Tuesday, 27 February 2024 06:55

Tough times on farm

Written by  Sudesh Kissun
Beef + Lamb NZ chair Kate Acland. Beef + Lamb NZ chair Kate Acland.

Beef + Lamb New Zealand chair Kate Acland says while farmers are quite positive about the new Government, the economic situation on farm is "pretty brutal".

Lamb prices are 20% below their five-year average and mutton prices down 15%.

"There is optimism around the Government but there's a lot of pain in the sector," she told Rural News.

"I think we will come out of this - the medium to long term view is quite positive."

Acland points out the B+LNZ's economic service analysis shows that sheep farmers are facing their lowest year of profitability in 15 years.

There are a number of factors affecting NZ lamb price. Among them is Australian output flooding overseas markets. Over the past few years, Australian farmers have been able to build up their flocks and take advantage of favourable conditions. Sheep numbers across the Tasman are at the highest they've been since 2007.

The shipping crisis in the Red Sea isn't helping either. Add to that rising inflation on farm.

Acland points out that on farm inflation was 16.3% last year and 10% the year before that.

She says there are some green shoots emerging, like rising export volumes to the lucrative UK market, but the effects are yet to flow on to farmers.

The new coalition Government has promised to dismantle legislation that impacts the agriculture sector, including legislation around the contentious emissions targets and pricing.

Acland says they have been in regular contact with the new Government.

In December, representatives from B+LNZ, DairyNZ and Federated Farmers met with Agriculture Minister Todd McClay.

Acland says the three farmer organisations are working together to present pastoral sector issues together to the Government and discuss how to solve them.

"We're stronger working together; we don't want to be fighting each other in the Environment Court.

"There always will be tension but nobody wins by fighting among ourselves."

Acland says she doesn't agree with emissions pricing but accepts that a pathway must be foun to manage emissions coming from agriculture.

"We need a pathway that balances the need for some emissions reduction, with the need for a productive and profitable agricultural sector."

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