Farmers don't expect miracles

Waikato dairy farmer Lloyd Downing won't be holding his breath for a quick result when the WTO talks kick off tomorrow but he is quietly confident that the proponents of free trade will win in the end.

"It's a matter of when not if," he said. "The pessimists say it will never happen. But I'm an optimist."

Downing, who runs 530 cows near Morrinsville, has followed the politics of trade liberalisation for many years.

Day to day the prospect of trade reforms was not something farmers counted on when they planned their business, he said.

But farmers were aware that the last round of reforms - the Uruguay round - brought billions of dollars to the New Zealand agriculture sector.

Downing believed the biggest upside he would get from future trade liberalisation would come through the increased value of his Fonterra shares.

Trade reforms would give the dairy co-operative access to new, more lucrative markets in the US and Europe, he said. But he remained a realist about the ability of reforms to put cash in his pocket.

"It's not an immediate cure-all," he said.

If subsidies were removed over night there was only so much impact that could have on dairy prices - at least in the short term.

"Remember that dairy is just another protein source and if the price goes too high people can buy something else."

There were also limits to the amount of extra milk New Zealand could produce right now.

But he was confident that if the incentive was there production could be boosted significantly in an eco-friendly way.

Downing has met British farmer representatives and officials over the years and has some sympathy for them.

There was a fellowship among farmers around the world and it was pretty tough to expect them to go through the same harsh reforms that New Zealand farmers went through in the 80s, he said.

In that respect, he said, it was possibly not such a bad thing if the liberalisation process happened at a steady pace.