DairyNZ: Strong payouts offset high farm costs
The dairy sector is in a relatively stable position, with strong milk price payout forecasts continuing to offset ongoing high farm costs, according to DairyNZ.
He says the wet spring has caused a range of problems which will affect the amount of pasture that can be grown and harvested as silage.
Early-season grass is still growing but because the ground has been so wet the cows have trampled the feed, making utilisation poor.
Most dairy farms north of Cook Strait have been affected by the wet spring, Reid says.
“It also meant that because the ground was so wet, contractors had difficulties getting tractors on. So harvesting silage and sowing crops, especially maize, has been delayed two-four weeks and that will have a carry-on effect into the season with later planting dates and less time for crops to respond – a significant issue at this time.”
Reid says in Northland the ground temperature is about two degrees lower than normal, so grass growth has been slower than normal for the time of year.
Two things might ease pressure on some farms, he says. Some dairy farmers have lowered their stocking rate, reducing feed demand from the levels of one year ago. And there is the prospect of a higher farmgate milk price, now set by Fonterra at $6/kgMS.
“The encouraging thing at this time of year is pasture is growing and every windy day is a day of dry and sun to increase the sugar levels in the grass which has been a big problem.”
The late season in the North Island puts a question-mark over whether farmers will be able to harvest sufficient silage to see them through the year. DairyNZ has noticed more farmers are diligent in accurately measuring their pasture quantities by taking time to do farm walks and paying attention to feed budgets.
Some farmers last season skipped herd tests, but Reid is not aware of it happening this season.
He advises farmers applying nitrogen to take care about quantities. The idea of ‘pasture first’, as promoted by DairyNZ, requires farmers to be more diligent in farm management.
