It's The Margins That Matter
OPINION: It appears to be difficult for people who haven’t tried to run a business to understand the difference between assets and cash.
But he says farmers now need a warm and settled late summer and autumn or they could pay the price in winter feed shortages.
Stockman is responsible for the area south of the Waitaki, which he said produces 23 or 24% of the entire country's milk production.
He said every region of the South Island has had its challenges, including cool temperatures, high rainfall, the windstorm of October and, more recently, hail damage to crops in Canterbury.
However, overall milk production has remained very strong compared to last year - albeit coming off a lower than normal base last season.
He said that the South Island generally was about 3% of last year.
"I know that Southland probably was running, pre-Christmas, double digits - so potentially 10 percent up. But we had a terrible spring in the previous year so production was well down then."
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Stockman said maintaining production has depended on maintaining feed, and high milk prices will have supported higher percentages of feed being imported onto milking platforms.
But recent hail damage to crops in Canterbury could have a two-fold impact on dairying. Not only will it push up the price of feed grains going forward, but the hail will also have damaged the likes of fodder beet and kale on dairy wintering blocks.
"There's been probably a double whammy, in that potentially we might be looking at less access to feed for the wintering and for the following season."
A weak autumn followed by a harsh winter would make the following spring incredibly challenging.
"What we need is some good weather. We need consistent good sunshine to push that grass along. Good rainfall, good sunshine hours, we can grow more grass, which is more cost effective than continually having to buy in more feed."
If farms don't have grass it could mean drying off early, and going into winter with wet soils would also be problematic from an animal health point of view.
Good Recovery After Windstorm
What set the season off to a poor start for many South Island dairy farmers was the massive windstorm of late October.
For Southland, the major damage on dairy farms was to structures such as wintering barns and covered pads, as well as widespread trees downed power lines.
However, DairyNZ lower South Island regional Jared Stockman believes the province had recovered very well.
For North Canterbury, the big problem was toppled irrigators particularly around Culverden, which meant a loss of irrigation and lessened grass growth.
Stockman said a lot of farmers would have made good decisions to manage the deficit by culling some stock or deciding early which paddocks to use for wintering.
They were probably tracking forwards a really good season prior to the storm and it put them "in a challenging place", he said.
"There'll be some that have recovered pretty well but I think that their peak milk was probably significantly affected."
Waterforce Christchurch manager Paul Fairbrother told Dairy News that most of the damaged irrigators in the district were repaired before Christmas and there were just "a few bits and pieces" still to do.
"We're pretty much back to where we were."
Stockman said dairy farmers put these things behind themselves pretty quickly.
"In summary the South Island has had a reasonable season, which is fantastic given all the challenges that they have overcome over the last six months. We are cautiously optimistic for the balance of the season."
