Hard year looms for dairy farmers
Some dairy farmers cannot afford to pay staff during low payouts and a few of them were leaving dairy farming, says Dairynz regional manager James Muwunganirwa. He said most farmers, after two years in the red, and another season of low payouts looming, were looking at ways to cut farm costs.
Muwunganirwa said some farm owners had gone back into the milking shed to ‘‘get their hands dirty again’’ because there was no spare money.
‘‘Some owner operators are back milking again, because a few farms can’t afford staff,’’ said Muwunganirwa at a ‘Tactics For Tough Times’ field day by Dairynz looking at the new season. ‘‘And some farms were keeping their labour intact, otherwise they would have to make unsustainable cuts and that would compromise their productivity.’’
But he said while most farmers were keeping staff, some could not afford to keep them on.
‘‘Some businesses are struggling and they have to let one or two staff go.’’
Muwunganirwa said debt was another concern.
‘‘It is on a case-by-case basis, but just looking at the lower North Island, debt levels were about a third. About $1.60 per kilgram of milk solids in terms of interest.’’
Some farms have no debt, most have some, and a few carry a lot of debt.
‘‘While that debt doesn’t seem a concern, people have had to borrow to fund working capital. That could push debt levels higher.’’
On the animal front, Muwunganirwa said most cows were looking good, and farmers were setting up for calving.
But it had been raining in the past few weeks, and there was a lot of mud around, he said.
‘‘So the challenges are around making sure there is no pasture damage.’’
He said there was a lot of concern over the disease facial eczema.
‘‘If you go a few weeks back, there were high spore counts in many areas and a few clinical cases. But the biggest concern now is calving, when the pressure goes on.’’
He said the worry was that some cows would go down at calving and not get back up because of sub-clinical (no outward symptoms, but the liver is damaged) eczema.
Muwunganirwa said dairy farmers were not buying in extra feed, but growing their own to save money.
‘‘We’ve seen a turn-around. People are going towards being more self contained – they are growing their own fodder beet, chicory and maize on-farm. That’s an effect of the milk price being so low..’’
About 45 people attended the field day at Robert Ervine and Colleen Sheldon’s farm near Rangiotu.
Ervine said the cows were in good condition and pasture was looking good, after great autumn growth.
March rain allowed most farmers to grow pasture ready for spring calving.
Many farmers started calving dairy cows from the middle or at the end of next month.
Ervine said the farm was looking good and there had not been a flood.
‘‘This time last year we were sending cows out with snorkels and 95 per cent of the farm was under water. So this year it is a big difference. We are at pasture levels we calve on. So that is good.’’
He said their cows were being fed completely on pasture.
‘‘Calving for us is a month away. And the cows are dry. So we’re taking it easy. But there are some early mornings, if it is raining, we want no mud, so the cows are shifted.’’
Ervine said a new staff member had just started and was being inducted on to the farm.
‘‘He is keen as mustard, so we are looking forward to the season.’’