Get Real - Arable Industry Reality Check
GET REAL - ARABLE INDUSTRY REALITY CHECK
"Ask any arable
farmer about the boom down on the farm, and he will tell
you
to 'get real', according to Neil Barton, Chair of
Federated Farmers Grains
Council. "Arable farmers have
not shared in the recent lift in income
attributed to
pastoral farmers."
Much of the media comment reflects the
good growing season for pastoral
farmers.
"For arable
farmers, the boom simply has not happened. Arable returns
have
not increased, and grains farmers have had another
tough harvest. Prices
remain low, and costs are
increasing due to the weak New Zealand dollar."
"The
negative effect of these problems on farm returns was
compounded by
unfavorable weather during harvesting. Any
comments about a better year has
been related to better
cereal yields following the two previous dry years,"
said
Mr Barton.
"Loose talk of increased farm profitability
must not lead to any expectation
of cost increases.
Arable farmers are not in any position to
absorb
increased costs."
The prospects for the 2000
harvest do not look any better. Contracts for
milling
wheat so far have offered only minor increments. Feed wheat
and
barley contracts are offering similar prices to last
year. Herbage seed
contracts have reduced in volume and
price.
"Our concern is that the weak New Zealand dollar
has already increased the
costs of production."
"More
cost increases are yet to come. Fuel prices, one of the
largest costs
for arable farmers, have risen another
three cents over the last week," he
noted.
"Real farm
profits have been trending downwards over the last three
decades.
Although last year's farm returns were higher,
the returns are still only
54% of the average farm profit
in the 1970's when measured in real terms."
ENDS
For
further information: Neil Barton 021-441-125
Kevin
Geddes 03-307-8148
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