Sharemilkers in for a hard time

Upbeat sharemilker Richard McIntyre acknowledges things are not going to be great this season but ‘‘we’ll get through it’’.

He is a glass-half-full kind of person, always thinking about the positives.

But with Fonterra’s milk payout dropping to $3.85 per kilogram of milksolids for the season, it is going to be tough.

McIntyre and his wife Emma are 50:50 sharemilkers on a farm just south of Foxton. They own the cows, pay for milking shed costs and machinery, as well as labour, and half the feed costs.

Fifty per cent of the payout goes to the landowner. The McIntyres get $1.925 per kg of milksolids. It’s not a lot, and McIntyre says they need to take $98,000 out of the budget this year and $35,000 next year to cope with the lower payout.

‘‘That $133,000 is having a big impact. We’re reviewing everything, and asking is a thing we’re doing because we like it, or does it make money.’’

McIntyre says he took a few days and found a quiet time to enter the new figures in his budget.

‘‘It’s not a disaster but will be a challenge. It’s not a time to panic and put our heads in the sand – but to plan and talk to rural professionals.’’

The McIntyres used to be lowerorder sharemilkers and built up to owning their own herd.

‘‘We’ve worked too hard for this and we’re not going to fold.’’

They’re proud of their achievements and the McIntyres say owning their own herd of 440 cows is a positive.

‘‘I spent years looking after other people’s cows. It’s nice to have your own herd.’’

He says the good thing this season is that cows have calved well and are in good condition.

He intervened in about 5 per cent of calvings, and there were hardly any metabolic problems, such as milk fever, or lack of calcium.

He says every dairy farmer has seen cow prices go down. ‘‘Cows were traded a couple of years ago for $2100 each. Now they have gone to $1500, so there has been a drop in equity.’’

He says it is a struggle for people who paid those high prices.

‘‘The worst thing is some people will have to leave the industry through no fault of their own. They made good investment decisions at the time – not risky or bad decisions.’’

He says banks want to help farmers and no-one has been foreclosed on.

‘‘We need to make it easy for them to fund us. Talk to them early about the budgets. It’s no good going in November when the money runs out and saying you need more. Keep them appraised right the way through.’’

McIntyre says a farmer should talk through the budget with their consultant. DairyNZ has offered one-on-one consultations and it is easier to talk around the kitchen table, say the McIntyres.