Agsafe Weekly Rural Report

Finance: The NZ exchange rates were steady over the week. The Reserve Bank lowered the OCR by 25 points as expected. Brent Crude is $61.18/barrel but ranging between $60 & $65/barrel. The 20% 1st year depreciation has had a positive effect on businesses.
Wool: Wool prices are steady but at a low unsustainable level. With low oil prices synthetics will again get a jump on wool!!
Beef, Sheep & Venison schedules: Meat schedules are mostly up for the coming week. The strong interest in beef is pushing feeder calf prices up in anticipation of even higher prices.
Dairy Prices. Fonterra announced its opening shot for the 2025/26 season with a range of $8 to $11/kg ms. They have a $7.50 interim payment form 1st June & have now offered some retro-payments in June to Sept 25 – this was desperately needed.

The Plan Change 1 (WRC PC1) decision has been released at the same time the government has announced major changes to the RMA. It will take a week or two to get our heads around it all and be able to comment on the effect of both documents. They will have implications for all farmers, and we need to understand the implications & the practical implementation.

You can hear us live on the radio on Monday morning at 7.35 am with Brian Kelly on Country Sport Breakfast – Radio NZ Gold AM. 792 AM in the Waikato & 1332 AM in Auckland.

Jim’s Weekly Rant:

I attended the DairyNZ Farmers Forum on Tuesday. The attendees were a mix of a few farmers and DairyNZ staff and others from the supporting industries. I learnt that we should look at the term AI as meaning Amplified Intelligence and not Artificial Intelligence. The uninspiring presenter of the session on the future I am sure is a disciple of the World Economic Forum and the Green agenda while some reality was then presented by Vangelis Vitalis who is the deputy secretary for the Ministry of Foreign Affairs and a trade negotiator. Vangelis reminded us that 1 in 3 NZ employees rely on export trade for their employment and that dairy products suffer from the highest levels of tariffs worldwide. The average international agricultural tariff is 20% while the average dairy tariff is 47% and if the EU dropped 50% of its cheese tariffs the world cheese price would lift by 8%. We were reminded that tariffs don’t just come as across boarder charges but are also found in the form of internal subsidies and demands for compliance with environmental and biosecurity demands and our signatory to the Paris Accord is used against us. The environmental demands are mostly attached to the requirements of the Paris Accord, even if the particular importing country only pays “lip-service” to the climate nonsense they still use it as a bargaining tool! One positive effect of a tariff is that it can create problems for protected economies leading to the collapse of the protection. To rid the world of the Climate nonsense and the Paris Accord I believe would benefit NZ and international trade because it is one less area that trade blocks can be created. Cameron Bagrie is always good value and he saw the world changing from an economic model to Geo-political model, and it hasn’t just started with President Trump, but Trump has pushed it to a new level. He likened the current situation to being the worlds biggest game of poker with Trump not being a good poker player, Putin having a very weak hand and Xi Ping (China) being able to just sit and wait for the other players to implode! The global model is experiencing tectonic shifts with popular politics driving the extremes to either the left or the right with the middle economic ground being left behind. Some other interesting statistics and facts are that China controls control 90% of the worlds rare-earths, that China is responsible for 30% of the worlds manufacturing and is part of the very powerful BRIC’s groups of countries that include Brazil, Russia, India, China, South Africa, Saudi Arabia, Egypt, United Arab Emirates, Ethiopia, Indonesia, and Iran. Cameron say’s NZ has a lazy economic model and our productivity is poor with only 2% productivity growth in agriculture in NZ and only 0.3% across the whole economy. Bruce Thorrold and Mark Storey both support the low productivity in the NZ economy and the lack of productive growth. But what will drive our economy and increase our economic growth over the next decade? If it is agriculture we will need to grow more grass, harvest more grass, create new uses for our commodities including meat, milk and wool (fibre). We will need a workforce that will want to work 5 or 6 days a week and who will be innovative while at the same time being excited about being part of a vibrant cohesive country. I have some hope that a new level of enthusiasm for our country can evolve and we all work to make NZ great again because it can be!!.

Get yourself a copy of a great book - “Green Murder – a life sentence of net zero with no parole”. Author - Dr Ian Plimer and perhaps the best known Australian geologist.
Dr Ian Plimer has recently published a series of Three easy to read books for ankle-biters, teenagers and adults.

Contact AgSafe NZ Ltd - Phone 027-2872886. We can prepare your Work Safe manual and hazard management plan at a very competitive price. We can arrange drug tests and farm maps for your property.