Pressure put on New Zealand's sheep, beef sector

by Bryan Salvage
Share This:

WELLINGTON, NEW ZEALAND — In-farm inflation for New Zealand’s sheep and beef sector was 7.6% for the year up to March 2009, according to Meat & Wool New Zealand’s Economic Service. This is the second-largest increase since 1986-87, said Rob Davison, economic service executive director.

Excluding interest, which decreased in price, the underlying rate of on-farm inflation was 10.7%, the highest since 1985-86. Fertilizer, shearing expenses and repairs and maintenance experienced the biggest price increases.

"The good news is fertilizer prices have decreased 11% since March," Mr. Davison said. "The price for a tonne of superphosphate has decreased 8.6% since March and DAP fertilizer has decreased 18.5%."

Prices paid for repairs and maintenance increased by 8.9%, closely followed by an 8.7% increase for insurance and an 8.3% increase for rent.

The cost of both fuel and interest on farm debt decreased in the year to March 2009, after showing increases last year. "Fuel prices decreased 14.2%, predominantly because of the fall in global oil prices," Mr. Davison said. "The price of interest on farm debt decreased 6.7%, reflecting overall lower interest rates indicated by the Reserve Bank official cash rate falling from 8.25% to 3.00% in the year to March 2009."

Local government rates and charges increased by 33.8% in the last five years, an average per-year rate of increase of 6.8%. However, rates increased 5.6% in the year to March 2009, which is the lowest rate of increase since 2004-05.

Comment on this Article
We welcome your thoughtful comments. Please comply with our Community rules.



The views expressed in the comments section of Meat and Poultry News do not reflect those of Meat and Poultry News or its parent company, Sosland Publishing Co., Kansas City, Mo. Concern regarding a specific comment may be registered with the Editor by clicking the Report Abuse link.