Free workshops to bolster farmer financial skills
Free workshops are being offered around the country to help farmers take more ownership of their farm business finances.
There have been some encouraging signs for dairy farmers recently, says Rabobank national manager for food and agribusiness banking, Hamish Midgley.
Midgley says while the dairy industry is sitting on debt to the tune of about $41 billion, there have been some recent encouraging signs in the last few months.
There are signs that debt levels have started to drop because of the higher pay-out. But at the same time he acknowledges that some farmers are still heavily indebted. He says if land prices continue to fall and debt isn’t paid off some people will be facing testing times.
“At Rabobank our policy is to lend up to about 60% of all assets. There will be a few cases where we would lend above that if there were strong mitigating factors and there is quite a buffer in there. But obviously if land prices retract and that debt isn’t repaid then something that is lent at 60% can become 70% or above depending on the movement in land prices,” he says.
Midgley says so long as there is not a lot of volatility in the market and the pay-out remains high then it’s possible that people will re-enter the dairy industry.
But he cautions that there are a lot of unknowns facing the sector around the impact of the environmental and freshwater reforms.
He says the other issue is the lack of capital due to the new restrictions imposed by the Overseas Investment Office (OIO) on overseas people buying land.
“We are getting a lot of feedback from farmers on environmental and freshwater issues,” he says.
“Our view is that farmers have always been great guardians of the land and I think that by and large they have done a good job. They are working to try and meet the requirements of the legislation, but in some cases the rule changes are going to be very tough for some farmers. We have put a submission in on the fresh water reforms and we will do all we can to support our farmers to meet wherever the legislation ends up as but it is a very big change for most farmers,” he says.
Midgley says while there are signs of improvement in the sector, there is certainly no appetite for any more dairy conversions.
“That has dried up completely,” he says.
Federated Farmers president Wayne Langford is claiming “some real success” on the 12 policy priorities it placed before the Coalition Government.
Federated Farmers is throwing its support behind the Fast-track Approvals Bill introduced by the Coalition Government to enable a fast-track decision-making process for infrastructure and development projects.
The latest report from ANZ isn’t good news for sheep farmers: lamb returns are forecast to remain low.
Divine table grapes that herald the start of a brand-new industry in Hawke’s Bay have been coming off vines in Maraekakaho.
In what appears to be a casualty of the downturn in the agricultural sector, a well-known machinery brand is now in the hands of liquidators and owing creditors $6.6 million.
One of New Zealand’s deepest breeder Jersey herds – known for its enduring connection through cattle with the UK’s longest reigning monarch, Queen Elizabeth II – will host its 75th anniversary celebration sale on-farm on April 22.