July 29, 2025 • 5 mins
Jarden’s managing director looks into his crystal ball ahead of next week’s GDT Auction.
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Episode Transcript
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Speaker 1 (00:00):
Alright, Mike McIntyre dairy thoughts, Jardon dairy expert analyst and
(00:05):
some interesting commentary in Mike's last I think piece joins
us Now today, Mike, how are you?
Speaker 2 (00:14):
How much? How are you?
Speaker 1 (00:15):
Yeah? Good? Thank you? Good good. Now, I'm drawing a
bit of a you know, the yellow Jersey corn corn
farmers in the US, and a bit of long bow
stuff going on here. Tell us about that. Tell us
about that, because I love the Tour de France. By
the way, we could have a ten minute interview about
that without even getting on to dairy prices and corn
and the like.
Speaker 2 (00:36):
Oh, I guess it's just a wide range of listeners
and readers. So we try and keep it as interesting
as possible. And you know, some of the data gets
a little bit dry, so we try and tie a
few interesting things together. But you know, the night last time,
I spoke about the impact that corn's going to have
on global production, and corn prices continue to fall, and
so that is obviously the big feeder stock for the
(00:56):
US cows. About seventy percent of the diet comes from corn,
and with the bushel below four dollars, it's a key marker.
And you know, we acpect a lot more milk to
come out of that part of the world.
Speaker 1 (01:07):
Okay, so what does that mean when a lot more
milk comes out of that world the bushels are down
below four dollars? What does that look like?
Speaker 2 (01:14):
What is that?
Speaker 1 (01:14):
What does that doing to us? Yeah?
Speaker 2 (01:16):
Well, so now they've sort of twice the herd size,
so ten million cows versus our five, but they produce
close to five times of the milk just obviously bigger
cows and more intensive feeding. So when their feed over
income sorry income over feeds levels get up to where
they are currently, then obviously they're incentivized to produce more milk.
What that means to us is we'll likely see more
(01:38):
skim milk come out into the market. And that's something
that I think we saw play out last night with
a softer skim pulse, skim price and the pulse. You know,
it's early doors, so you know, we can't read too
much into it, but it's just something we keep an eye.
Speaker 1 (01:51):
On, okay right here, So we'll keep a bit of
an eye on that. And of course we've found out
our own good weather here too, have we, I mean,
which is leading to plenty of production as well.
Speaker 2 (02:04):
We have, so we had a lot of rain here
in the north poind and especially which put an end
to that dry weather that we saw through the latter
part of summer an earlier part of autumn, and so
I think, you know, water table has been replenished, and
then in the last week eight days we saw a
fantastic drying out period and also temperature has got a
bit cooler. I mean, obviously that stops grass growth, but
(02:25):
what it does is kills all the bugs and gives
a chance for some of the fields to dry out,
because obviously it's important that you know while the where
there is assisting in the grass growth, as you know
that it gives a period for the fields to recover.
And so we hit the ground running because you know
from observations and from speaking to farmers, cows are coming
earlier and carving well, and people have got plenty of
(02:48):
feet on hands. So we think the season is going
to continue the momentum we saw through June, which was
a stupendous amount of growth eighteen descent up on the
previous year. And so we think the New Zealand season,
out of a really good milk price, is going to
start well yep.
Speaker 1 (03:04):
Okay, So okay, So what's the stimulus? I mean, what
are we getting from China and the likes?
Speaker 2 (03:10):
Yeah, that's the Big un nine. So China always plays
it's quite their cards, quite close to their chest. And
anyone who says they have a really good idea as
to what's going on there, you know, I regard with
a bit of skepticism. You know, they've built up a
very strong domestic supply themselves and that's been impediment to
US exporting product into there. But I think now with
(03:31):
the fairly well deleveraged from exposure to the US, both
in terms of imports a dairy but also imports a grain,
that there's an opportunity there for New Zealand to really
further cement our competitive advantage in that market. That comes
both from our free trade agreement and also by the
fact that we sent a very good trading relationship with
that part of the world.
Speaker 1 (03:52):
Yeah, the ten dollars payout ten dollars plus payout world,
I mean a short to mid term how do you
see that hanging in there?
Speaker 2 (04:03):
Well, you know, you look to the twenty seven season.
Now the future is there. They're at high nines, so
nine sixty odd, So again it's all you know, smelling
of roses at the moment, so you know, it's it's
not it doesn't have to last. So if people are
relying on these numbers, would certainly look them to manage
that risk. But it's not a new paradigm or anything
(04:26):
like that. These are commodities that we are selling into
the world, and so we will very much be at
the whim of what an international demand looks like. And
you know, at the moment that's pretty good, but there
are threats on the horizon, so we just have to
make sure that we're aware of those, and you know,
we're quick a mumble around them.
Speaker 1 (04:42):
Yeah, okay, the many jump at those futures at that
nine sort of six.
Speaker 2 (04:45):
Yeah, we're sinking. Yeah, that's right. We're seeing growing interest
in the future. So the twenty seventh season, which is
something that doesn't sizzle until September October twenty twenty seven,
so you know, a couple of years away from now,
you know, and then years gone by they weren't farmers
looking at that sort of horizon, but we're seeing greater
interest now as people become more sophisticated in a way
in which they manage the risk.
Speaker 1 (05:06):
I suppose somebody who's got pretty well controlled production costs
under that five dollar mark or something would look at
that pretty and you know, maybe maybe the other ones
who look at more strategically at that kind of future dollar.
Speaker 2 (05:19):
Yeah, if you're locking in your cost, you're locking your revenue.
It's pretty simple, sort.
Speaker 1 (05:22):
Of pretty simple strategy. Mike, thanks very much. There we go,
Mike Jardin there. Of course, they're expert and analyst
Alright, Mike McIntyre dairy thoughts, Jardon dairy expert analyst and
(00:05):
some interesting commentary in Mike's last I think piece joins
us Now today, Mike, how are you?
Speaker 2 (00:14):
How much? How are you?
Speaker 1 (00:15):
Yeah? Good? Thank you? Good good. Now, I'm drawing a
bit of a you know, the yellow Jersey corn corn
farmers in the US, and a bit of long bow
stuff going on here. Tell us about that. Tell us
about that, because I love the Tour de France. By
the way, we could have a ten minute interview about
that without even getting on to dairy prices and corn
and the like.
Speaker 2 (00:36):
Oh, I guess it's just a wide range of listeners
and readers. So we try and keep it as interesting
as possible. And you know, some of the data gets
a little bit dry, so we try and tie a
few interesting things together. But you know, the night last time,
I spoke about the impact that corn's going to have
on global production, and corn prices continue to fall, and
so that is obviously the big feeder stock for the
(00:56):
US cows. About seventy percent of the diet comes from corn,
and with the bushel below four dollars, it's a key marker.
And you know, we acpect a lot more milk to
come out of that part of the world.
Speaker 1 (01:07):
Okay, so what does that mean when a lot more
milk comes out of that world the bushels are down
below four dollars? What does that look like?
Speaker 2 (01:14):
What is that?
Speaker 1 (01:14):
What does that doing to us? Yeah?
Speaker 2 (01:16):
Well, so now they've sort of twice the herd size,
so ten million cows versus our five, but they produce
close to five times of the milk just obviously bigger
cows and more intensive feeding. So when their feed over
income sorry income over feeds levels get up to where
they are currently, then obviously they're incentivized to produce more milk.
What that means to us is we'll likely see more
(01:38):
skim milk come out into the market. And that's something
that I think we saw play out last night with
a softer skim pulse, skim price and the pulse. You know,
it's early doors, so you know, we can't read too
much into it, but it's just something we keep an eye.
Speaker 1 (01:51):
On, okay right here, So we'll keep a bit of
an eye on that. And of course we've found out
our own good weather here too, have we, I mean,
which is leading to plenty of production as well.
Speaker 2 (02:04):
We have, so we had a lot of rain here
in the north poind and especially which put an end
to that dry weather that we saw through the latter
part of summer an earlier part of autumn, and so
I think, you know, water table has been replenished, and
then in the last week eight days we saw a
fantastic drying out period and also temperature has got a
bit cooler. I mean, obviously that stops grass growth, but
(02:25):
what it does is kills all the bugs and gives
a chance for some of the fields to dry out,
because obviously it's important that you know while the where
there is assisting in the grass growth, as you know
that it gives a period for the fields to recover.
And so we hit the ground running because you know
from observations and from speaking to farmers, cows are coming
earlier and carving well, and people have got plenty of
(02:48):
feet on hands. So we think the season is going
to continue the momentum we saw through June, which was
a stupendous amount of growth eighteen descent up on the
previous year. And so we think the New Zealand season,
out of a really good milk price, is going to
start well yep.
Speaker 1 (03:04):
Okay, So okay, So what's the stimulus? I mean, what
are we getting from China and the likes?
Speaker 2 (03:10):
Yeah, that's the Big un nine. So China always plays
it's quite their cards, quite close to their chest. And
anyone who says they have a really good idea as
to what's going on there, you know, I regard with
a bit of skepticism. You know, they've built up a
very strong domestic supply themselves and that's been impediment to
US exporting product into there. But I think now with
(03:31):
the fairly well deleveraged from exposure to the US, both
in terms of imports a dairy but also imports a grain,
that there's an opportunity there for New Zealand to really
further cement our competitive advantage in that market. That comes
both from our free trade agreement and also by the
fact that we sent a very good trading relationship with
that part of the world.
Speaker 1 (03:52):
Yeah, the ten dollars payout ten dollars plus payout world,
I mean a short to mid term how do you
see that hanging in there?
Speaker 2 (04:03):
Well, you know, you look to the twenty seven season.
Now the future is there. They're at high nines, so
nine sixty odd, So again it's all you know, smelling
of roses at the moment, so you know, it's it's
not it doesn't have to last. So if people are
relying on these numbers, would certainly look them to manage
that risk. But it's not a new paradigm or anything
(04:26):
like that. These are commodities that we are selling into
the world, and so we will very much be at
the whim of what an international demand looks like. And
you know, at the moment that's pretty good, but there
are threats on the horizon, so we just have to
make sure that we're aware of those, and you know,
we're quick a mumble around them.
Speaker 1 (04:42):
Yeah, okay, the many jump at those futures at that
nine sort of six.
Speaker 2 (04:45):
Yeah, we're sinking. Yeah, that's right. We're seeing growing interest
in the future. So the twenty seventh season, which is
something that doesn't sizzle until September October twenty twenty seven,
so you know, a couple of years away from now,
you know, and then years gone by they weren't farmers
looking at that sort of horizon, but we're seeing greater
interest now as people become more sophisticated in a way
in which they manage the risk.
Speaker 1 (05:06):
I suppose somebody who's got pretty well controlled production costs
under that five dollar mark or something would look at
that pretty and you know, maybe maybe the other ones
who look at more strategically at that kind of future dollar.
Speaker 2 (05:19):
Yeah, if you're locking in your cost, you're locking your revenue.
It's pretty simple, sort.
Speaker 1 (05:22):
Of pretty simple strategy. Mike, thanks very much. There we go,
Mike Jardin there. Of course, they're expert and analyst
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