1 00:00:00,480 --> 00:00:03,760 Speaker 1: Right, Oh, dairy prices around the globe are soaring, but 2 00:00:03,880 --> 00:00:06,040 Speaker 1: we are also footing the bill here in New Zealand 3 00:00:06,320 --> 00:00:09,159 Speaker 1: stats New Zealand food price figure show cheese is up 4 00:00:09,240 --> 00:00:12,920 Speaker 1: thirty percent on last year, butter prices are up forty 5 00:00:12,960 --> 00:00:15,760 Speaker 1: six point five percent for the year eight dollars sixty 6 00:00:15,800 --> 00:00:18,720 Speaker 1: the average price for a block. That's up five bucks 7 00:00:18,760 --> 00:00:22,279 Speaker 1: over the last decade. So Carl Dean is up early 8 00:00:22,320 --> 00:00:24,360 Speaker 1: for us, and that's no surprise because he is the 9 00:00:24,480 --> 00:00:29,320 Speaker 1: Dairy Group chair for Federated Farmers. Morning to your Carl, morning, 10 00:00:29,480 --> 00:00:32,000 Speaker 1: new gig for you, is it? Yeah? 11 00:00:32,080 --> 00:00:34,040 Speaker 2: You have for three weeks in the role here, so 12 00:00:35,120 --> 00:00:37,239 Speaker 2: definitely given, slowly give in the hang of it. 13 00:00:37,680 --> 00:00:40,559 Speaker 1: Now, this butter thing, I know it's good for farmers, 14 00:00:40,560 --> 00:00:42,400 Speaker 1: but it's bad for inflation. So what do you have 15 00:00:42,440 --> 00:00:43,120 Speaker 1: to say about it? 16 00:00:45,320 --> 00:00:49,040 Speaker 2: So what I've had it it's sort of an accumulation 17 00:00:49,120 --> 00:00:53,360 Speaker 2: of effects. There seems to have been a global trend 18 00:00:53,800 --> 00:00:58,160 Speaker 2: towards more consumption abutter, especially in the last five years, 19 00:00:58,200 --> 00:01:02,440 Speaker 2: but especially in the last months. You know, there's been 20 00:01:02,640 --> 00:01:05,960 Speaker 2: just a huge We've just got a huge difference in 21 00:01:06,000 --> 00:01:10,280 Speaker 2: the price that we have now. Yeah, we normally have 22 00:01:10,319 --> 00:01:11,200 Speaker 2: a high payout. 23 00:01:11,520 --> 00:01:15,360 Speaker 1: Well, the question we have a high payout. 24 00:01:14,400 --> 00:01:19,479 Speaker 2: It's because of a very you know, the last time 25 00:01:19,480 --> 00:01:23,199 Speaker 2: we had high paouts because we had a good list 26 00:01:23,240 --> 00:01:27,640 Speaker 2: and the commodities across the board. And at the moment, 27 00:01:28,520 --> 00:01:31,039 Speaker 2: two of the commodities are standing out really well, which 28 00:01:31,120 --> 00:01:35,520 Speaker 2: is look fat and butter and yeah. 29 00:01:35,520 --> 00:01:37,400 Speaker 1: You know, you know the question, the question that everybody 30 00:01:37,400 --> 00:01:39,840 Speaker 1: says when they go to the supermarket is Okay, we 31 00:01:39,920 --> 00:01:42,679 Speaker 1: understand the high international export prices. We think that's awesome. 32 00:01:43,080 --> 00:01:45,480 Speaker 1: Go the farmers. Yes, you are the backbone over our economy. 33 00:01:45,480 --> 00:01:48,080 Speaker 1: We know where our food is made. This is just great. However, 34 00:01:48,160 --> 00:01:50,400 Speaker 1: at the same time we make this stuff, and so 35 00:01:50,480 --> 00:01:52,400 Speaker 1: why do we have to pay the export price? 36 00:01:54,400 --> 00:01:58,560 Speaker 2: Well, that's a very good question. But unfortunately for New 37 00:01:58,640 --> 00:02:05,680 Speaker 2: Zealand consumers, the trend for butter is a relatively new 38 00:02:05,720 --> 00:02:08,960 Speaker 2: one in terms of globally. You know, if you think 39 00:02:09,000 --> 00:02:12,240 Speaker 2: that fifteen years ago when a lot of New Zealand's 40 00:02:12,560 --> 00:02:17,040 Speaker 2: dairy boom happened. Twenty years ago, milk powder plants were 41 00:02:17,080 --> 00:02:20,600 Speaker 2: built because they were the most efficient to make a 42 00:02:21,000 --> 00:02:25,960 Speaker 2: exportable product of raw milk. A butter plant takes a 43 00:02:25,960 --> 00:02:28,960 Speaker 2: lot of time, a lot of money to build and develop, 44 00:02:30,880 --> 00:02:33,520 Speaker 2: and you would have to wonder whether globally we are 45 00:02:33,720 --> 00:02:37,440 Speaker 2: sharing the shortage of butter and cheese processing plants. 46 00:02:37,520 --> 00:02:40,640 Speaker 1: Okay, so is this a butter bubble and if so, 47 00:02:40,800 --> 00:02:43,480 Speaker 1: if it is a butter bubble, will it burst or 48 00:02:43,560 --> 00:02:45,399 Speaker 1: can we get well, do we have to get used 49 00:02:45,400 --> 00:02:49,360 Speaker 1: to high butter prices going forward? 50 00:02:49,639 --> 00:02:53,720 Speaker 2: Well, I would say, unfortunately for dairy farmers and probably 51 00:02:53,720 --> 00:02:57,320 Speaker 2: fortunately for consumers, what goes up will normally come back down. 52 00:02:58,760 --> 00:03:00,840 Speaker 2: If we look in the past, normally these bubbles do 53 00:03:02,000 --> 00:03:04,000 Speaker 2: go up and then they come down down. And the 54 00:03:04,080 --> 00:03:07,680 Speaker 2: question normally is as consumed myself, I still have to 55 00:03:07,680 --> 00:03:12,320 Speaker 2: buy butter. The question is do we see how quickly 56 00:03:12,400 --> 00:03:16,760 Speaker 2: do the supermarkets or the wholesaler's pass those drops on 57 00:03:18,160 --> 00:03:21,760 Speaker 2: because of the butterprice drops twenty we all want to 58 00:03:21,760 --> 00:03:24,280 Speaker 2: see that supermarket drop at least, you know, for theme 59 00:03:24,280 --> 00:03:25,120 Speaker 2: percent at least. 60 00:03:25,080 --> 00:03:26,919 Speaker 1: Ye and we want to see it in quick time 61 00:03:26,960 --> 00:03:30,000 Speaker 1: as well. And should we warn farmers to be a 62 00:03:30,040 --> 00:03:32,320 Speaker 1: bit cautious because they've had a couple of windfalls in a row. 63 00:03:33,720 --> 00:03:37,839 Speaker 1: They can't expect this to be going forward consistently as well. 64 00:03:37,840 --> 00:03:41,200 Speaker 1: They have to make smart financial decisions, don't they. 65 00:03:41,440 --> 00:03:44,200 Speaker 2: Yes, I mean, the current hats are really built on 66 00:03:45,400 --> 00:03:49,680 Speaker 2: our loan news on door at the moment, and literally, 67 00:03:49,720 --> 00:03:51,680 Speaker 2: when I look at the graphs right now, it is 68 00:03:52,200 --> 00:03:56,560 Speaker 2: literally due to butter and cheese and milk fat holding 69 00:03:56,640 --> 00:04:00,200 Speaker 2: up the payout. So if those two drop away, the 70 00:04:00,240 --> 00:04:04,080 Speaker 2: payout will drop rather quickly and we'll go back into 71 00:04:04,120 --> 00:04:07,280 Speaker 2: the eight dollar mark. So what goes eight dollars? 72 00:04:07,320 --> 00:04:09,200 Speaker 1: And back on the eight dollars? Mate, we won them 73 00:04:09,240 --> 00:04:13,520 Speaker 1: back to the five dollars sixty PAMs, if you don't mind, I'm. 74 00:04:13,440 --> 00:04:15,920 Speaker 2: Meaning, I'm meaning for the dairy payout. 75 00:04:16,200 --> 00:04:17,240 Speaker 1: I go to, I go to. 76 00:04:17,600 --> 00:04:19,640 Speaker 2: Yeah, when we were getting paid eight dollars, I think 77 00:04:19,680 --> 00:04:22,120 Speaker 2: battle was getting around the five dollar mark. 78 00:04:22,279 --> 00:04:24,839 Speaker 1: That's right, That's right, all right, Carl, I thank you 79 00:04:24,880 --> 00:04:26,760 Speaker 1: so much for getting up earlier. Carl is the brand 80 00:04:26,760 --> 00:04:28,880 Speaker 1: new dairy chair for Federated Families. By the way. 81 00:04:30,000 --> 00:04:32,960 Speaker 2: For more from Early Edition with Ryan Bridge, listen live 82 00:04:33,080 --> 00:04:36,080 Speaker 2: to news Talks it'd be from five am weekdays, or 83 00:04:36,160 --> 00:04:38,080 Speaker 2: follow the podcast on iHeartRadio.