Work trickles in for contractors after big dry

Bradstreet Contractors owner Peter Bradstreet lost $450,000 in throughput because of the drought.

Bay of Plenty contractors have secured more work after taking a big hit last year because of the drought.

Many Western Bay contractors lost up to half of their throughput after the big dry, with some losing hundreds of thousands of dollars.

Bradstreet Contractors owner Peter Bradstreet lost $450,000 and says his workload has been cut in half.

The situation has improved this year but farmers are still cautious about what work they need on their farms, he says.

"It's going along okay at the moment but there is certainly room for improvement."

Farmers are doing only the basics when it came to hiring contractors, he says.

"They are not doing anything over and above. The basics are getting done and that's it. The farmers are saying: if it ain't broke, don't fix it."

Bradstreet is about 70 per cent of the way through the annual hay and silage harvest, and has "clawed back" some of his deficit, although his final figures are unavailable.

"It's a little bit too early to say at the moment as I haven't done all the figures ... I'm too scared to," he says. "We are definitely ahead of last year but not back to where we were."

He describes his mood as "optimistic" but says farmer confidence is average.

NZ Rural Contractors Association president Steve Levet says farmers are not opening up their wallets. Contractors have been kept busy with supplementary feed as farmers are filling up silage pits, hay barns and fertilising, but they are not putting cash into capital expenditure.

"They are spending money on the have-to-do, not the wish list," he says.

Federated Farmers Bay of Plenty provisional president Rick Powdrell says some farmers are still in catch-up mode after the drought.

Dairy farmers are on a high payout but he does not envisage non-dairy farmers spending a lot of extra money, and hopes those who have it will take the opportunity to pay down debt. "There is not a lot of sign that there is spending going on."

Some farmers have not restocked fully, he says, and because they sold animals at low prices it is a challenge to find the money to replace them.

Interest rate hikes are also a concern. "It's quite clear interest rates are going to start to move, so farmers are conscious of that fact.

"There is a pleasing degree of caution being expressed by farmers to what the situation might be going forward."

Every farmer has budgeted an amount of feed to conserve for winter, he says. "If you get a good season like this, any feed you make after that is actually at significant cost because you may not use it."

Alternatively, some would make hay as it stored longer or try to sell surplus feed, he says.