels of stress due to external pressures. Our group were encouraged to develop ‘ground rules’ and strategies on how 9 complete strangers can happily co-exist together for 6 weeks with limited sleep, high-level presentations whilst writing your 10,000 word report which we are encouraged to type up whilst travelling.

My report is due 8 January 2018. Danny and I with the other 20 Australian Scholars present a 20 minute presentation in Melbourne in September 2018 on our report. This presentation is recorded and published through the various social media platforms.

In my next article, I will explore why a country lawyer with a young baby decided to apply for a Nuffield Scholarship.