The Weekly Dairy Report: More signs that a long term focus will be needed to the turnaround to profitability

The North Island has had some useful rains which has helped keep the dry period at bay for a month or two longer, but the South Island eastern areas are still in soil moisture deficit and irrigators face future restrictions.

Under the present low income climate, those that have invested heavily in irrigation only to find they are facing periods of lack of water, puts huge pressure on getting an economic return from this development expense, and many run of river schemes have expanded the amount of stored water carried.

Pasture growth rates are predicted to be variable in the next fortnight with more seedhead activity appearing, and quality will be dependent on previous pasture management and mowing to tidy feed that is past it’s best.

Indications of how mating is progressing is now starting to be evident, and managers will be tracking how their herd is building to the goal of 90% submission rate in three weeks and some are predicting another surge of culling for cows slow to concieve.

Nationally it appears more use is being made of terminal sires for late and poorer producing cows, as many are trying to recover some value out of beef cross bobby calves.

The milk market fell again by over 7% at auction last week and prices are now back to where they were two months ago, and reinforced the belief that there will be no quick turnaround this year.

Dean Foods has also reported doubts on a short term recovery citing persistent global dairy production surpluses especially in Europe, and Fonterra’s CEO has expressed concerns about his company losing Chinese market share from this continental milk.

NZ’s Nuffield scholar has reported on her global study on milk price volatility that there is no simple solution to fix the problem, and the techniques used by NZ farmers are also used by many other global dairy farmers.

Sensibly officials have given Filipino dairy workers caught out under the immigration scam a reprieve, as the management implications of sending big numbers home would have caused serious disruption to the sector.

Further dairy weaner beef sales in the north have returned prices ahead of last year, as buyers decide they are less optimistic about sheeps future and decide to stay with beef.