B+LNZ: Farmers performing well despite external challenges
While the focus of the report, produced by B+LNZ’s Economic Service, is to support forecasts that are critical to the industry, it also provides an insight into the challenges farmers are facing and their sentiment.
The report shows the performance of sheep and beef farmers remains high, but sentiment is low.
B+LNZ’s Chief Economist Andrew Burtt says the number of lambs born is positive considering the challenges faced by farmers throughout the year.
"Despite variable climatic conditions nationwide, sheep farmers have again shown their ability to perform consistently," he says.
"This is a continuation of the improving productivity and performance of sheep and beef farms as farmers operate under demanding conditions including drought for some and a wet spring for others.
"One interesting factor was a reduction in the number of hoggets mated, particularly in the southern South Island, as farmers were constrained by feed conditions and did not want to put at risk the performance of their whole flock both short and long-term."
The number of lambs processed in the 2022-23 season is forecast to decrease 1.6 percent to 17.5 million head, while the average carcase weight may be slightly up on 2021-22.
B+LNZ’s Economic Service estimates the number of lambs tailed in spring 2022 decreased by 2.6 percent, or 588,000 head, on the previous spring to 22 million head.
With a small decline in breeding ewe numbers, down 1.4 percent, 22 million lambs tailed in spring 2022 compares with an average of 23.9 million head over the previous 10 years.
In the survey, farmers reported variable lamb growth rates with a wet, slow start to spring for most of the North Island and feed supply being tight for some farms. Labour shortages for meat processors is an issue for the red meat sector and a concern for farmers as we enter summer.
The survey shows the sector is not yet seeing the impact on stock numbers caused by the significant number of sheep and beef farms sold into forestry, particularly carbon-only farming.
This is because there is a significant lag between farm sales and planting of trees – however reduced stock numbers are expected soon.
"This is a major issue negatively affecting farmers. Information about farmer sentiment was also gathered as part of this survey, and it’s clear that confidence in the future of the sector is very low for some. Farmers are feeling it from all sides at the moment and are rightly concerned about the future," says B+LNZ CEO Sam McIvor.
"Government inaction on issues like carbon farming has been frustrating and the speed, scale, practicality, and disconnectedness of the environmental reforms has been unreasonable and overwhelming for farmers. This is compounded by concerns that commodity prices may fall in the coming year."
The report shows some farmers indicated they were considering exiting the sector as a result of these concerns, which could also impact livestock numbers in the future and have flow-on impacts to employees, businesses, and communities in the regions.
McIvor says B+LNZ is again calling for urgent action by the government on the ETS, which is incentivising this wholesale land use change in carbon farming.
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