The biggest issue facing farmers this season is not Covid-19, lockdowns or environmental constraints. The biggest and most immediate issue facing farmers is controlling costs. Anything that has been imported or has a link to importation is being affected by international demand and world shipping costs. These increases are having a direct and long-term affect on prices to farmers across the board. Although prices for export products continue to be firm and look favourable, margins are being eroded by the steady increase in input costs.
There doesn’t appear to be any change coming soon, in fact the impact of international trade demand and increased input pricing is set to continue until the end of 2023 with no short-term relief.
The table below shows how quickly the price in shipping has increased in the first half of the year. Even though planned construction of new ships is at a record high and container numbers are increasing rapidly, the impact won’t be realised on world trade until the end of 2023.
So, what does this mean ’down on the farm’? Already we are seeing an increase in imported product prices and one of the key products will be imported feeds from overseas. These feeds play an important role for sustaining milk production and animal liveweight during times of feed deficit on farm. To regain control of feed costs the best alternative is to either grow or purchase NZ grown feeds.
Maize for silage and grain is an excellent alternative to imported feeds. Maize for silage can be grown on farm for less than $220/t of dry matter in the stack and depending on where you are prices to buy-in will vary from $350 - $380/t of dry matter.
If you are considering doing this in your farming operation this season you need to act now. It will be too late to try and organise in the new year as domestic feed stocks will be in high demand.
Already we are hearing of some farmers who may grow less maize on farm and buy in their feed. This means future demand for maize silage will just continue to increase.
There is still time to put a few paddocks in at home and if you decide to buy in you need to be discussing this with your local supplier now to get a firm commitment of supply.
We have the maize hybrids suited for New Zealand conditions and the technical support you need.
* Based on an average 18 tDM/ha at a cost of $3,950/ha (including growing, harvesting, stacking, covering and inoculant costs)
** Indicative pricing only, please discuss this with your local grower and contractor.