Early Bird I Friday May 31st 2024

MP’s grill big banks at primary production select committee, Government’s budget announcement straight forward and without surprises, and Federated Farmers calls for swift changes to Kiwisaver rules for young farmers. Welcome to Proud Country's Early Bird - The top things you need to know that impact rural New Zealand delivered to you by 5am, because who doesn’t need better chat beyond the weather! MP’s grill big banks at primary production select committee Sceptical MPs have questioned big banks about their claims of maintaining good and strong relationships with farmers. The primary production select committee, responding to a call to action from Federated Farmers, is examining the state of rural banking and considering whether to initiate a full inquiry into lending practices affecting farmers. Federated Farmers had previously informed MPs that farmer confidence in banks was declining, with many feeling overcharged for loans and about one-fifth experiencing undue pressure from their banks. When bank representatives faced the committee, their attempts to present themselves as supportive partners to farmers were met with scepticism. MPs expressed concerns about the closure of rural branches, which has left farmers, particularly those with poor internet connectivity, without face-to-face banking access. They also questioned banks on the high costs of farm loans compared to city home loans. National MP Miles Anderson highlighted the significant difference in rates, noting that farm overdraft rates were considerably higher than mortgage rates despite being fully secured Roger Beaumont, chief executive of the Banking Association Te Rangipū Peke, acknowledged the high interest rates and significant outgoings for farmers but insisted that banks still aimed to support their customers through challenging times. National MP Catherine Wedd repeatedly asked bankers about their high profits, referencing Reserve Bank governor Adrian Orr’s comments that New Zealand banks have some of the highest returns in the world. Roger Beaumont offered a vague explanation, pointing to various factors and comparing banks' performance to other companies on the NZX50. This comparison was previously criticised for being misleading given banks' low-risk operations and implicit taxpayer guarantees. Federated Farmers is urging Parliament's Primary Production Select Committee to conduct an independent inquiry into the rural banking sector. Government’s budget announcement straight forward and without surprises Thursday's budget announcement has been described as straightforward and lacking surprises. Federated Farmers president Wayne Langford compared it to the average farmer’s budget, noting that the government also doesn't have much extra cash for non-essential spending. Farmers have been grappling with reduced incomes, rampant inflation, and high compliance costs. Despite these challenges New Zealand’s economic success relies on the productive sectors, including agriculture, which create jobs and generate income.  Langford appreciated the continued funding for essential services such as frontline biosecurity, catchment groups, and cyclone recovery efforts. He also welcomed the government’s ongoing investment in research to help farmers manage their environmental impact. Economic difficulties are becoming more apparent nationwide, a reality that farming families and rural communities have been facing for some time. Wayne Langford says there is a strong connection between the well-being of farmers and the overall New Zealand economy. He called for reducing unnecessary red tape, regulations, and compliance costs that hinder farmers, rather than increasing them. Langford says farmers are not seeking handouts but rather a reduction in the bureaucratic obstacles that impede their work. Moving Day farmers reminded to make it a clean one As Moving Day approaches tomorrow, the dairy farming community is gearing up for a busy time. June 1st marks the official start of winter and the date when approximately 5,000 dairy farming families across the country relocate to new farms to commence new sharemilking contracts. With numerous people, farm equipment, and animals in transit, farmers are being reminded of the importance of robust biosecurity measures to minimise the risk of spreading pest weeds.  Proper machinery hygiene is always essential when moving equipment, unclean machinery can easily spread pests, as a single seed or small fragment of a weed on contaminated equipment can create a new infestation. Additionally, farmers are reminded of the importance of managing livestock effluent responsibly. Given that a cow produces about 52 litres of effluent daily, while a truck tank holds only 200 litres, careful management is required to prevent road spills. Farmers should also inspect all machinery to prevent spreading seeds, roots, or fragments. Thorough cleaning of all parts of machinery, including tires, tracks, undersides, grills, and filters, is essential before moving.  These measures are essential for ensuring that the relocation process runs smoothly and that biosecurity and environmental standards are maintained. Federated Farmers calls for swift changes to Kiwisaver rules for young farmers There are renewed calls for Kiwisaver changes that could allow young farmers to get their foot in the door of farm ownership and should be able to access their KiwiSaver, according to Federated Farmers. Federated Farmers dairy chair Richard McIntyre, believes it is the right time for the Government to change the rules, allowing young farmers to use their KiwiSaver savings to buy their first farm, herd, or flock.  McIntyre says many young farmers have managed to save a decent deposit but are unable to secure the necessary bank support to invest in their first herd or property. Allowing them to use their KiwiSaver funds would significantly help in pulling together a deposit, especially during these tough economic times.  Federated Farmers also advocate for changing the rules so farm staff in service tenancies can use KiwiSaver to purchase a house.  Currently, KiwiSaver can only be used to purchase a house that the saver will live in, which McIntyre argues is unfair. Farm staff, rural teachers, rural police, and military personnel are being denied the same opportunity to get on the property ladder as their urban counterparts because they live remotely and in employer-provided accommodation. Federated Farmers have been calling for a change to KiwiSaver rules to support younger farmers, making it one of their 12 key policy priorities for the incoming Government.  McIntyre says Federated Farmers will be working with politicians over the coming months to work on the policy. Limited spaces available for 2025 graduate programme The Grassroots Dairy Management Graduate Programme is seeking ambitious and motivated trainees to begin their careers in dairy farming, and is currently recruiting its next intake of graduates for the 2025 programme. The programme's aim is to attract university graduates into the dairy industry and match them with reputable farmers for on-farm jobs.  Programme chair Kim Grayling says participants will work full-time while engaging in up to 25 modules and social events from February to November 2025. These modules, led by subject matter experts and a farmer for a practical perspective, cover a range of topics including people management, banking and accountancy skills, animal health, pasture and milk production, and industry fundamentals. With backing from DairyNZ and Rabobank, the voluntary committee of eight farmers has seen programme participants achieve significant success. Many have competed in national events like the Dairy Industry Awards and Young Farmer of the Year competitions, while also advancing in their on-farm roles. For 2025, the programme is offering eight spots to university graduates from any discipline. To apply for the Grassroots Dairy Management Graduate Programme as a graduate or an employer, visit www.dairygrads.co.nz. See omnystudio.com/listener for privacy information.