Words in isolation, or out of context, can get you in trouble.
Last Wednesday on the Farming Show I interviewed Fonterra's Miles Hurrell about the 2.9% drop in the Global Dairy Trade auction.
I went on say in my long-winded intro, and I quote verbatim, that "it's a bit disappointing really because most of us went to bed last night expecting a small rise in the global dairy trade auction. One man who woke up early to see what was happening and couldn't get back to sleep is Fonterra's Director of Co-operative affairs Miles Hurrell, and Miles this was a disappointment to everyone who woke up early, including the nation's dairy farmers".
My only crime, I thought, was to be too verbose in my introduction of Miles. Little did I realize my evil, bitter, cynical little producer Dom Boy George had taken liberties with my well-intentioned soliloquy!
So after some injudicious editing, what started as sympathetic industry commentary was dragged into the gutter and came out the other end as a quote in isolation, "most of us went to bed last night expecting a small rise".
Laughs all round in the Farming Show studio, mainly at my expense, but it was quite nice to be able to deflect with humour, some of the real disappointment the latest GDT auction had caused. All joking aside, most of us had gone to bed expecting a small rise, as the futures market has indicated the GDT might lift by 1-5% and whole milk powder by up to 7%.
That was not to be and we were subsequently informed that, once again, intervention by the Europeans was to blame. This was not the first time the futures market was wrong, although to be fair it's been a reasonable guide in recent times.
All of which got me thinking, why are we so bad at predicting the future, especially when it comes to the agricultural commodity markets? Isn't that what we pay Theo $5 million per annum to figure out? I know that volatility is the word that keeps getting rammed down our throats but the amount of volatility currently in commodities is enough to make climate change look, comparatively, like a glacial movement.
It's fair to say very few predicted the extent of this current dairy downturn, certainly not the length and depth of it. Like many recent investors in the dairy industry, I certainly didn't see it coming. I'd been around long enough to see the oscillation between five and eight dollars and was quite comfortable with something starting with six being the long-term average. But something starting with a three was not on my investment radar.
I'm also old enough to remember the 1980's when farming was dismissed as a sunset industry by the then Lange Labour government. Of my farming generation, those who have done the best were the ones who gritted their teeth, rode out the storm and subsequently enjoyed the tremendous capital growth of farm land over the past 30 years.
I'm not suggesting for a moment there will be tremendous capital growth in farm land over the next few years. In fact there are there strong arguments suggesting there could well be a paradigm shift downwards in the price of land, the likes of which we have not seen since the chill winds of Rogernomics blew through in the 1980s.
But dairy's day in the sun will come again. Look no further for proof than the kiwifruit and wine industries. Both are on cyclical highs at the moment. Both were on their knees five or six years ago - kiwifruit because of Psa and wine because of a grape glut and the Global Financial Crisis.
Now is no time for the faint-hearted. Hang in there and do whatever it takes it keep the wolves from the door. For dairy farmers that might mean raising a few beef calves or chucking some deer behind those tall netting fences on the run off block that've kept Friesians at bay for the past 10 years. For sheep farmers that might even mean getting back on the handpiece you thought you'd retired from.
Buy your banker a beer. He's your friend, not your enemy. It worked for me in the 1980s.
Finally, if you are feeling the pain down on the farm and see no way out, can I urge you to take an interest or, better even, partake in the FARMSTRONG Fit4Farming cycle tour. They set sail from Ngatea last Friday and will finish atop Bluff Hill on April 2. Luminaries such as All Blacks great Ian Kirkpatrick have lent their name and their legs to the cause. And it's all in the name of raising the awareness of good mental health for farmers.
There's plenty of help out there. Please don't be too proud to ask for it.