A long spell of dry weather and the high dollar are causing
"a deepening pessimism" to spread among sheep and beef
farmers around the country.
Federated Farmers' latest Farm Confidence Survey shows any
lift in the overall mood of farmers around the country is
largely confined to the dairy sector.
A major split is opening up between dairy and the rest of
pastoral agriculture, said Federated Farmers president Bruce
"It is encouraging that dairy farmers are more positive than
six months ago, but the deepening pessimism of meat and fibre
and our grain farmers is concerning."
Rising global dairy prices and upward revisions in payout
forecasts have helped the dairy sector regain a little
confidence in the wider economy and their own profitability,
"On the other hand, in the sheep, beef and grain sectors,
confidence continues to sink.
"Meat and fibre farmers have seen prices reverse while the
high dollar erodes what they ultimately get paid."
While good rain saw farmers' production sky-rocket last
season, this year's dry run means sheep and beef production
will likely be down.
"Sheep and beef farmers cannot increase production to offset
lower prices and the high dollar," Wills said.
"As the survey was in the field in the first half of January,
the current dry spell will be of mounting concern."
Adding to farmers' woes, beef prices last week dropped ten
cents per kilogram, lamb prices are currently about 35 per
cent lower than a year ago, and wool is also struggling.
And although dairy farmers are feeling less pessimistic than
six months ago - with farmers expecting to increase
production and spending - the mood is far from upbeat.
"What dairy farmers are saying is that they are less
pessimistic but this is not the breaking of a new dawn,"
Another issue which emerged from the survey was a growing
sense of frustration about filling skilled vacancies.
"All farmers agree they are struggling to find skilled and
motivated staff and this seems odd given unemployment
figures," Wills said.
"Skilled and motivated dairy staff are especially hard to
find so is there a mismatch between where people live as
opposed to where the jobs are?"
Feds' meat and fibre chairwoman Jeanette Maxwell said the
fact that some farmers were getting low returns on stock did
not mean there was a need to cut overcapacity. The sector
needs to keep growing and fill global markets.
The $65 million Collaboration for Sustainable Growth
programme announced last week could "supercharge" New
Zealand's red meat exports, she argued.
Growing and filling global markets would, in turn, create an
industry that young people aspired to, Maxwell said.
The Farm Confidence survey, which is emailed to all Feds
members, was carried out in mid-January and attracted 973
responses. It is conducted at the start of the new season in
July, then at the mid-season point in January.
- Ben Chapman-Smith of nzherald.co.nz