Federated Farmers Rotorua/Taupo provincial president Alan Wills. Photo / Shannon Gillies
Financial resilience of some businesses in our farming community is a real concern.
Alarm bells rang for me after a recent comment from a rural consultant was aired. He told me he was organising finance for some of his clients because Fonterra had re-adjusted the advance payment rate.
The payout
prediction and the advanced payments are still based on $6-plus.
Milk company payouts, the way they're structured and what impacts on them can mean they are volatile. It's pretty boom or bust for farmers, their families and communities. Couple this with the impact of adverse events that can turn-up in the form of a flood, or a drought, it all adds up to a difficult situation to climb out of.
It has come to my attention some farmers are just surviving – just able to make it from month to month so if there is a payment shock or an adverse event it can, and does, cause a stressed business and a stressed farmer.
