Some Hawke’s Bay sheep and beef farms losing $100 per hectare

Some sheep and beef farms in Hawke's Bay faced a projected loss of just over $100 per hectare for May. Photo / Paul Taylor

Hawke’s Bay’s sheep and beef farmers are facing one of the toughest periods they’ve had in recent memory as tough economic and environmental factors compound.

A significant number of these farms faced a projected loss of just over $100 per hectare for May according to the Ministry for Primary Industries’ May 2024 Hawke’s Bay Farming for Resilience Report.

Sheep and beef farms in Hawke’s Bay are represented by three categories in the MPI analysis, which are distinguished by the size of the farm, annual rainfall, percentage of flat land, crops and feed demand between sheep and cows.

The three models are “Summer Dry Hill”, “Summer Safe Hill” and “Finishing”.

The average Hawke’s Bay sheep and beef farm was predicted to end up with a loss of $23.70 per hectare (/ha) in May.

This average included a projected loss of $102/ha on the Summer Dry Hill farm system model in the report, after deducting other farm expenses, such as interest, rent and drawings (over and above wages and management).

In a letter written for Hawke’s Bay Today, Hastings district councillor and Hawke’s Bay Rural Advisory Group chairman Marcus Buddo called for financial support from local and central government for sheep and beef farmers.

He said he knew a couple in Hawke’s Bay running a summer dry hill farm who faced more than $400,000 in costs to reinstate their property after Cyclone Gabrielle. At the same time, he said lamb prices had dropped up to 50 per cent from the year before from $100-$120 to $60-$70 per head.

Kevin Mitchell, Hawke's Bay Rural Support Trust trustee, said farmers should not be afraid to reach out to their fellow farmers for advice during these tough times. Photo / Warren Buckland

Kevin Mitchell, a trustee of the Hawke’s Bay Rural Support Trust, said cost pressures from high inflation, pressure on lamb and cattle weight gain from a dry autumn, ongoing expenses from Cyclone Gabrielle and low prices for lamb all contributed to the current income situation.

“The majority of guys had good lambings back in the spring so they would have had more lambs on, but that means you need more feed to fatten them so it is a bit of a vicious circle. If you have got a record lamb crop, for instance, you really need good feed levels to maximise that otherwise you are forced onto the store market which a lot of guys were,” Mitchell said.

“We are very much a price taker here in New Zealand for our exports, which hurts the bottom line quite quickly.”

Hawke’s Bay’s last drought was during the summer of 2019 and into the beginning of 2020.

Only 44 per cent of the monthly average rainfall was recorded across Hawke’s Bay in April. The dry conditions since summer had affected most of the region but north of Napier, past Tutira, had fared better thanks to more regular rainfall according to Mitchell.

As a retired farmer who had been through Cyclone Bola and the subsequent drought, he said it was a good idea for struggling farmers to engage with their fellow farmers in the wider community through discussion groups or field days for support and advice.

“Talk to your friends and neighbours, don’t take it all on yourself,” he said.

“Apart from the social engagement when you realise you are not the only one battling away, you pick up the little tips, tricks and techniques that will eke out your feed or maximise the return you can get on a certain class of animal.”

He couldn’t say how long the tough period would last, but he believed there were some positive signs it could eventually turn around.

“The dollar is forecast to fall against the US dollar and that will certainly help our returns. The other one is interest rates, it probably won’t be this year but next year they should start falling so that would help the burden a little bit as well.”

He said the Rural Support Trust was available for those seeking help and advice.

“If we haven’t got it in our team we’ll certainly find it,” he said.

“The big thing is to control what you can control and don’t get too hung up on those things you can’t control.”

James Pocock joined Hawke’s Bay Today in 2021 and writes breaking news and features, with a focus on the environment, local government and post-cyclone issues in the region. He has a keen interest in finding the bigger picture in research and making it more accessible to audiences. He lives in Napier. james.pocock@nzme.co.nz