Latest / Best of Business / Jamie Mackay: The Country host on whether the Government will put The Country on the chopping block

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Jamie Mackay: The Country host on whether the Government will put The Country on the chopping block · Best of Business

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  Speaker 1: You're listening to a podcast from news Talk zed Be
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  Speaker 2: Jamie Mackay from the Countries with Us, Jamie, will the
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  Speaker 2: government look to put Land Corp up on the chopping block?
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  Speaker 2: I mean, well, I guess this is the question. Is
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  Speaker 2: the government going to look at selling land Corp? And
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  Speaker 2: if they do, is that a good idea? How will
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  Speaker 2: that go down with farmers? Jamie Giday gid a Ryan,
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  Speaker 2: thanks for being with me. So land Corp. It's one
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  Speaker 2: of the ones they're talking about putting it on the
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  Speaker 2: chopping block. What do you reckon? Good idea, bad idea?
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  Speaker 3: Well, it depends whether you're into selling state assets. I
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  Speaker 3: guess if you, Brian, if you are going to sell one,
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  Speaker 3: you would have to think seriously about selling the nation's farm.
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  Speaker 3: It's not performing very well at all and it's worth
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  Speaker 3: quite a bit of money. I had a guy on
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  Speaker 3: the show today on my show The Country called Will Wilson.
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  Speaker 3: He's a long standing agricultural consultant. He takes he's involved
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  Speaker 3: in several high profile governance roles in the primary sector
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  Speaker 3: and he was doing the sums on the performance of
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  Speaker 3: all of our leading ag companies, and he was almost
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  Speaker 3: quite scathing about Pamu. The artist formerly known as Landcorpy said, Look,
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  Speaker 3: it's it's got poor business strategy, poor governance and management,
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  Speaker 3: and it's a poor performing company. But the kicker is Ryan.
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  Speaker 3: If you take its assets less its liabilities, it's still
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  Speaker 3: worth about one point six billion dollars. We could do
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  Speaker 3: a lot with that. And the other interesting thing is
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  Speaker 3: it's worth about, according to Will anyhow, about one hundred
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  Speaker 3: and fifty billion less than it was a year ago.
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  Speaker 3: So maybe we're throwing good money after bad with Palmu.
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  Speaker 3: But if we sell it, who do we sell it too?
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  Speaker 3: It's a huge farm, it's New Zealand's biggers farm. Would
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  Speaker 3: it flood the rural market? And then it plays other
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  Speaker 3: roles in agriculture as well, such as research on behalf
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  Speaker 3: of the wider agricultural industry and also training young people
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  Speaker 3: onto the land. And so it's a bit of a
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  Speaker 3: vex question, but you would have to say, as it
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  Speaker 3: stands at the moment, it ain't a great investment.
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  Speaker 2: No, and it's I think it's sort of top of
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  Speaker 2: the list for the government when you know, because farmers
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  Speaker 2: run their farms much better than the government runs its farm, right,
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  Speaker 2: so why not let them have it?
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  Speaker 1: Yeah?
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  Speaker 3: Well, and there's also an argument because in the old
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  Speaker 3: days Land Corp used to be lands and surveys and
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  Speaker 3: they would have ballot blocks and they would put young
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  Speaker 3: farmers in and produce the or increase the productivity of
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  Speaker 3: the country. There is argument that maybe Land Corp should
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  Speaker 3: become a bank and for instance, with its dairy farms,
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  Speaker 3: and they've got some lovely dairy farms, put fifty to
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  Speaker 3: fifty share milkers in there, give them some skin in
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  Speaker 3: the game and really start to generate some money. But
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  Speaker 3: it would be fair to say that financially the performance
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  Speaker 3: of land Corp hasn't been that flash. Last year, Ryan,
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  Speaker 3: they lost, off the top of my head, something like
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  Speaker 3: twenty six million dollars, Yes it was, yeah, twenty six
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  Speaker 3: million dollars. And when you consider that they got thirty
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  Speaker 3: eight million from a windfall or windfalls from carbon credits.
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  Speaker 3: Putting that aside, the actual meat and taties of the
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  Speaker 3: farming business ain't going that well.
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  Speaker 2: Let's talk about something that is going well. Then dairy
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  Speaker 2: price is off to a very strong start. The Global
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  Speaker 2: Dairy Trade oction, the first two of them for the end.
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  Speaker 3: Yeah, Well, the first one was down and the second
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  Speaker 3: one was up, wasn't it.
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  Speaker 2: Yes, Yes, it was down one point four then up
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  Speaker 2: one point four.
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  Speaker 3: Yeah, and that sort of equalized one another out there.
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  Speaker 3: But the big one was in the last one Ryan
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  Speaker 3: one point four was GDT across the board. But the
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  Speaker 3: really important one we have a look at is whole
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  Speaker 3: milk powder price, as they went up five percent and
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  Speaker 3: this is the highest price on the platform since June
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  Speaker 3: twenty twenty two. And this has I guess convinced ASB
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  Speaker 3: they've led the charge. They're saying that their milk futures
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  Speaker 3: or the future milk price forecast price for this season.
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  Speaker 3: They're saying ten dollars twenty five, remembering that everyone else
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  Speaker 3: in the market, including Fonterra, is pretty much ten bucks.
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  Speaker 3: Ten dollars twenty five would obviously be a record price,
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  Speaker 3: maybe not an inflation adjusted terms, but a very good
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  Speaker 3: one for all that. Now, their chief economist, a guy
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  Speaker 3: by the name of Chris Tennant Brown. You would have
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  Speaker 3: seen him on the tally. He's saying, look, this isn't
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  Speaker 3: a dundelle. This four months left in the season. Prices
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  Speaker 3: could still move the season to date is up production
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  Speaker 3: wise three point seven percent, but we're well pass the
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  Speaker 3: midpoint of the Bell curve in terms of production. Typically
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  Speaker 3: only about a third of the production comes from here
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  Speaker 3: on and so a lot of that production and sales
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  Speaker 3: have been locked in. But there are a few other
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  Speaker 3: things to consider. Kneewers, soil moisture deficit charts have been
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  Speaker 3: showing a lot of the country could do with the drink.
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  Speaker 3: We've also got the exchange rate. Goodness knows what happens
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  Speaker 3: there with Donald Trump in charge. And we've also got
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  Speaker 3: a couple of other issues in Europe which has forced
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  Speaker 3: them back into the market a wee bit, the threat
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  Speaker 3: of foot and mouth in Germany and the ongoing presence
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  Speaker 3: of blue tongue virus. There's a lot of things that
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  Speaker 3: play here, Ryan, but generally in terms of New Zealand industries,
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  Speaker 3: New Zealand, the New Zealand airy industries is looking is
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  Speaker 3: looking as good as anything.
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  Speaker 2: And thank goodness, we've got them. Gosh, don't we need
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  Speaker 2: a bit of that at the moment. Jamie, thank you
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  Speaker 2: very much.
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  Speaker 3: Cheers, Ryan, always good to chat.
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  Speaker 2: Cheers Jamie. It's Jamie McKay from the Country
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