07 Jul Farmers might not get much through the Budget but leads searching for g d in export markets
The farming sector may well not get the recognition it deserves in this year’s budget, nor much assistance along the road to reducing methane emissions — but at the least farmers can take satisfaction (as brand New Zealand emerges in to the post-Covid period) that comes back for the sector’s output have already been strong. The prospects are that high costs for many services and products are suffered next period.
The newest Global Dairy Trade auction this week saw prices easing slightly—but for the merchandise that bears the influence that is greatest on Fonterra’s farmgate milk price, whole milk powder, it is still 54% higher than at this time in the previous period.
Analysts are confident it'll stay around that degree season that is next.
One other encouraging indication for main producers is the fact that rates within the meat sector are buoyant. This Westpac lifted its farmgate lamb forecast to at least $8/kg, and sees it possibly rising to over $9 week.
Senior agri-economist Nathan Penny said which was perfect for farmers’ wallets.
“As, in particular, Covid vaccines roll away and more people head back again to restaurants… we’re anticipating that to lead lamb prices greater.
“Normally prices are falling at this time of the year, in order that’s sort of pointing to some genuine underlying power in demand.”
Penny thinks strength that is broad NZ’s key export markets should give a b st to all meat sectors. He estimates farmgate beef costs to raise to around $5.50/kg by spring – nevertheless the US dollar could bring that figure back.
Argentine has just slapped a 30-day ban on beef exports. This appears more likely to offer NZ exporters a window into both the usa and markets that are european.
Venison costs, that have slid all year and remain weak, could come back with post Covid-19 demand from key markets, Penny said.