Sunday, August 14, 2022

Growers anxious of harvest conditions

New Zealand seed exports are booming, with growers experiencing some of the best prices ever, but current harvest conditions are dampening any celebration.

Good weather forecasting motivated a flurry of harvesting activity before the recent rainfall, which lasted 10 days.

New Zealand seed exports are booming, with growers experiencing some of the best prices ever, but current harvest conditions are dampening any celebration.

Federated Farmers herbage seedgrowers’ subsection representative John McCaw says good demand has pushed ryegrass prices to record highs, with NZ well-positioned for counter-season production to meet the growing northern hemisphere demand.

But the Methven mixed cropping farmer, who also runs a seed dressing plant on the family farm, is just a little nervous.

“This season, and 2023 contracts, are the highest prices we have seen, but relative to inflation and increased input costs we need to be up there,” McCaw said.

The market is beginning to differentiate based on yield, with pricing coming into line with varying requirements for more specialised varieties.

“There needs to be a premium for the lower yielding varieties requiring more sophisticated growing and that is happening now,” he said.

Lower yielding grass varieties are closer to $3 a kilogram ($3000 a tonne), while the higher yielding varieties are sitting at $2.50-$2.60/kg ($2500-$2600/t).

Demand and price for Nui in particular is at an all-time high and while traditionally exported to Europe, China is now also buying in this market.

“It’s been a very big year posing implications around farm storage, dressing capacity and seed testing,” he said.

The major concern for the industry though is shipping.

“The timeframe is critical to get seed turned around in time for the northern hemisphere planting.

“The supply logistics of getting space on a ship, the ship even turning up, is the major concern for industry with the merchants doing all they can to achieve deadlines,” he said.

NZ has a reputation for high-quality, reliable seed production and companies are prepared to pay a premium to get their seeds grown in NZ.

“There’s stringent traceability and accountability compliance around certified seed production that gives NZ the edge in the market, but we need to know we can deliver,” he said.

McCaw says the NZ Seed Authority’s Seed Certification Information System (SCIS), under construction over the past two years, will strengthen the edge and provide greater global assurance.

The SCIS is due to go live in the coming weeks.

While merchant firms are in “good healthy negotiations” competing for area for 2023 contracts, he said there’s an air of nervousness as growers look to complete this season’s harvest.

“The early grasses such as Nui have been disappointing in line with expectations from flowering in dull, drizzly weather in early December,” he said.

“Good averages at best are well back on potential yields, but we have seen marked improvement in the later grass varieties, while cocksfoot yields have been pleasing.”

The weather will be the biggest factor now for Canterbury cropping farmers.

“This will be a harvest split in two – before the rain and after the rain,” he said.

McCaw said good weather forecasting motivated a flurry of harvesting activity before the rain of the past 10 days.

“It was like turning off the switch, everything just ground to a halt and the forecast is rotten again for the next week,” he said.

“There’s a lot of potential (harvest) out there, but a lot of nervous farmers as they wait for harvest weather to return.”

Meanwhile, despite ongoing covid pandemic complications and shipping challenges, NZ’s seed exports are holding up well.

More than 55,000 tonnes of high-quality specialty seed were exported to 70 international markets worth more than $236 million in 2021, according to latest Stats NZ’s overseas trade statistics.

Export revenue for the year ended December 2021 was 5% lower than 2020.

About half of NZ seed exports by value go to the Netherlands (22%), Australia (11%), Germany (10%), and the US (8%).

Pasture seed, including ryegrass, fescue and clover exports, were valued at $133m, with vegetable seed exports including radish, carrot and beet at $96m and grain seed exports $6.5m.

Most of NZ’s export seed is grown and harvested in the Canterbury region.

NZ Grain and Seed Trade Association (NZGSTA) general manager Thomas Chin says the region has abundant seed production expertise, world-class seed quality management systems, the necessary supporting processing infrastructure and generally ideal climatic conditions. 

The combination of extreme climatic drought and flooding events causing significant disruptions to a range of northern hemisphere seed production regions in 2020 has created additional trade opportunities for NZ exporters.

“Our exporters have been able to keep and win new international customers because of a highly capable group of growers who are focused on supplying top quality product, which in turn delivers significant premiums,” Chin said.

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