Jamie Mackay: The Country host on dairy prices bouncing back after latest GDT auction

Prices have bounced back in the latest Global Dairy Trade auction - with an impressive 5.5 percent increase across the board.

The sixth event of the new dairy season, it is the largest percentage lift since March 2021, and a far cry from the the beginning of July when prices plunged 6.9 percent.

The Country's Jamie Mackay explains what this means for the primary sector.

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Episode Transcript

Speaker 1 (00:00):
Jamie McKay, host of the Countries with US. Hello Jamie, Hello,
how good was that milk auction?

Speaker 2 (00:07):
Bloody good? In a word or in two words? Yeah, Look,
it was the best GDT auction for two years. I
know you talked about it yesterday, Whole milk powder posting
its best single event gain since twenty twenty one. Interestingly,
Fonterra is still so that they're going to have to
move Obviously, they're sitting at eight dollars at the moment
for their forecast milk price for this season, that the

(00:29):
futures market is at eight dollars eighty. In this afternoon
or later on this afternoon, I found out that the
NZX milk price forecast has now lifted to a range
of well, I won't tell you the range, but the
mid point of the range is nine dollars thirty three Heather. So,
at those sort of numbers, dairy farmers are quite literally

(00:49):
starting to cook with gas. They are good numbers if
they know if they come to pass.

Speaker 1 (00:54):
Yeah, brilliant. I'm very very pleased with them. Why are
farmers so freaked out about this report into planting trees?

Speaker 2 (01:01):
Well, let me quote Toby Williams Federated Farmers, Meat and
Wael chair and he's probably the biggest critic I know, Toby.
He's based up there in Gisbon on the east coast
of carbon farming and forestry taking over good crazible land.
He's saying this report out called why Pines, it's a

(01:23):
white paper that was released today by our Land and
Water National Science Challenge, and he says it may have
been published as a report, but it reads more like
a horror story for his Zealand farmers and rural communities.
You know. The study, he says, makes it clear that
under the current policy settings will continue to see millions
of hectares of productive farmland plastered in pine plantations. And

(01:46):
he's saying planting pines as far as the eye can
see may well help reduce missions or improve water quality,
which is the idea of this report. But somebody has
to ask the question at what cost? And listen for
this one ether, here's my final shot. One of the
studies even found out that if there was no carbon price,
if carbon was worth nothing, it's currently trading at about

(02:06):
sixty bucks a ton, one fifth of sheep and sheep
and beef country would still need to be converted to
pine forest to meet our current freshwater goals. So you know,
sticky times ahead for sheep and beef up against the trees.

Speaker 1 (02:20):
I was under the impression that somehow the NATS were
going to crack down on this stuff and stop all
of the planting just getting out of control. Was I wrong?

Speaker 2 (02:29):
Well, I think they have cut down and I think
eating fair to the previous government and Damian O'Connor of
they kind of cut down on carbon farming, so we're
not actually I think the days of spray and walk
away people just buying some land, planting some pine trees
were basically walking away after thirty years, but collecting all
the carbon credits along the way are gone. But forestry

(02:52):
log prices are down at the moment, but by you
need to get two bites at the sherry. So if
you plant now, you're going to get hopefully a meaningful
return for your logs and twenty five or thirty years time,
but you're going to clip the ticket on carbon credits
on the way through. So it's a bit like sheep
farming used to be. Sheep farming here they used to
have two bites at the cherry as well. Meat and
wool Wallsworth next to nothing now, so the forestry has

(03:15):
taken over that mantle I.

Speaker 1 (03:16):
See, Jamie, thank you so much. We have chat to
you again next week. Jamie McKay host to the Country
for more from Heather Duplessy Allen Drive.

Speaker 2 (03:23):
Listen live to news talks.

Speaker 1 (03:24):
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