Rural Wrap

Spring Lamb

Doug Steel -

Amid uncertainty and insecurity of much change in the agriculture sector, primary product prices have been a pillar of strength. Subdued supply in many markets has offered price support as has a lower NZD. And in spite of various risks circulating offshore, demand has remained generally firm and even strengthened in some areas. Prices have been firm across many major export products, but none more so than lamb.

Concern and Caution - August 2019

Doug Steel -

The latest survey of farmer confidence from Federated Farmers does not make pretty reading. To be sure, it is not all doom and gloom but there is no denying a mood of concern and caution among the farming community.

Milk Price Uncertainty - June 2019

Doug Steel -

Current market conditions are milk price supportive. We caution against necessarily extrapolating such conditions over the entire season ahead. Global milk supply is currently muted offering support to prices but we are guarded regards demand over the coming year given current trade-tension-induced uncertainty. Our milk price forecast for the 2019/20 season remains at $6.70, but we look at some alternative scenarios given the current uncertainty.

Mixed Signals - April 2019

Doug Steel -

Primary product prices are buoyant and interest rates are low, yet rural property transactions are generally subdued. Rising costs and elevated uncertainty appear to be among the many factors at play. Meanwhile, some other indicators of on-farm investment are strong.

Food Prices In An Uncertain World - January 2019

Doug Steel -

World economic growth is slowing with concerns that it might turn into a slump. This raises downside risks to NZ’s primary product prices. We expect further deceleration in the world economy, but not a deep downturn. Uncertainty indicators are very high. Oil prices are lower; so too equity markets. But food prices have fared better. If the world economy can hold together well enough, NZ’s product prices are expected to be flat to up this year on average aided by pockets of supply side tightness.