Home' Straight Furrow 70th Anniversary : Dec 19 2011 Contents Straight Furrow • December 19, 2011
STRAIGHT FURROW CELEBRATING 70 YEARS -- THE 1980s
THE 1980s saw high levels of long
term farm debt "hanging around
agriculture's neck like the prover-
Straight Furrow reported there were
not hundreds of cases of farmers
faced with leaving the land but thou-
There were no collective statistics
but it was estimated mid decade that
20 per cent were doing "nicely thank
you" 60 per cent were struggling and
20 per cent "may be going down the
About 62 per cent of the total farm
debt was held by 25 per cent of farm-
It was that group that a downturn in
prices and an increase in costs
impacted on most severely.
Not only could farmers not service
their debts the downstream effect
was great on suppliers and the like
who either were not getting paid or
their services were not being sought.
Financiers and banks were reluc-
tant to reveal their exposure to the
growing problem and none was keen to be seen as the
villain forcing a farmer out.
Any farmer who had more than 50 per cent debt was
seen as at risk unless he had some off farm income.
Working deficits especially in meat and wool farms
were the norm and there were the perennial problems
of a high dollar. Farmers were continually trying to
reduce debt and subse-
quent cut in spending had
the usual flow-on effects.
The general manger of
the Rural Bank Ray
Chappell echoed the mood
of the times saying the situ-
ation was a lot worse than
"There are a significant
number of heavily indebted
farmers who will be unable
to survive. Some of us have
been saying for two years
there is a group at the bot-
tom who will not survive.
That group is still there.
"The difficulty is that they
are not going and there a
number of reasons that is
"There is a reluctance on
the part of institutions to
force the issue too hard and
there's a lack of realization
that there has got to be a general
restructuring take place in farming."
He said he did not think there would be a massive
number of mortgagee sales in spite of many of the
farms not having a future. "I think that what we will see
as farmers realise they don't have a future is that they
will look to some means to extricate themselves.
"But at the moment this problem is not being
addressed by most people "
Deepening problem of debt
DIFFICULT times in the 1980s saw
farmers turning to all manner of
diversifications and none was
more contentious than the live sheep
Straight Furrow reported that mid
decade exporters were confident about
the trade in spite of a ban placed on it
by Agriculture Minister Colin Moyle.
Moyle imposed the ban after there
was a 2.47 per cent mortality rate on
board a shipment to Mexico.
Exporters were confident that under
their specifications they would receive
his approval for future proposed ship-
Wrightsons stock manager Ross
Hansen said he did not really believe
Moyle had suspended the whole of the
live export trade.
"Many of his comments are aimed at
Animal Enterprises [which organised
the Mexico shipment] and he had indi-
cated he will treat each company's pro-
posals on an individual basis."
There was disagreement among the
companies organising the shipments
with some saying 2.47 per cent was an
acceptable figure while others were
adamant that it was not.
Moyle also was not keen on the con-
cept of live sheep for slaughter which
was what the Saudi Arabian market
Firstly it went against the concept of
adding value in this country.
And there was strong opposition to a
live trade from the SCPCA.
There was also the situation in New
Zealand where the meat industry itself
was under great stress and the people
involved in it -- both companies and
unions -- wanted as much product as
possible going through processing
The industry has never really gone
exports as dairy cattle to South
America and China are today common-
Live sheep exports from here were
stopped in 2004 after 5000 died on an
Australian ship bound for Saudi Arabia.
In 2009 the Government announced
that it was considering ending the
if strict animal welfare standards were
met. Agriculture Minister David Carter
said the export of live sheep, cattle,
deer and goats for slaughter would
remain prohibited particularly until
ongoing negotiations with Saudi Arabia
over guidelines were completed.
The ban remains in place today.
Contentious live exports
WHEN farmers were faced with the reali-
sation that they had to leave their
properties it was urged that they be
allowed to do so with dignity.
Federated Farmers president Peter Elworthy
was talking to the government on ways to
"But where a farming family decides with good
professional advice they can be viable given the
chance and they are forced unjustly into a mort-
gagee sale, the federation will stand behind
"If, for example, they are not given the chances
of a creditors' meeting we will stand with the
local community if they are persuaded that the
mortgagee is pressing a sale without a very good
reason and there has not been prior agreement
amongst all parties that this should go ahead."
Mr Elworthy said a proportion of those affect-
ed were highly competent farmers and they
ought to stay on their farms in the interests of
everyone including financiers.
Feds treasurer Ken Macdonald said many peo-
ple had been running deficits year on year and
added to that was interest rates and sometimes
penalty interest. "It all compounds and aggre-
gates and the problem not only worsens but the
speed at which it worsens accelerates.
"In some cases we've had creditors unaware of
the true difficulties of the situation. We have had
other cases where they have been well informed
but have procrastinated and put off the evil day."
The answer was in this situation it never came
Importance of dignity
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