Agsafe Weekly Rural Report

Finance:. NZ dollar dropped when the OCR was kept at 2.75 base points. We have one of the lowest Reserve bank rates in the
OECD making our currency unattractive to invest in!! The Brent Crude moved up over the week & is currently at $117.77/barrel.
Wool:  There was no wool sale this last week and prices remain unchanged.
Beef, Sheep & Venison schedules: The meat schedules remain steady to slightly firmer across all categories as the spring growth
kicks in. The international demand for red meat is very strong. .
Dairy Prices WMP & SMP prices are continuing to rise in the Pulse Auction while butter & AMF are easing. It is expected that the
g/DT next week be steady. There are expectations that Fonterra will announce a $10 FGMP before Christmas..
Don’t leave your voting until the last day as something will always go wrong – known as Murphy’s Law!! There are plenty
of polling booths open and waiting for customers. Voting day will be the ultimate in showing the Poll’sters that the public
knew what they were doing. We cannot afford to let the country go back to the left.
Quote: “We don’t have inflation because the people are living too well. We have inflation because the government is
living too well” - Ronald Reagan

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!!
Jims Rant,
The Reserve Bank this week maintained the Overnight Cash Rate (OCR) at 2.75% being one of the lowest in the OECD
countries. The Australian OCR is 4.6%. The low rate makes our currency unattractive to invest in, thus pushing the
exchange rate, particularly against the Australians down. The NZ dollar was at 81.22 c against the Australian dollar last
Friday and was at 79.71 cents on Thursday but lifted slightly on Friday. This is a massive drop. The NZ dollar has also
fallen against the US dollar dropping from 56.98 cents to 56.24 cents. The effect of these drops will be inflationary and
have long-term effects on the economy. The drop against the Australian dollar since November 2023 is 14% and most of us
can remember when the NZ and Australian dollars were on a par. See the movements below.
2025 2024 2023
US dollar 57.3 cents 59.8 cents 58.9 cents
Australian dollar 87.5 cents 90.8 cents 92.7 cents
Take some time to think of other countries that have seen their currencies fall dramatically against the currencies of their
major trading partners – Venezuela is a great example where socialism wrecked a country and we could be next!!. The
Reserve Bank Governor has correctly reported that most of the NZ inflation is caused by external influences being the price
of oil and energy, just think how good it would be if we had our own oil and gas!!. The low dollar gives our primary
producers a false sense of security as prices in NZ dollar terms become exaggerated inflating the price of milk and meat
exports while on the other hand increasing the cost of imported plant and machinery. I am concerned that farmers might
get used to the weak dollar and spend accordingly. A readjustment back to the high 90 cent’s level against the Australian
dollar and the low 60 cents against the US dollar will first be reflected in the product prices before the imported items ease
and we need to be prepared for a change. There will be no real adjustment until the NZ OCR equals the Australian OCR
making our currency equally as attractive as the Australian dollar in the international money markets. As I said a few
months ago, I look forward to the day when our Currency is back on par with the US dollar and about $1.20 against the
Australian dollar and we are receiving $10/kg milksolids and $10/kg for our lamb and beef carcasses.
A comment on the fuel prices: The fuel prices are a hot topic at the moment and we should all be lobbying the government
to dump the NetZero. Our fuel prices are made up as follows:
Excise Taxes $0.70024 / Litre Not charged on diesel - PAY RUC’s
ACC $0.06000 / Litre
Monitoring Levies $0.00570 / Litre
Local Authority charges $0.00660 / Litre
ETS +/- $0.15000 to $0.20000 / Litre (Emissions Trading Scheme)
GST 15% currently +/- $0.45000 / Litre
Total Taxes $1.96250/ Litre
Fuel companies & Retailers $1.58750 / litre
Cost/ litre $3.55000/ Litre