‘Groggy’ sheep farmers’ economic hangover

The upcoming season looks particularly challenging for sheep farmers, according to Tapawera sheep farmer and meat and wool chair for Nelson Federated Farmers, Kerry Irvine.

Despite a modest improvement in global red meat demand, farm profitability, particularly sheep farming, is set to decline further according to both Beef and Lamb New Zealand’s latest forecast and local farmers.

“Low demand from China’s market is expected to maintain low sheep meat prices,” Kerry explains.

“It’s tough times, recovering from the drought, high input costs and low returns. With a struggling market and no forecast of improvement, this season is going to be a real challenge for many.

“Sheep farmers are going to be weighing it all up and thinking about if they can keep sheep farming or not. What we need is increased lamb prices and decreased costs of things like interest rates, fertiliser, fuel, and animal health, all the general day-to-day expenses that have gone up so much.”

However, increased lamb prices or decreased costs are sadly not anticipated.

While the outlook is challenging, Kerry says communication with accountants, bank managers, farm advisers, and local Rural Support Trusts, is key to getting through.

“It’s a bit like a hangover,” Kerry says.

“We’ve been struggling for years, and we are all groggy, recovery will take time, and the wheels will get rolling again. It’s just going to take time.”