Agsafe Rural Report: Finance

Finance:  The NZ dollar was steady against the US dollar and other major trading currencies over the week.   Brent crude is up to $US79.75/barrel but fuel prices remain high.

Wool:  A recent reports has again suggested that the prices might improve when they move back to wool carpets!!     

Beef, Sheep & Venison schedules: All meat schedules are steady with only minor intercompany changes for the coming week   

Dairy Prices:  Dairy prices are weaker.  Some banks are continuing to lower their forecasts for the current season with the ANZ now at $8.25 and Westpac down to $8.60.  There are reports from accountancy firms that up to 80% of all dairy farms will be trading at a loss this season.  The loss is due to the 16% increase in farm costs and the massive leap in interest rates over the last 6-months.  It is dire situation going into a recession when the agricultural sector at large has been propping up the business community.

The minimum wage goes up on 1 April to $22.70/hour and increase of $1.50/hour.  Most farmers are paying over the minimum, but we know it leads into other employees wanting an increase to maintain parity.  Most businesses cannot afford the increase and we all know it will be inflationary.  Pensioners and beneficiaries also get an increase!!!