with Bill Webb
Bill Webb Feed Solutions
It’s a matter of keeping an ear to the ground and one eye open as environmental pressures, inflation and Covid-induced supply issues compete.
On the flip side, an anticipated record payout from Fonterra and good prices for meat look set to offset rising costs.
The weather in recent weeks has also given farms in the area a boost.
At our yard in Paengaroa there was 132.5mm of rain over the December 1-15 period, compared with 38.5mm last year.
The December rain also helped push the six-month rainfall figures up this year with 596mm falling between July 1 and December 15, compared with 505mm for the same period last year.
Soil temperature readings tell a story and it was sitting at 21.02 degC on December 15, compared with 18.1 degC at the same time in 2020. That’s a huge difference and it’s why we are growing so much grass.
The pay-out is looking good with $8.40-$9.00 announced on December 1. Farmers will want to make the most of that with feed and supplements and milk them on for as long as they can. Make sure you have plenty of feed to carry you through.
It is easy to think you are comfortable, but it can change in those hotter, drier months.
At the sale at Rangiuru on December 14 the 400kg steer store price was still fetching $3-$3.10/kg which is strong. This time last year was under $3, and the beef schedule is still about $6 which is the strongest it’s ever been, I think.
Autumn born steers were at $3.65/kg so still fetching good money. The kill is up five per cent on last year so there potentially could be less stock.
There was a good penning of sheep at Rangiuru too, fetching reasonable prices as well.
Prepare to diversify
Farmers need to be able to diversify. There is news of a new oat milk factory in Southland being set up for this coming year by some locals down there, out of an old factory. That was traditionally sent offshore to make oat milk.
There is a bit of a swing away from barley into oats so there could potentially be a shortfall there.
In addition to that the Green Party is putting a proposal to ban palm kernel from 2026 so if they get their way there will be no KFC for cows, no easy fix.
They will have to look for alternatives and there could be more demand generated for New Zealand grown produce which is what we are trying to do. We can keep our carbon footprint down by producing our own.
It is interesting that the government is putting money into seaweed farming. A lot of fertiliser is made out of seaweed. It’s low carbon and organic which everyone likes. A lot of overseas buyers are looking at the carbon footprint.
There are some interesting things coming up in the next few years and farmers need to be aware and watching what’s going on there. An informed person makes better decisions and does better planning than one that is uninformed.
If palm kernel can’t be used the first thing that will happen is farmers will reduce stock numbers and that will play into the Government’s hands too actually.
There are a lot of sheep and beef and dairy farmers planting out their wetlands, fencing off wetlands, retiring land to the crown. The problem is the big cost to farmers, they are losing ground and it’s costing money too to fence off and establish these wetlands.
About 8-10 months ago I talked about the Covid cliff where everything was going along nicely and then everything was going to fall off the edge and things were going to get hard to get hold of and prices were going to go up. Well, we have hit that now and if we have another round of Covid lockdowns to get through, it could get worse than it is now.
Parts, machinery, staff, labour, imported fertiliser, chemicals. We are going to have to play the futures market a little bit and ensure we keep enough supplies on hand.
Machines are parked up because people can’t get parts. It’s real disruptive to the economy.
I’ve still got a bit of silage and hay to be done over the next 2-3 weeks. We will be gearing up for our maize harvest in February.
We wish everybody a happy and prosperous New Year and all the best for the coming season. It’s going to be an interesting 12 months ahead but it’s looking good anyway with the weather, grass and pay-out.