Lower milk price forecasts have dampened feed crop prospects as breweries look to reap greater volumes.
Federated Farmers arable vice-president for grains Andrew Darling said the falling milk price is rippling across the arable sector, evident in the crops going into the ground for the coming harvest.
The July Arable Industry Marketing Initiative (AIMI) survey shows sown and intended sowing feed wheat and feed barley crops are down 6% and 15% respectively on last season.
Sowings and intentions for malting barley, the barley used by New Zealand breweries, is up 77% on the 2023 harvest.
While that may sound like a lot more beer to be brewed, Darling said the hectares involved are relatively small.
“There’s probably still a reasonable market for feed grain in the North Island but it’s hard to transport South Island grain up there at a reasonable price, especially in competition with Australian grain,” he said.
Overall, 2023 harvest data shows that yields were up 6% over the six malting, milling and feed crops and the area harvested, at 96,022ha, was similar to 2022.
The net result was a 7% increase in total tonnage compared to last season, according to the AIMI report.
Feed wheat yields were up an estimated 1%, feed barley yields up 11%, milling wheat up 4%, malting barley up 6% and milling oats up 15%. Feed oats was down 2% compared to last season.
The estimated 2023 final tonnage of milling wheat, at 113,700t, was up 44% compared to last year’s harvest.
“But we knew what was coming, the weather last year was really poor.”
The amount of unsold milling wheat as of July 1 this year was 26,700t, 24% higher than the 15,500t at the same time last year.
More than half, 58% of sold feed wheat, is still stored on farm.
“A good amount of this will likely have been at a good contract price for the grower and the merchant will be starting to move that grain now.
“Dairy farmers, given the outlook, probably aren’t as keen to fill feed silos at the moment as they have been in past seasons.”
Two-thirds of the estimated 289,100 final tonnage of feed barley has been sold, with 38% of that grain still stored on farm.
The amount of unsold feed barley is 97,000t, considerably higher than July 2022 at 59,300t.
Growers in the North Island and in Southland are looking forward to better spring conditions after a wet autumn and winter, Darling said.
“There was plenty of winter rain in Canterbury too, but reports from that region are that most autumn crops have established well.”