"Everybody’s cost structure is increasing — inflation for us is sitting at 15.8%. That has a massive effect on profitability and choices made on-farm, which inevitably affects retail prices."
The Pomahaka beef and dairy farmer’s family have been in the business since 1929.
"There's current demand for fattening beef and with an early rise in schedule price, [some] processors say they're 80% ahead in the month to date compared to last season.
"The strong demand at calf markets reflects a relatively good summer further south, with spare crop and reasonably priced baleage.
"Lamb prices are coming back from last season ... Processing capacity seems to be an ongoing thing around peak times. It appears the issue is in personnel, not infrastructure ... perhaps still a carry-over of Covid.
"I understand there’s been no turnaround in wool prices ... There’s initiatives to educate on environmental and sustainability benefits of wool but we’re not seeing that appear at the market."
Dairy farming was likely to have a "close year", he said.
"It’s going to be close because of those inflation figures.
"Looking at budgets, we’re thinking ‘what's nice to have and where can we trim’ and the things to go might be those riparian planting initiatives, which are really good long-term but don’t have the necessary financial payback in one to two years.
"We’re hearing some farmers may not be utilising fertiliser this year ... some are able to skip a year depending on existing fertility, but there’s only so far we can push that until levels are depleted ...
"To pull completely out of that style of farming is a big system change that takes further investigation prior to making that decision."
As of May 11, the Otago Regional Council (ORC) had received 250 intensive winter grazing applications and 207 consents had been issued.
Otago was well represented in consent compliance and acknowledged the "consent regime" was forced upon regional councils in response to a minority of farmers whose practice was environmentally damaging, Mr Kane said.
"[ORC] have done a good job of making the documents easy and relatively cheap to obtain.
"What’s hard to say is whether the farmers who have consents have changed any practice to obtain it, or is it purely farmers who were already going about business in a correct and mindful way who’ve obtained it?
"Have we actually fixed any problems here?
"I’m aware of publicity blaming regulation for [contributing to the] cost of living crisis [but] poultry and egg production is the only one you could honestly say regulation has a direct impact on production costs."
Unintended consequences of carbon farming were starting to show; Federated Farmers were receiving calls about an explosion in numbers of wild pigs coming from plantations on to farmland, he said.
- Nick Brook
