Home' Straight Furrow 70th Anniversary : Dec 19 2011 Contents Straight Furrow • December 19, 2011 39
STRAIGHT FURROW CELEBRATING 70 YEARS -- LOOKING AHEAD
THE National Bank along with ANZ
want to reach the lost generation
that has turned its back on agri-
culture, as the current crop of farm
owners are not getting any younger.
Commercial and agri managing direc-
tor Graham Turley said with the aver-
age age of New Zealand farmers now
topping 50, studies had revealed that
prospective farmers would need at
least a $1 million deposit to buy their
first dairy farm or $1.5 million for their
first sheep or beef farm.
He said as the cost of getting onto a
farm soared beyond the reach of young
investors, it forced many to seek alter-
native career options.
But with a new Farm Start-up pack-
age, available through both the
National Bank and ANZ, help towards
taking the first steps to owning a farm
was on its way.
"The industry needs skilled young
people to come in, develop business
skills, accumulate capital, and take
over as older farmers retire," Mr Turley
The Farm Start-up package has been
designed to help new farmers get
ahead in their first independent farm-
At least $60 million has been set
aside for lending in the first five years
to help a fresh batch of farmers start
their first agricultural business.
"We're investing in this because we
want to see the industry grow. We've
supported farmers in New Zealand for
170 years and we want to continue to
ISTARTED in the industry as a motor-
cycle technician during 1984, not a
particularly auspicious time for farm-
ing for those who can remember back
Prime Minister Rob Muldoon had
almost brought the country to a stand-
still with his think big policies and
although not in recession, it was cer-
tainly hard times for many.
After fewer than three months, I was
served with the bad news that farmers
were just not spending and I may need
to take a few weeks' unpaid leave until
things picked up.
Three years later, I left my job as a
motor vehicle mechanic to finally return
to the motorcycle industry with my
When a business is geared so that a
majority of its customers are from the
farming sector, it is certainly a rocky
ride and prosperity does not always
equal boom times.
In tougher times, it's not unusual to
sell good numbers of new motorcycles
and ATVs so that the farmer has a reli-
able and cost-free appliance with no
unexpected maintenance issues and
Conversely, in the good times, the
opposite can occur with maintenance
Right now, most farmers are getting
their fair share of the buoyant commodi-
ty market, but saddled with debt and an
uncertain future many still appear to be
cautious about capital expenditure.
The financial umbrella provided by the
banks in the mid-nineties was quickly
withdrawn when storm clouds gathered
and while we remain optimistic about
2012, Suzuki also understands that
worldwide, we aren't out of the woods
yet by some way.
ATV and farm motorcycles will, in our
opinion, continue to be the number one
choice of farm transport.
Practical, safe and inexpensive, they
offer the most economical solution.
While there is a small market for side-
by-side UTV, the initial purchase price
and ongoing maintenance costs will
restrict their ability to become more
popular than ATV as a form of trans-
IF the success of Ravensdown since
its inception was about processing
plants and chemistry, the future
breakthroughs will come from insight-
ful people with great ideas.
That's the vision of Mike Whitty, gen-
eral manager marketing, who believes
innovation will enable sustainable
growth for farmers and environmental
leadership for the co-operative.
"It's not just about farmers complying
with their environmental obligations.
It's about helping them achieve sus-
tainable profitability. This is only possi-
ble through practical insight and the
application of some smart ideas which
combine environmental leadership
with economic sense," Mike said.
Three such ideas include ECO-N,
Ravensdown's patented nitrification-
inhibiting system, the new range of
high-precision dynamic spreading tech-
niques and its award-winning C-Dax
pasture meter which senses and
records grass growth.
The Eco-N system has huge potential
to reduce nitrate leaching. While emis-
sions and leaching are sure to remain
hot topics, it's an often-overlooked fact
that Eco-N actually results in greater
Hitched on the back of an All-Terrain
Vehicle, the Pasture Meter scans the
ground showing how much feed a
farmer has for their stock and high-
lights poor performing areas so the
right amounts of the right fertiliser can
go on in the right places.
Combined with GPS-enabled preci-
sion spreading, farmers can minimise
inputs and maximise returns.
"As well as product and service excel-
lence, innovations like these mean
farmers can do even more for the envi-
ronment and their bottom line. This
combination is critical for the entire
range of farm inputs which today's
land use leaders are exploring," Mike
ANZ National Bank
Commerical and Agri
Suzuki New Zealand
THE rural real estate market is
now stable following several
years of downward pricing and
sales volume trends. Stability does
equate to transactions, and although
still nowhere near previous levels and
volumes, a noticeable increase is evi-
dent in sale numbers this year which is
Purchase price expectations for pro-
ductive rural land and assets are now
being calculated through business
model matrices -- that is return on
investment, and productivity outputs --
and not with an expectation of substan-
tial capital growth.
This is fundamentally a huge mindset
shift for a sector of the property mar-
ket which traditionally assumed that
land prices would only ever head in
Consequently, this mindset change is
taking a while to become accepted and
commonplace. This trend may well
continue for several years to come
until both vendors and buyers agree on
the new approach.
Saying that, with commodity prices
having grown strongly over recent
times, and expectation that this growth
will continue over the medium term
and will remain above historical aver-
International interest in New Zealand
primary production land remains con-
sistent. This interest is being driven in
part by commodity prices and returns,
but also due to our "green" image and
the opportunity to own a sustainable
and "safe" food production operation.
While there has been good offshore
interest in properties, New Zealanders
are still by far the overwhelming major-
ity of land buyers, and this will contin-
ue for the foreseeable future.
One can only speculate about rural
sector business confidence over the
short to medium term but while there
is some uncertainty around the ongo-
ing European debt crisis we are still
seeing good levels of confidence from
farmers and investors, albeit with a
degree of cautiousness.
Longer-term, the forecasts for global
primary produce demand look encour-
aging as the middle classes in India,
China, and other developing popula-
tions, demand more beef, lamb and
For now, it's "steady as she goes" for
the rural property market, but the out-
look for both farming and the New
Zealand country property market over
the next few years looks positive.
The business of farming is just that -- a business. And because our Agri Managers come from farming backgrounds
and spend their days out and about in your region, they understand what makes a successful one. They are also
aware that no two farms have the same working style, or even the same challenges.Which is why we believe the best
service we can offer is a flexible one. So get in touch with your local National Bank Agri Manager on 0800 80 77 11.
Like you, we're in the business of farming.
We understand that at times
farming can be a desk job.
Or a back of the ute job.
The National Bank, part of ANZ National Bank Limited.
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