Primary produce prices sustainable

Farmers are enjoying the welcome lift in prices of primary produce, but are they sustainable?

Rob Davis, executive director of Meat and Wool Economic Service* thinks so.

That is good news not just for farmers but the wider economy.

Farmers are being cautious. Previous booms have been followed fairly quickly by busts so paying down debt is the first priority.

That means we’ve got a tale of two economies – there’s optimism in the rural sector but it hasn’t yet flowed through to the cities.

If Davis is right and good prices continue, confidence will grow, farmers will start spending again and that will flow beyond the farm gate into the wider economy.

* Beef + Lamb NZ has replaced Meat and Wool but the report I’ve linked to refers to Meat and Wool Economic Service.

2 Responses to Primary produce prices sustainable

  1. Fredinthegrass says:

    The farmers I have talked to,Hp, suggest debt reduction is uppermost on their mind. However with the Feilddays looming………..?
    It is the first time for awhile that the “ducks” have all been in a row.
    Hopefully some of this income will make it to the rural communities and towns.

    Like

  2. gravedodger says:

    This time “all the ducks in a row” is a first in that these favorable outcomes have come in the face of a high dollar (against the US) and with very minimal “controls” and /or Manipulation attempts by agencies trying to make water flow uphill.
    Is this a final realisation of the quality and reliability of supply that our primarary producers can deliver or will it just turn out as a complete coincidence soon to to be a return business as usual with our vulnerability as a bit player on world markets.
    I fear the latter but fervently hope we can enjoy a run of the good economic results we are presently enjoying for a while, god knows it is welcome and much needed.

    Like

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