1
00:00:00,040 --> 00:00:03,080
Speaker 1: So the dairy story continues. What looks like a golden run.

2
00:00:03,080 --> 00:00:05,320
Speaker 1: We've got new forecast this morning from darien Z telling

3
00:00:05,400 --> 00:00:07,320
Speaker 1: us the twenty five twenty six season could be one

4
00:00:07,320 --> 00:00:09,640
Speaker 1: for the history box. Basically, for the last quarter century,

5
00:00:09,640 --> 00:00:11,440
Speaker 1: you get a good year yet a not so good yet.

6
00:00:11,480 --> 00:00:13,960
Speaker 1: That's how the trend is gone. Darien Z had of

7
00:00:14,000 --> 00:00:17,560
Speaker 1: economics Mark's stories with us Mark morning, Good morning, Mike.

8
00:00:17,680 --> 00:00:19,800
Speaker 1: So what's happening into the new year. We got supply

9
00:00:19,920 --> 00:00:22,640
Speaker 1: demand balancing out nicely and it's all golden rainbows.

10
00:00:24,239 --> 00:00:29,600
Speaker 2: It's looking positive. It's always a bit it's always a

11
00:00:29,680 --> 00:00:32,360
Speaker 2: bit risky doing a forecast and looking ahead into the

12
00:00:32,360 --> 00:00:35,600
Speaker 2: next season because things so change. But we've had a

13
00:00:35,600 --> 00:00:38,600
Speaker 2: good season to one we're currently in in terms of

14
00:00:38,640 --> 00:00:41,240
Speaker 2: the payout price, it's looking like the Spine de Marn's

15
00:00:41,240 --> 00:00:45,040
Speaker 2: in good balance and were We released our forecast yesterday

16
00:00:45,159 --> 00:00:49,000
Speaker 2: and we're looking at another payout average payout of in

17
00:00:49,080 --> 00:00:51,880
Speaker 2: access of ten dollars, which is always a good place

18
00:00:51,880 --> 00:00:52,239
Speaker 2: to be in.

19
00:00:52,640 --> 00:00:55,639
Speaker 1: That's the truth. Average average break even points eight point

20
00:00:55,640 --> 00:00:58,640
Speaker 1: fifty ish. Is there too much debt in deiry? Generally?

21
00:00:58,920 --> 00:01:01,080
Speaker 1: I mean tens are number you need and if you

22
00:01:01,120 --> 00:01:03,760
Speaker 1: need to eight fifty every time you're asking for trouble,

23
00:01:03,800 --> 00:01:04,160
Speaker 1: aren't you.

24
00:01:06,240 --> 00:01:10,080
Speaker 2: Yeah, it is. So that's reflecting quite high high farm

25
00:01:10,080 --> 00:01:13,720
Speaker 2: working expenses and other debt repayment, interest costs, et cetera,

26
00:01:14,480 --> 00:01:17,720
Speaker 2: which really sort of spiked over the last few years.

27
00:01:17,760 --> 00:01:20,200
Speaker 2: So while it's a good return, it's a good income,

28
00:01:20,760 --> 00:01:23,160
Speaker 2: it's undeniable that the prices are still the expense is

29
00:01:23,160 --> 00:01:26,720
Speaker 2: still pretty high. The good news in that is we're

30
00:01:26,760 --> 00:01:28,920
Speaker 2: sort of seeing some of that farm price inflation sort

31
00:01:28,920 --> 00:01:34,600
Speaker 2: of start to ease off, and our interest interest costs

32
00:01:34,640 --> 00:01:37,560
Speaker 2: are coming down. So farmers have been making repayments on

33
00:01:37,600 --> 00:01:40,319
Speaker 2: their debt in the last season or two, and we

34
00:01:40,480 --> 00:01:42,840
Speaker 2: certainly encourage them to continue to do so. So there's

35
00:01:42,880 --> 00:01:44,920
Speaker 2: a good pay. There's a good story in terms of

36
00:01:45,560 --> 00:01:47,760
Speaker 2: getting their debt levels down as well, which is which

37
00:01:47,760 --> 00:01:49,720
Speaker 2: has been a key issue in the last couple of seasons.

38
00:01:49,720 --> 00:01:51,920
Speaker 1: You've got your hit around tariffs and what happens now.

39
00:01:54,080 --> 00:01:57,360
Speaker 2: That's kind of the sort of the warning signs with

40
00:01:57,440 --> 00:02:00,120
Speaker 2: any with any making any sort of predictions about the

41
00:02:00,160 --> 00:02:02,840
Speaker 2: future is we just we just don't know. So it's

42
00:02:03,200 --> 00:02:07,040
Speaker 2: volatile on the number fronts. Fairy like all our trade

43
00:02:07,080 --> 00:02:10,760
Speaker 2: sector is kind of hugely exposed to what happens offshore

44
00:02:10,800 --> 00:02:14,760
Speaker 2: and things outside of the farmer's control. So yeah, the

45
00:02:15,040 --> 00:02:19,079
Speaker 2: tariff discussion is of concern because so many things could

46
00:02:19,120 --> 00:02:22,160
Speaker 2: go could go, could go pear shaped, or there could

47
00:02:22,160 --> 00:02:25,640
Speaker 2: be opportunities in there in terms of other people's strife

48
00:02:25,680 --> 00:02:27,600
Speaker 2: as well. So it's really hard to say at the stage.

49
00:02:28,840 --> 00:02:30,840
Speaker 1: China isn't it. And I'm looking yet again at the

50
00:02:30,880 --> 00:02:33,680
Speaker 1: Chinese wanting to, you know, just seemingly print money and

51
00:02:33,720 --> 00:02:36,360
Speaker 1: give it to everybody within China. And I'm assuming some

52
00:02:36,440 --> 00:02:38,360
Speaker 1: of that flows through to us because I'm assuming the

53
00:02:38,440 --> 00:02:40,800
Speaker 1: desire for dairy from the middle class is still strong.

54
00:02:42,200 --> 00:02:44,320
Speaker 2: Yeah, I mean, trying is a big part of the market,

55
00:02:44,480 --> 00:02:48,640
Speaker 2: and if they're in there buying, it's that's what's getting

56
00:02:48,680 --> 00:02:51,600
Speaker 2: the good market divisions for us. So we'll watch that

57
00:02:51,919 --> 00:02:55,480
Speaker 2: and you know, the trade, the trade issues between the

58
00:02:55,600 --> 00:02:57,960
Speaker 2: US and China and Mexico and Canada with interests.

59
00:02:58,120 --> 00:02:59,639
Speaker 1: Okay, I good to talk to you. Make appreciate the

60
00:02:59,680 --> 00:03:02,720
Speaker 1: insight story. Deary in New Zealand, Hit of Economics with us.

61
00:03:02,919 --> 00:03:05,840
Speaker 1: For more from the Mic Asking Breakfast, listen live to

62
00:03:05,960 --> 00:03:09,000
Speaker 1: news Talks at b from six am weekdays or follow

63
00:03:09,040 --> 00:03:10,639
Speaker 1: the podcast on iHeartRadio