Farm feed costs skyrocket

By Carmen Hall

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Bay of Plenty dairy farmers have had to spend an extra $46 million on feed supplements this year due to the drought. Dairy NZ figures show increased costs of $30,000 to $50,000 per farm from January 2013 to April.

Palm kernel expeller (PKE) imported from Malaysia and Indonesia is also in short supply with most shipments already sold in advance.

Te Puke farmer and Bay of Plenty Federated Farmers dairy senior vice chairman Steve Bailey said the price of brought-in feed supplements had skyrocketed and some opportunists were looking to make a "buck out of it."

"Prices are through the roof but it's a supply and demand scenario," he said.

Mr Bailey said his feeding requirements had trebled from what they were at the same time last year. He had been feeding each animal a third less grass since Christmas.

RD1 communications manager Annie Wright said the high demand for PKE had put significant pressure on supplies and demand for supplementary feed was insatiable.

Contracts for PKE were selling right through until the end of the year with the International Nutritions Ltd June/July offer at $315 per tonne, ex Tauranga, she said.

"The situation has been compounded by tight supplies at origin with crush margins being negative, resulting in less tonnage being available for New Zealand importers. Looking forward things are still tight on the supply side."

Dairy NZ productivity marketing manager Warren Twohey said the increase in supplement use would vary depending on how early the cows were dried-off, the type of farm system used and whether farmers had forward contracts for supplementary feed.

Federated Farmers provincial president John Scrimgeour saif the recent rain was a relief but it would be a long recovery.

Feed was the biggest expense to come out of the drought and farmers were feeding out twice a day.

"A big proportion of that feed has been made by farmers and stored on the farm however there will be a greater reliance on purchased feed to get them through winter as they have used up their own supplies."

Typically many cows were put out to graze but unless the grass grows rapidly over the next couple of weeks that won't be happening as much, he said.

"It's been raining steadily and the ground is soaking it up, which is great, but in the Bay we have porous, pumice soils that have an enormous capacity to suck up water. We have probably had enough to kick start pasture growth and now just need consistent rainfall to get back into a regular cycle."

Some farmers may have to source finance from the bank for feed, he said.

Federated Farmers shipments of rye grass and barley straw from the South Island were still coming into Port Tauranga. Other supplements including maize and grain where available on the marketplace but could cost up to $500 per tonne.

- Bay of Plenty Times

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