Fonterra chief executive Miles Hurrell says he feels "a heavy sense of responsibility".
Fonterra chief executive Miles Hurrell says he feels "a heavy sense of responsibility".
EDITORIAL:
Agriculture was New Zealand's economic life raft in the Global Financial Crisis and caught in the hammerlock of a global plague, NZ Inc is again counting on farmers to keep the bailiffs from the door.
Those farmers are entitled to feel we have a nerve given the pollution stickwe in our far-from-blameless suburbs and cities have been giving them, but, says DairyNZ chief executive Tim Mackle, their main sentiment is a sense of pride at being able to keep producing food for Kiwis and virus-stricken populations overseas.
Tucked away on an isolated farm is a nice place to be in a national lockdown, though farming families have the same fears and loss of freedoms as the rest of us. All thanks to an enormous effort by the agriculture support service industry to keep farmers and growers safe and working 24/7 to feed us.
So far so good. But this week there have been some chilly warnings we shouldn't be too quick to think we'll get an easy ride out of this mess on the sheep's (more likely cow's) back.
When Fonterra chief executive Miles Hurrell said in a Herald series on how business leaders were coping with Covid-19 that he felt "a heavy sense of responsibility" that New Zealand was banking on the dairy industry, eyebrows were raised. We are, after all, banking on exactly that. Hurrell's point was while New Zealand's biggest company could control its own actions, it couldn't control potential long-term virus hits on global markets.
Next came rural banking heavyweight Rabobank, forecasting a difficult agriculture season ahead, with global dairy, beef and sheepmeat prices tipped to decrease, global demand to be significantly impacted by the pandemic, and lockdown measures to impede the efficiency of local supply chains for some commodities.
Then yesterday, Federated Farmers told Parliament's epidemic response committee that winter was coming - not just weather-wise.
The double whammy of widespread drought and the lockdown squeeze on meat processing capacity meant more stock was being carried into winter but feed was tight and grass and crop yields down.
Prices were expected to be crunched in world economy virus crashes. Meat that was earning $5/kg or so was now bringing in $3, when farmers could get cattle off the farm, and there were predictions this year's $7/kg milk price would turn into $5 next year.
While farming was working hard to keep things going, the sector would not emerge unscathed, the rural advocate warned.
Coming as ANZ's business outlook survey results showed record lows for expected activity this month with business confidence slumping 9 points to -73 per cent, this prognosis for the primary sector punched some of the air out of the Government's hope-filled announcement yesterday of just 50 new virus cases.
As ANZ put it, with companies reeling from the suddeness and ferocity of the storm that's engulfed them, uncertainty is extreme.
It's a morale blow to hear that uncertainty could infect a sector we hoped was a safe bet.
