Farmers say they aren’t seeing any signs of a milk price recovery.
It’s just fallen for the third consecutive time, down 3.6 percent overnight in the GlobalDairyTrade online auction, and it’s at its lowest level since the end of 2014.
Federated Farmers dairy chairman Andrew Hoggard says the trend makes a lift in this season’s payout less likely.
“We really do need to see some signs of a recovery, and so far we are not seeing them,” he said today.
“The Chinese market is weak, European exports to Russia have been dislocated, dairy regions around the world have enjoyed good weather and the northern hemisphere is awash with cheap feed grain.”
Mr Hoggard says there’s not much the industry can do about those issues.
“Struggling farmers need to talk to their banks and their accountants,” he said. “Especially in the drought areas there is a real need to keep a close eye on how much feed farmers have on hand and how much they will need through to the spring.”
Apart from the economy doing well on the back of Auckland immigrants and Christchurch rebuilding, a soft dairy sector is going to continue to provide challenges for the government as they try to balance the books and bring in that elusive surplus.
Weak dairy also provides the opposition with a convenient stick.