Early Bird I Thursday June 6th 2024

Government reveals millions in vital funding to go to catchment groups, dairy prices are up at the latest Global Dairy Trade auction, and concern mounts for drought stricken Hurunui 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! Government reveals millions in vital funding to go to catchment groups The Government is committing $36 million to support farmers in improving land management practices, focusing on locally led catchment groups.  Agriculture Minister Todd McClay has announced that $7 million of this funding will be allocated directly to catchment groups across the country. This is in addition to MPI's current investment in 46 catchment-based projects, which support 290 groups and over 9,000 farmers. Significant new funding includes $2 million over four years to catchment groups in Tairawhiti, $980,000 over four years to 13 catchment groups within the Manawatu River Catchment Collective, and $950,000 over four years to the Otuwharekai/Ashburton Lakes Catchment Group in conjunction with the Mid Canterbury Catchment Collective. Rural Communities Minister Mark Patterson says that catchment groups and collectives are essential for revitalising New Zealand's export-driven economy.  Further announcements about the coalition Government's support for the primary sector will be made at the national Fieldays in Waikato next week. Dairy prices are up at the latest Global Dairy Trade auction Global dairy prices have shown a positive trend as the new season begins with the Global Dairy Trade (GDT) price index rising by 1.7% at the first auction of the 2025 dairy season This marks the fifth consecutive auction with increasing prices and follows recent forecast price announcements from major dairy producers. At the latest GDT auction, whole milk powder, which significantly influences Fonterra’s farmgate milk price, increased by 1.7%. Skim milk powder, the second major influencer,  rose by 3%,  Buttermilk powder saw a significant jump of 10.4%, while cheddar increased slightly by just 0.2%.  Other products such as butter and anhydrous milk fat also saw increases, with butter up 1.7% and anhydrous milk fat up 0.9%. Lactose was the only product to decline, dropping 1.9%. ASB economist Chris Tennent-Brown described the prices as robust, while NZX analyst Rosalind Crickett noted the mix of bullish and bearish factors influencing the market.  Despite varied expectations, the auction results aligned with market anticipations, reflecting supply constraints and demand dynamics. Our beef production numbers are down, but export numbers are up Global beef production is expected to contract in the second half of the year, supporting strong cattle pricing in key production regions worldwide, according to a new report by agribusiness banking specialist Rabobank.  In its recently released Global Beef Quarterly Q2 2024, Rabobank forecasts that global beef production for the second quarter will be marginally higher than the same period last year. However, volumes for the third and fourth quarters are expected to fall year-on-year (YOY). New Zealand beef production for the first quarter of 2024 is 3% behind Q1 of 2023, with sufficient pasture availability reducing the need for early cattle dispatch. Cull cows were slow to head off, being 6% behind 2023, and bull beef was also down 9% nationally. However, national steer production was up by 6%.  From January to March 2024, total exports were up by 5% year-on-year, with a 3% increase in total value. In volume terms, shipments to China were down 8%, while exports to other destinations showed an upswing: 14% to the US, 41% to Japan, and 60% to Canada.  The US and Japan also saw an increase in value per unit compared to last year. The AgriHQ North Island bull price has remained steadily around 10% above five-year averages, and farmgate beef prices are expected to remain firm through winter due to very good export demand and value being realised from the US. Concern mounts for drought stricken Hurunui farmers Farmers in Hurunui are grappling with the compounded challenges of drought, poor returns, and high transport costs, leading to severe feed shortages and raising significant animal welfare concerns.  Karl Dean, president of North Canterbury Federated Farmers, says there is low morale among farmers and warned that the situation could deteriorate further. Dean expressed serious concerns about the potential for major animal welfare issues if another adverse event, such as heavy snowfall, were to occur. Many farmers are barely managing their feed levels and could face catastrophic losses under harsher weather conditions. The high cost of bringing in supplementary feed is a major issue, as the expenses often exceed the value of the livestock.  Some older farmers compare the current conditions to those in 1973 and 1992, years that saw significant livestock losses due to heavy snowfalls. Despite receiving only about 40mm of rain this year, the prolonged drought, coupled with low lamb prices, high interest rates, and rising expenses, has severely limited farmers' options.  In normal drought conditions, farmers would typically cull the bottom 10% of their ewes, but current market prices are significantly lower than in previous years. The ongoing challenges are also taking a toll on farmers' mental health. The repetitive nature of daily tasks, combined with a bleak economic outlook, adds to the stress.  Ben Moore, coordinator of Federated Farmers’ Feed Coordination Service, has received numerous calls from North Canterbury farmers in need of feed or grazing. He has also referred some to the Rural Support Trust for additional help and advice.  Moore encourages any farmers in need of feed or grazing, or those who have feed or grazing to offer, to visit fedfarm.org.nz. Strong new season milk price from sustainable dairy processor  Taupō-based low-carbon dairy processor Miraka has announced a strong milk price of $8.42 per kgMS for the 2024/25 season, providing a positive outlook for its dairy farmers after a challenging year. Miraka's suppliers will receive a base price of $8.25 per kgMS. Additionally, farmers can earn an extra premium through Te Ara Miraka, the company's farming excellence programme. This programme recognizes high standards in sustainability, people development, animal welfare, and milk quality, offering up to $0.20 per kgMS as an additional premium. Since its establishment in 2010, Miraka has paid over $21 million in premiums to its farmer suppliers. The company will celebrate its farming and stakeholder community by hosting 300 people at the annual suppliers' dinner in Taupō on June 13. See omnystudio.com/listener for privacy information.