Coming down south like heading into a different land

I am fortunate enough to be in Southland for two days and can't help being fascinated by the woolly little furry white animals I see on the roadsides looking nourished, healthy and anything but under threat.
Sheep were part of my upbringing but living in Canterbury and growing crops and being surrounded by dairy farmers makes you forget about that Southern part of your life but it was reassuring to see the quality and quantity of stock coming down yesterday.
A friend asked me last night if I thought that sheep would ever return to some of these dairy farms in the province and honestly I think this is an improbability.
However, on many South Otago farms there lies a history that may prove otherwise. Dairying and sheep farming have always been cyclical in the area with many farms still housing derelict milk factories to prove that.
So never say never. It has been dairying land before and it has been sheep farming land before. Undoubtedly though moving back to the strong sheep farming history would be highly unlikely when you take into account the on farm investment on dairy farms these days and the high capital costs.
But if sheep farming does become a marginal commodity it could lead to an increase in demand particularly if wool was to come in fashion again. One can only wonder at those heyday years of the 50s my father in law talks about when the wool cheque more than balanced the books.
In any case it was somehow reassuring to see that not all sheep farmers are bowing out. It just wouldn't seem right if we didn't have that scenery anymore.

Are lamb prices going to hold?

Okay, I have a vested interest in this. Today we have almost secured 1000 Southland lambs to finish and it looks likely that we will have to pay $85 to $90 per lamb.

We have been advised that this price is not likely to drop, and that even if a short sharp cold period puts paid to growing conditions down South, there are just not the lambs in the market, so we consider ourselves lucky if indeed we do manage to secure them, despite the horrendous overdraft it will likely cause!

Alas there are plenty of grass paddocks in Canterbury - a surplus of the recent wet spell that has carved havoc through the harvest season, so competition is hot.

Alliance have advised that they expect we will get over $6 a kilogram in August for them - with some predicting, all going well, that this could hit $6.50.

So while $120 to $135 a lamb seems a good profit, there is a lot riding on the overseas markets in the next couple of months for many of us as these lambs are not on contract - as such.

And for those farmers not able to get lambs and with plenty of grazing available there is not much to be had in the dairy market.

The Otago Daily Times reports that dairy farmers down South are holding off signing contracts as the situation becomes clearer. They know that with all the extra grass around they should be able to barter downwards - as will happen in Canterbury.

It's a situation we will keep our eye on with interest.

Let's hope those in the Northern Hemisphere keep eating at home as the recession bites (even Gordon Ramsay has had to close his posh Paris restaurant as punters save their money and cook at home instead of going out), and demanding our lovely lamb for their Sunday, Monday, Tuesday, all days of the week dinner!

The English Connection

The old adage that 'farmers do well under a National led government' has not always been true.

However, this could turnaround in light of the English connection.

Bill English, of course, is of pure Southland farming stock - Dipton in fact, but ironically it's his brother that may well shake the National party up and hold them to their rural values.

Federated Farmers CEO Conor English is a feisty agricultural advocate and is already making a significant impact, not only on the lobby group itself, but on national issues affecting all New Zealanders (Aucklanders).

It was distinctly refreshing to see the man in action recently, stomping his feet about the $1.9 billion 5km motorway proposed for Auckland. Fair go, he said, how about thinking about water storage for the agricultural industry and the jobs that might create. (Okay, so I paraphrase a little).

He certainly got up John Bank's nose (an impressive feat considering the size) and you could hear the whooping through-out the rural hinterland as farmers rejoiced at having someone 'take it to em city-ites once more'.

Farmers have had to endure possibly the worst year of criticism from urban-ites in New Zealand's history. The contempt for agriculture by those ignorant to how the industry operates and what it means for the economy has been palpable and dangerously contagious.

Here then is a way of gaining some ground at what best can be described as a 'difficult economic time'. Creating jobs and furthering agriculture is a win-win situation.

And herein lies the fascinating fight. Bill English happens to be the Infrastructure minister and Conor is the farmer's friend. Will Bill concede this one and finally put water storage high on the Government priority list.

The power each of them holds may yet deliver National as the Government that farmers 'do well' by - and if that is the case, you can thank those English genes.