Agsafe Weekly Rural Report

Finance: The NZ dollar was slightly easier over the week which is good for the exporters but difficult for the importers and travellers especially when oil prices are high. Brent Crude has is fluctuation around $100 to $125/barrel & is currently $109.24.

Wool: The wool prices are firming. There is some optimism in the coarse wool market.

Beef, Sheep & Venison schedules: The meat schedules are steady. There is good grass cover across most of the country. The recent rain was needed allowing the flexibility to continue to finish the stock on the farms.

Dairy Prices. Dairy prices internationally are firm as demand for protein continues to strengthen. The dairy farmers remain optimistic that they will get +$10/kg for the 2025/26 season & are hopeful of a strong opening payout for next season.

The autumn fertiliser should be arranged and with increasing prices soil testing in sectors of the farm can save money. You can even take samples separating the back & the front of the paddocks. The cost of soil testing will pay for itself in fertiliser savings. It is important to get professional advice. The fertiliser reps are supported by professional science trained personnel.

Jim’s Weekly Rant:

My rant of the 21st March touched on the effect the Iranian War will have on fertiliser costs and supply. The cost of basic foods will increase over the next 12-months as shortages become common and the cost of production increases, the increases will be well beyond what we have experienced to date!!. Even the basics of milk and bread will not escape the increases. The Fertilizer Institute has independently estimated that exporters exposed directly or indirectly to the conflict in the Middle East account for nearly 49 percent of global urea exports, nearly 30 percent of global ammonia exports, and nearly half of global sulfur trade needed to make Super Phosphate. The Straits of Hormuz are just an energy chokepoint, but one of the most concentrated nutrient chokepoints in the global food system. The USA is only +/-60% self-sufficient in Urea and they are entering the time when the spring crops are being sown. Australia is supposed to be planting its winter wheat now and it imports its Urea just as we do. NZ relies on the Australian wheat for baking and some grains for stock foods. A shortage of wheat will be a shortage of bread and all baking products and an increase in cost. The current reports from Australia are recording an increase in the planting of nitrogen fixing crops such as lupins, peas, lentils, lucerne, peanuts and even clover in areas where wheat and barley were normally grown the lesser area in wheat and the lack of fertiliser will push the prices up when harvested. The current price of Urea in NZ is $1,075/tonne (Balance 26/3/2026) while at the same time the cost of Urea is being quoted in Australia at +$A1,500/tonne. We should expect the price in NZ to increase when we move to the spring planting season or even need Urea to grow our winter grasses. Sulphur is 11% of Super Phosphate and it will also be in short supply, but while the phosphate portion may be secure there will be a significant increase in the cost of most fertilizers that include Sulphur, and most do. We need to look at what a shortage of Urea might have on the Maize crops planted in October/November 2026 providing feed for the 2027/28 season – lower yields will lead to a reduction in milk production and that will follow reduced milk production from the Northern Hemisphere countries that are currently planting their spring crops to feed livestock over the winter of 2026 and into their 2027/28 season. The shortage now will have effects for the next 2 production seasons. Will a shortage of food reduce the production and will the lesser production then command higher prices to compensate the drop in production? The circular argument of supply verses costs of production and sustainable product prices will go on for ever and only time will answer it. My comments here are to encourage you all to think about the effect a lack of Urea and Sulphur might have on our economy and on our ability to earn over the next 2-season whether it is crop and grain production, milk, meat or fibre. It is also a call to encourage you all to think again about the dumbest of political policies – NET ZERO and encourage the government to look at again making our country self-sustainable in energy and fertilizers. The Urea plant was closed by Jacinda and her henchmen (ladies), companies have been blocked from mining the phosphate reserves on the Chatham Rise and we know there is plenty of oil around and on NZ. And added to the pain of lesser crop yields and animal performance the cost of diesel has increased exponentially right on our harvest time. Planting crops, harvesting crops and transporting livestock all have to be paid for and that also adds to the cost of production and if yields are reduced that will compound the increases in costs. The immediate future looks bleak for the country especially the wage and salary earners and the politicians who will be blamed for the increasing food costs!!!