The Country 31/03/26: Jen Corkran talks to Jamie Mackay

Rabobank’s animal protein analyst talks about New Zealand red meat fundamentals and the real flow‑on effects of the Middle East conflict when it comes to fuel, freight, fertiliser and on-farm costs. 

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Episode Transcript

Speaker 1 (00:00):
She is a senior animal protein analyst for Rabobank. No
one on that wonderful bank has a short title of
name is Jen corkran Jen. Hopefully I'm going to talk
to Dan Bolton shortly about the silver fern farms and
your result as we stare down the barrel and have
a dig into red meat on the show today. Look,
what's happening in the Middle East is causing us all

(00:21):
untold grief at the moment. How is it affecting the
red meat market or are we relatively insulated, especially when
it comes to the likes of beef into the US.

Speaker 2 (00:31):
Yes, hi, Jamie, so great to hear lots of red
meat on the agenda for today, but yes, globally it
certainly feels like thanks on fire, isn't it? And lots
of uncertainty. You know, if we look at red meat
and just the fundamentals of what's going on, things are
still pretty positive, and I think the time for the
sector to look to the positivity that we've seen over

(00:53):
the last twelve months. Understand some of those fundamentals, but
certainly the Middle East is causing uncertain te challenges with
all those words fuel and fertilizer and freight. But you know,
if we look at what's going on with the demand
for our rithmats globally, still right now, it's still very
strong and we've seen still some really good results in

(01:15):
terms of those everagex book values to date. What might
happen in the second half of the year, you know,
we can discuss going forward, but right now things are
still looking positive. Still got good demand in the United
States in particular for that grinding beaf still very very
hot and they're certainly driving things from the beach side.

Speaker 1 (01:33):
Okay, well, let's have a look at lamb. The lamb
schedules have dropped a wee bit in recent times. Is
this just the normal seasonal changes as we see live
stock starting to flow in, because I know a lot
of livestock has been held back because it's been a
good grass growing summer around New Zealand, farmers have quite
rightly decided to put an extra quilo or two on

(01:53):
the lambs, right.

Speaker 2 (01:56):
Jamie, and I think that's exactly what's happened. Right. So
we've seen some really great eight us it covers across
New Zealand through January degree and give into the start
of March. As well, now things have crisped off a
little bit are particularly in this last few weeks, and
now what we're seeing is that normal season or supply
starting to pick up, which these for processes they've been

(02:17):
waiting for these lambs to come on. But so far
in the season since October the first, we are down
about five percent, which is last year in terms of
the number of lambs that have been processed. But we're
expecting to see slightly more lambs this year, so there's
certainly still plenty out there. I think, you know, good
on our producers who have decided to put a bit
more life weight on these lambs and take advantage of

(02:37):
that good pasture that's been growing. But what we normally
see when these lamps start to come on online is that,
you know, the efficiencies pick up and the processing end
and they don't need to be offering the same money.
And we also know that they've perhaps held those prices
up firmly for some time now and it's time for
them to start to drop as they will normally seasonally,
and I think that's exactly what's happening. Unfortunately, it's kind

(03:00):
of happening just at the same time as the middle
East at this stage, it's not caused by that. It's
really just this normal season or softening that we see
in the markets.

Speaker 1 (03:08):
You've mentioned their word fuel, freight, fertilizer on farm costs.
Are these more likely to be felt in the next
financial year rather than this one? Bearing in mind from
a farmer's point of view, a lot of the income
and a lot of the costs of producing this year
have already been locked and loaded into the system.

Speaker 2 (03:28):
That's right, Jamie. I think what we know right now
generally a lot of things we don't know, but I
think really important to remain positive and focus on what
we do know. And we know that right now there's
enough fertilizer in New Zealand for the autumn. The fuel
situation is still being talked through by the government reguly,
so we kind of know we were out there. But

(03:49):
the real watching point for us in our team at
the moment is going to be the second half of
twenty six. And you know what that means that right
now where we are at, what can we do to
be resilient control costs going forward because we know that
the pace of some of these things is likely to rise,
and you know that is challenging. A lot of what
we do within the farmgate requires obviously even fertilizer itself

(04:13):
is going to be more expensive, but also getting that
foot on, and of course the trucking and everything out
and the rest of the supply chain when it comes
to moving animals around. So lots of watching points there.
But certainly the second half of the year I think
is going to be actually more of a worry than
we we're at right now.

Speaker 1 (04:30):
Twenty twenty five, the story was Trump's tariffs. Twenty twenty six,
the story is Trump's war. Goodness knows what he will
come up with in twenty twenty seven. Let's hope he
calms the farm a wee bit and we can all
get down to business. Jen corkran out a rabobank. Thanks
for your time today on the country.

Speaker 2 (04:45):
Thanks Damie