Diversify, develop a ‘side hustle’’, and don’t give up.
That’s the guts of Jim Galloway’s message in the wake of Federated Farmers’ latest national farm confidence survey. The survey canvassed the views 1400 dairy, sheep, beef and arable farmers and concluded that confidence “remains stuck in historically low territory”.
Galloway, president of Hawke’s Bay Federated Farmers, says this region would be doing it tough even without Cyclone Gabrielle. But when you add all the associated costs and stresses of that weather event to the price of farm inputs and what’s being earned in return, it’s hard not to paint a gloomy picture.
The national survey found just over a third of farmers are currently making a loss, 39% are breaking even and just 29% earning a profit.
That’s making recruitment and retention difficult, as people decide farming isn’t a viable career option. One of the ways to mitigate that is by paying people more, which Galloway agrees with. His only issue is that it becomes another cost that’s ‘baked in’’ for the long haul.
The price of everything associated with running a farm is increasing at a time when, in a Hawke’s Bay context, the return on commodities such as lamb and wool are decreasing.
“The beef is not looking too bad. The wool has got a long way to go. Even doubling what you get for your wool is only going to bring it up to break even,’’ Galloway told BayBuzz. “The lamb and mutton, there’s not a lot of hope out there for the next 12 months or so and Hawke’s Bay’s a big lamb and sheep area.
There’s a variety of reasons why the country’s sheep population has fallen from 70 million to about 25 million in the last 40 years, with Galloway indicating the impact of that is being felt in a once-unexpected way. “The sheep numbers going down is a major, because you’ve had a lot of land go out in the last 10 years into trees. Especially the last five years,’’ said Galloway. “That’s slowed down a little bit now, but there’s still land being sold for trees that used to graze sheep and beef cattle.’’
“Some parts of arable are going all right and beef farmers aren’t doing too bad.’’ Beef cattle are less labour-intensive to farm, and require less inputs, which is making them a more attractive option for farmers, says Galloway.
Farmers, he says, simply have to ensure they are agile enough to adapt to the circumstances they find themselves in. “There is a trend of people increasing their cattle and decreasing their sheep as a ratio on a farm and there will still be land converted into trees and some of that should be in native and some of that in pine,’’ Galloway said.
“People need to look at what they’re doing all the time and make sure it’s the best use of the land and it’s the best way of trying to extract a living out of it. So people, as I say, are changing their ratios, they’re doing a bit more cropping. Some are starting cropping and diversifying.’’
And diversifying not just in a farming sense.
If offering boutique accommodation or glamping sites on a property is a practical option, then Galloway says farmers should consider that too.
“Side hustles aren’t just limited to people in the urban areas,’’ he said.
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