Thursday, November 30, 2017
Mark Rieder
WITH three consecutive drops in the Global Dairy Trade, farmers remain confident Fonterra will honour its promise that the dairy payout will hold at current levels.
Gow Road dairy farmer Greg Malcolm said he had not seen any indicators that would push the price down.
“I’m still cautiously optimistic that the payout is going to stay up. The global dairy trade has come back a bit but of course, the majority of our product is not sold on the global dairy trade,” he said.
“With the new Government has come the benefit of the dollar dropping nearly four cents. That alone is probably going to counteract any negatives from the global dairy trade drop.”
He said with the disappointment over the poor performance at the two previous payouts, farmers were hopeful the price would hold.
“Everyone has been looking forward to a good payout on the back of some poor and marginal ones,” he said.
That confidence was encouraging some farmers to make the most of the potential.
“People are trying to make the most of the payout by keeping production up and even increasing in some situations,” he said.
But there was also the possibility that the increase in production could affect the payout price.
“It all comes down to the bottom line. No point making extra milk if you’re not making more money as a result,” he said.
Mr Malcolm said weather was on farmers’ radars as they prepared for what had been forecast as a dry, hot summer.
“The short-term worry for people in the Bay at the moment is it seems to be getting quite dry. Everyone’s thinking about what the summer is going to throw at us,” he said.
He said farmers would already be preparing for the possibility that this summer would turn out to be especially dry and hot
“Farmers are always planning three months in advance. People would have extra feed for their cows – we’ve planted summer crops. Others will be destocking some of their surplus animals,” he said.