Record spend predicted
The economic stars have aligned for this year’s Fieldays. Forecast milk payouts and high commodity prices suggest spending could be up 10 per cent on last year’s record figure of $538 million.
Fieldays 2017 recorded peak attendance after some lean years in the dairy sector, and the economic impact was a record, according to Waikato University economics professor Frank Scrimgeour.
‘‘It seems to me with the forecast of the milk price and other agricultural commodities reasonably high, you would expect it would be a very successful event this year. I am expecting another record.’’
The southern hemisphere’s largest agricultural fixture generated $538m in sales last year, including $191m in revenue for the Waikato region.
Scrimgeour said it’s clear most farm businesses’ cash flow is in a steady state. There is freedom and flexibility to spend on good opportunities.
‘‘I think people have been chastened by price shocks in recent years – weather, angst about the government – so they’re not going to be going mad and just throwing money away. But where there is opportunity people will be taking it.’’
He believes 30 per cent of visitors will spend more, but not everyone will be opening their wallets. It will be the mid-tolarge spenders that make the difference.
Fair economic winds such as this don’t come around too often.
Fieldays CEO Peter Nation has been around agriculture his entire life and doesn’t recall many times when beef, dairy, horticulture, and venison markets have been this strong.
‘‘There are some challenges but there are always challenges in the agricultural market. The commodity price at the farm gate is good and when it’s good that allows farmers options.’’
The situation for townies is good, too. Nation points to sales of cars and houses as indicators of general consumer confidence.
‘‘You would have to say the stars are aligned for a very good event and good outcomes for the exhibitors.’’
Fifty years ago 80 exhibitors attracted
10,000 visitors to the inaugural event. This year’s turnout is expected to eclipse last year’s record of 133,588 visitors.
Exhibitors are also lining up to join the
1100 spots booked for 2018.
But one big uncertainty remains: Mycoplasma bovis.
Federated Farmers Waikato president Andrew McGiven said potential regulations and rules associated with the disease is a concern.
‘‘But underlying that I think there is a little bit of optimism, especially around the recent Fonterra forecast of this year and next year’s payout price – $7 for next year.
‘‘I think a lot of dairy will be reasonably happy with that and looking at debt consolidation but maybe repairs or replacement.’’
McGiven said having two or three years of low payouts put a lot of farmers behind, especially around repairs, maintenance and new machinery.
He thinks the prediction of sales being up 10 per cent is likely.