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Speaker 1: Darien Z's quarterly econ tracker is out. The last one

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Speaker 1: predicted a payout including dividends eight dollars thirty four a

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Speaker 1: break even point of eight dollars zero seven per kg

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Speaker 1: of milk solids. Now the payout is up eight dollars

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Speaker 1: eighty four predicted break even eight dollars ozho nine joining us,

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Speaker 1: Mark Story, darien Z, head of Economics, Mark, good morning,

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Speaker 1: Good morning, Roy, thank you for being with me. What's

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Speaker 1: pushing this? What's driving this?

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Speaker 2: Yeah, two things are driving that revised those revised forecasts.

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Speaker 2: The first is the improvements in the forecast milk pay

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Speaker 2: out price and protective from Frontira and announcements in August,

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Speaker 2: so the revenue side's going up. And the second is

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Speaker 2: the reserve banks forecast of interest rate costs adjustments and

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Speaker 2: banks beginning to respond to that. So those two, those

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Speaker 2: two factors are in combination are driving and improved outlooks

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Speaker 2: for our dairy farmers this season.

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Speaker 1: How much is that worth to your average farmer, the

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Speaker 1: reduction and interest rates.

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Speaker 2: Well, if we're looking at it, it obviously it depends

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Speaker 2: a lot for farm to farm, But if we're looking

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Speaker 2: at you know, I guess it's coming into well, we're

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Speaker 2: looking at rates of you know, an extra half percent,

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Speaker 2: more than a half percent in the remainder of this season.

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Speaker 2: We've done some analysis which has looked at what the

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Speaker 2: difference would be between you know, fast rates coming in

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Speaker 2: the December this year, if we were dropping down to

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Speaker 2: seven and a half percent from from eight point five

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Speaker 2: at present, and we're looking in the low tens of thousands.

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Speaker 2: But the more that flows into the season after that, yeah,

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Speaker 2: it obviously or makes a healthy difference.

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Speaker 1: So that it's quite significant then, isn't it that? How

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Speaker 1: are you feeling, how farmer's feeling? It must be it

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Speaker 1: must be a positive step. I guess a positive outlook.

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Speaker 2: Yeah, it's definitely always cautiously posit. It's early in the

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Speaker 2: season yet, so everyone's relying on forecasts of revenue and

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Speaker 2: forecasts of expenses at the same time. But it's looking

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Speaker 2: positive computer to previous seasons. Anything, any payout pies with

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Speaker 2: an eight in front of it tends to be good.

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Speaker 2: And if it starts getting up towards the nine, then

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Speaker 2: farmers are generally sitting in a fairly positive situation. Expenses

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Speaker 2: are still high and they are staying quite stubbornly high,

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Speaker 2: so things like wages, fertilizer, feed, et cetera haven't come down,

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Speaker 2: and perhaps as much as a bad of rights. In fact,

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Speaker 2: in this forecast where predicting that they've gone up. That's

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Speaker 2: reflecting you know, there's inflation staying in the system and

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Speaker 2: those prices are quite sticky. But overall farmers are getting

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Speaker 2: in a better position and hopefully can start paying down

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Speaker 2: some of their debt this season.

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Speaker 1: Good good. I am pleased to hear it. And when

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Speaker 1: I'm looking at an n ZIE forecast saying where at

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Speaker 1: zero percent growth as a country through to March next year,

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Speaker 1: I'm please to hear a little a spot of good news. MAK,

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Speaker 1: thank you very much. Mark stroy Durians he'd hit of

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Speaker 1: economics with us this morning. For more from news Talks,

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