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Speaker 1: The Rural Report on Hither Duper See Allen Drive.

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Speaker 2: Jamie mckaye hosted the Country with Me evening. Jamie gooday, Ryan,

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Speaker 2: great result for Fonterra today.

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Speaker 1: Yeah, fantastic result. And I heard you talking to Miles

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Speaker 1: Hurrel just after five o'clock. I chatted to him on

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Speaker 1: my show today and yeah, look it's a great result.

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Speaker 1: Literally every number is good. But I just did a

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Speaker 1: wee bit of interesting homework around the Fonterra co op

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Speaker 1: share price. Now, these are the shares that the farmers

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Speaker 1: have to buy to supply milk to Fonterra. They finished

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Speaker 1: the day trading at six dollars ten. They were up

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Speaker 1: ten cents this time. A year ago they were three

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Speaker 1: dollars seventy five. But if you go back to their

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Speaker 1: real low point all time low seventeenth of November twenty

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Speaker 1: twenty three, less than two years ago, they were two

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Speaker 1: dollars and three cents, meaning in less than two years

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Speaker 1: the price of Fonterra co op shares have gone up

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Speaker 1: by three hundred percent, or exactly three times. Interestingly, when

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Speaker 1: I went back further in time, the high of all

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Speaker 1: time for Fonterra shares was way back in May twenty

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Speaker 1: thirteen when they were eight dollars. So I know there's

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Speaker 1: a big vote coming up on October the thirtieth for

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Speaker 1: Fonterira Farmer shareholders. They have to make their mind up

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Speaker 1: whether they take the three point two billion dollars from

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Speaker 1: the four point two billion they're going to get from

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Speaker 1: the sale or Fonterra is going to get from the

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Speaker 1: sale of lock Talis. But I think pretty much it's

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Speaker 1: a done deal. That's what I'm hearing anyhow, And some

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Speaker 1: of that money will be used to repay shares. Perhaps

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Speaker 1: some of them Ryan might have even bought their shares

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Speaker 1: and May twenty thirteen at eight dollars, so who knows.

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Speaker 1: But for those who bought them a couple of years

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Speaker 1: ago November twenty twenty three, they've done very well.

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Speaker 2: Indeed, it's interesting reading the results today and kind of

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Speaker 2: having a harm moment about the fact that profit was

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Speaker 2: actually down slightly. But then that's because their costs are

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Speaker 2: up because they're buying the milk, which is obviously at

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Speaker 2: very high prices.

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Speaker 1: Yeah, well, they don't always make more money when the

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Speaker 1: milk price is up because their ingredient is more. I

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Speaker 1: think some of that profit story. They're also paying a

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Speaker 1: week bit more tax, but a number that Miles didn't

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Speaker 1: mention to you. We've got the milk price at ten

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Speaker 1: dollars sixteen, we've got the forecast milk price at ten dollars.

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Speaker 1: But the dividend, Okay, that's the yield they get on

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Speaker 1: their shares. So you buy a share today, you're going

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Speaker 1: to on this year's on this year's dividend, get a

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Speaker 1: fifty seven cent per share dividend fully imputed. That means

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Speaker 1: it's tax paid. It's the equivalent to about seventy nine cents,

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Speaker 1: and that's up from about fifty five cents yesterday. So

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Speaker 1: that is a very good yield on your Fonterra share.

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Speaker 1: If you're a farmer supplying Fonterra, you and I Ryan,

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Speaker 1: and you're paid a lot more than I am because

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Speaker 1: you're a star at z B, we could go onto

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Speaker 1: the sheer market and buy Fonterra shares and the shareholders

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Speaker 1: fund today, Ryan, we should have bought him yesterday. They

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Speaker 1: went from seven to forty five up to seven ninety,

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Speaker 1: up forty five cents, an increase on six percent. So

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Speaker 1: the market obviously like the Fonterra results today.

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Speaker 2: Absolutely what's not to like? Hey, what's going on? Strong

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Speaker 2: wool actually worth something all of a sudden.

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Speaker 1: Yeah, suck, horror, Look this is they Look. The arable

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Speaker 1: farmers are having a wee bit a tough time, and

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Speaker 1: some of the horticulture farmers, like the avocado growers, having

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Speaker 1: a bit of a battle as well in some cases.

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Speaker 1: But generally across the board, things are really good. Red

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Speaker 1: meat's good, dairries really good, Kiwi fruit's good, Apples are good.

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Speaker 1: Strong wool has been, you know, has been the naughty

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Speaker 1: child if you want of primary sector returns. It's been

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Speaker 1: worth literally nothing. It's cost you more to share your

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Speaker 1: sheep than you get for your wall check. But today

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Speaker 1: at the South Island sale, the strong wall indicator was

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Speaker 1: up forty six cents. They had a ninety eight percent

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Speaker 1: clearance And some of the commentary was interesting from a

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Speaker 1: guy by the name of Dave Burrett who's the South

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Speaker 1: Island auction manager for PGG Rights, and he said significant

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Speaker 1: global shortages of all wall types has prompted levels of

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Speaker 1: demand at the christ Church Wall Exchange not seen in

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Speaker 1: a generation. Bidding at times was extreme, with buyers having

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Speaker 1: to fill immediate orders into China. A major Australian based

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Speaker 1: wall exporting company dominated the floor for most of the

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Speaker 1: fine wall, which has been going okay. It's been the

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Speaker 1: strong crossbed wall that's been the issue. So happy days

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Speaker 1: for farming today.

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Speaker 2: Ryan, absolutely, although it looks can be deceiving parts of

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Speaker 2: the country dealing with the green drought.

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Speaker 1: Well that's the beauty of being a farmer. You can't

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Speaker 1: control the weather, but you can't control commodity prices, you

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Speaker 1: can't control exchange rates. They're all out of your control.

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Speaker 1: But yeah, look it's been a bit of a tough

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Speaker 1: September for many. It's been cold and wet down south

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Speaker 1: where I am on the east coast of both islands,

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Speaker 1: like almost from Dunedin north it's getting quite dry. Areas

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Speaker 1: like one or two Taranaki especially one or two are

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Speaker 1: getting very dry. And it's also been cold, I mean,

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Speaker 1: hit by a lot of cold Southwesterlys. So what they're

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Speaker 1: kind of having in some places, especially in the North Island,

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Speaker 1: is a bit of a green drought. Other parts of

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Speaker 1: the country, the further north you go, have had more rain.

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Speaker 1: But I just think that's farming. You just got to

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Speaker 1: take what the weather gods give.

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Speaker 2: You absolutely and hope for the best. Jamie, thank you.

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Speaker 2: Jamie mckaye hosted the Country with Us. For more from

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