5 Concern over Aus trade talks Vol 19 No 17, May 3, 2021
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Positive outlook for dairy Gerald Piddock
T
gerald.piddock@globalhq.co.nz
HE dairy farming sector has plenty to be positive about despite the potential fiscal and economic headwinds coming its way, economist Cameron Bagrie says. Speaking at the DairyNZ Farmers Forum in Hamilton, he says the economy’s reliance on the farming sector was one of the blunt lessons that emerged from last year. “Thank God New Zealand is one big farm and we can’t lose track of that. NZ needed the farming sector to be the backbone of the NZ economy, as covid gave us some pretty tough challenging times,” Bagrie said. It will remain a big part of NZ’s economic future in a rapidly changing world. He hoped that sentiment coming out of that sector was taking a more positive outlook over the next few decades. The sector had reduced its debt to around $38 billion after being labelled vulnerable in the Reserve Bank’s (RBNZ) financial stability report over the past few years due
to the large amount of interestonly loans being granted. He doubted it will be a focal point in the RBNZ’s next report, due out in the next few weeks. “The dairy sector is one of the few sectors across NZ that I am seeing less points of vulnerability because your balance sheet weaknesses have been addressed,” he said.
NZ needed the farming sector to be the backbone of the NZ economy, as covid gave us some pretty tough challenging times. Cameron Bagrie Economist
But there are still a small amount of non-performing dairy loans at around 3%, which was an indication that these people had embraced business models that did not work. There was also another 8% of loans described as “potentially stressed”.
CREW: Driving the tractor from Invercargill to Christchurch and back are, from left, Bob Anderson, Colin Hitchcock, Graeme Anderson, Keith Watkinson, Win Saxton, Tom Parkes, Fraser Pearce and Owen Anderson.
563km tractor trek for charity Neal Wallace neal.wallace@globalhq.co.nz EIGHT vintage machinery enthusiasts departed Invercargill on Sunday, driving a 38-year-old tractor to Christchurch and back in the name of charity. The members of the Thornbury Vintage Tractor
Another positive was that China was one of the few countries around the globe where its GDP was back up around pre-covid levels. “My personal view is that you’re going to see milk powder come back from $4000/tonne back to around $3500,” he said. He says covid had caused huge supply chain issues around imports and if it continued,
and Implement Club near Invercargill are driving the bright yellow Massey Ferguson 20D for 563km to raise money for the Southland Charity Hospital being built in Invercargill. Club member Fraser Pearce says the tractor will be driven almost continuously during the 48-hour trek, during which
importers might look to local suppliers instead. “If NZ is starting to have that conversation around stuff that we bring in, you can bet your bottom dollar other countries will be having those conversations around the stuff that they bring in,” he said. This could see an acceleration in investment around technologydriven food.
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they will drive at 30km/h to the Canterbury Charity Hospital before returning to Invercargill. The Southland Charity Hospital was the idea of Southland farmer and cancer victim Blair Vining as a way to address inequitable access to health services, especially for rural areas.
The good news was that population growth meant continued demand for naturally produced food. NZ’s ‘she’ll be right’ attitude towards covid disruption had to change and businesses and central and local government needed to learn to take risks in this new environment.
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