Cyclone Lusi brought disappointing rain results for the northern areas worst affected by the drought and more herds are being dried off to cope with the feed shortage.
Parts of the Waikato are as dry as they have ever been and feeding regimes and whether to dry off should be determined by achieving realistic targets of BCS at calving.
Reports suggest PKE supplies are getting tight and other more expensive feed alternatives are now in demand for quality milking supplements.
And in the south poor weather has affected the harvest and reports suggest a grain shortage looms as the traditional northwest has disappeared from the weather radar.
Winter dairy feed could also be tight as feed crops after cereals will be later sown, although with now regular rain, kale crops should provide heavier yields.
Despite high global prices US milk production has failed to follow with only a 2% increase expected, even with corn prices 20% lower than last year.
European dairy production is predicted to build at a similar rate even after the quotas expire and most of the lift coming from better producing cows rather than increased numbers.
Optimism for the future still abounds in NZ with a Mid Canterbury dairy farm including cows and shares reputably selling for nearly $75 million.
While this sounds an exorbitant amount for a dairy farm, some dairy land is reportedly for sale at $90,000/hectare in the Waikato but the creeping dry must be making buyers nervous.
But with interest rate rises now underway and the currency and farm costs moving with it, future expansion needs to be budgeted cautiously because history has proven agricultural commodities are cyclical.
The latest dairy trade auction eased again by another 5% to see values ease by nearly 10% in the last 3 auctions.
Volumes were double than that supplied at the similar auction last year but most commentators are suggesting the top has been reached and farmers should budget at least a $1/kg ms less for next year.
The Ministry for Primary Industries has charged Fonterra with food safety offences over the botulism scare, and to their credit the dairy giant has pleaded guilty.
How this will help in the still to be sorted court case with Danone is yet to be seen but all costs will be worn by the shareholders in a reduced payout for next year.
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