Despite the drop in dairy payout Wanganui's SealesWinslow animal feed plant is selling about 50 per cent more feed than last year, chief operating officer Chris Brown says.
The plant in Kelvin St makes animal feed, mainly for dairy cattle in the lower North Island. Dairy farmers nationwide have been cutting back on that since the dairy payout dropped from a historic high of $8.40 per kilo of milk solids in the 2013-14 season, to a predicted $3.70 to $3.90 a kilo in the coming season.
But farmers are still buying feed for their calves, Mr Brown said. They know that calves born now will be milk cows in two years.
"It's almost a universal decision across the farming landscape. The payout could be back up to $8 -- let's not compromise the young stock coming back into the herd."
Sales of calf feed are 60 per cent up on the previous year, and overall sales volumes are likely to increase to their annual high in late September and early October, when cows that have calved and their calves are getting supplementary feed.
"We will probably have to go to 24 hours [production] to keep up."
While sales volumes are up, a lot of farmers are choosing to pay a little less for mid range rather than premium feed.
And prices overall have come down because SealesWinslow invested nearly $1 million in the Wanganui plant last year, upgrading production lines and improving efficiency.
"We've been able to lower the price and pass that on," Mr Brown said.
SealesWinslow is owned by Ballance Agri-Nutrients, a farmer-owned co-operative, and it has to weather the ups and downs of the dairy market. Mr Brown said dairy prices had a six to seven-year cycle.
"Farmers that have been through it before know you just need to hunker down and trade through it. We need to support our shareholders through the journey."
Other boosts to SealesWinslow business have come from beef rearers investing in supplementary feed. More people will be rearing beef cattle in the coming season, as farmers keep more bobby (male) calves than usual and grow them on for beef.
They will be keeping more this year to maintain beef production, after a season when dairy farmers have culled more of their unproductive cows than usual.
Poor weather and the lack of grass has meant sheep farmers have been buying feed "for the first time in many, many years".