Agsafe Weekly Rural Report

Finance: The NZ dollar eased over the week finishing at a new low point. The weakening dollar is symptomatic of the weak NZ economy and while it is good for exporters, the imported goods will cost more!! Brent Crude is steady around below the $US65/barrel.

Wool: The wool prices are firming. There is strong demand from China - Australia & NZ are struggling to meet the demand!!.

Beef, Sheep & Venison schedules: The meat schedules are steady with strong demand for red meat internationally. The strong schedules are pushing domestic meat prices up. Chicken and pork prices are attractive for the home buyers!!

Dairy Prices. As predicted the g/DT fell again, but more than was expected!! The drop of 2.4% is ringing some alarm bells. The major concern is the continuing fall in the WMP which is now at $US3503/tonne. Cheddar dropped 6.6% & butter was down 4.3%. Fluctuations will continue as the main trading is in commodities!!

WorkSafe are undertaking farm inspections focusing on different issues on different farms. Chemical management is one of the important areas they are checking. Another area of concern is finding farm owners requiring Contract Milkers/Sharefarmers to have policies, BUT they don’t cover the landowner. Each level of ownership and operation requires the Health & Safety to be managed.


Need Help. If at any time you just want to talk & need someone to talk to, just call - Male Support Services (Waikato) 0800-677-289, or Rural Support Trust 0800-787-245. Crisis TXT – HELP (4357). A shared problem can be a problem solved!!

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:

It had to come, that is the Labour and the lefties Capital Gains Tax. The rate is to be 28%, but the details on how it will work will not be released until after they are elected to govern, so with any luck we will never know the details. The reality is that the tax proposed is not a Capital Gains tax because to gain capital you have to have an increase over and above inflation. The definition of the word “Gain” is increase or acquire. If a property increases in value in line with all other properties there is no gain, just inflationary growth to maintain the value. To tax inflation is morally wrong. The real problem with the proposed Capital Gains Tax is that there are very few people who are prepared to tell people what Capital Gain is and allow the ignorant politicians on all sides to assume inflation is gaining capital. If you buy a rental home in 2027(proposed start date) for $750,000 and it is considered to be a reasonable market value and you sell that same rental home in 2037 for $1,500,000, and that is still considered to be the reasonable market value, then your asset has maintained its self against the inflationary growth in the market, and while your capital has grown, you have not made any gains over and above inflation. If you sell that same home for $1,750,000 and it is worth $1,500,000 then you have gained some capital to the tune of $250,000. Hipkins plan is to tax you on the total $750,000 and not just on the $250,000 you gained. Some of the other unknowns in the Hipkins plan that must concern everyone are:

What happens to any improvements and renovations? Are they deducted or accounted for as they may have been the catalyst for the asset selling at a value above its normal inflationary growth factor?
If an investment home is owned by a company and the shares in the company are sold, how will that be treated? They have said that shares will not attract the CGC. There are a number of investment groups that hold housing as part of their share portfolio so will they be attacked with the proposed CGT?!!
Once the socialists on the left have their foot-in-the-door with CGT, you can be assured that they will expand the tax base and nothing will be safe.
My question to Chippy are:

Are you taxing inflation or true capital gains?
Can you please provide the public with the details of the tax system so we can all understand what it is about and how it will work.
Do you really believe that the policy you have announced on CGT has any credibility?
And my questions to everyone are:

Do you understand the difference between inflationary growth and capital gain?
Would you support a party that refuses to tell you the details of an insidious tax plan before an election?
Have you looked at the new New York mayoral promises and considered the effect they will have on New York – because it appears that the general public didn’t and just voted along party-lines and in part against the “right” and President Trump.
The new mayor in New York, who is a communist and Muslim, proposed policies with limited detail & the voters still voted him in. I hope our voters are more discerning and demand details well before the elections. If a new tax is propose, the details are very important and the public must be informed.