Jon Morgan reports on Fieldays 2012 prospects.
Farmers are likely to be cautious spenders at this year's National Fieldays, the four-day agricultural fair at Mystery Creek, Hamilton, next week.
Fieldays is a combination of the traditional agricultural and pastoral association show with the more modern farmers' market but on a giant scale. As many as 30,000 visitors a day interact with the 1000 exhibitors selling everything rural from cattle semen to combine harvesters.
Specialist events feature a marquee dedicated to presenting New Zealand food, competitions – dog trials, fencing races, tractor driving, excavating and chainsawing – rural fashion, talks and panel discussions led by Waikato University, and exhibits based on the 2012 theme, the changing face of farming.
Fieldays, rated No 3 or 4 among the world's big agricultural shows, cost $1.8 million to run. It takes four weeks to set up and two weeks to clean up. Canvas hire companies say it is impossible to get a big marquee anywhere in New Zealand at this time. They are all at Fieldays.
The organisers, a management team aided by a pool of 120 volunteers, are expecting fine weather. Bad weather drops attendances by 15 per cent, although most of those are urban people who don't spend as much as farmers.
A measure of the event's success is its impact on the national economy which, according to Waikato University, has varied over the last five years from $530m to $860m.
This year may be one of the lower.
ANZ rural economist Con Williams said a recent fall in dairy, meat and wool prices meant farmers would be more cautious.
"Farmers' bank accounts will still be in good shape because of the very good seasonal weather conditions, which provide a counter to the softer commodity prices. But the outlook is looking slightly weaker and they may be holding on to their cash to tide them over."
However, Fieldays would still be a success, he said. Many farmers made their annual equipment purchases at Fieldays in the expectation of getting good deals. Farmers had been spending on repairs and maintenance, fertiliser and feed over the past two years of high returns and, he predicted, would still spend on that this year.
Waikato University agribusiness professor Jacqueline Rowarth said farmers would be taking "big breaths" over the fall in commodities prices.
A typical example was a high-input dairy farmer with 330 cows who had told her the drop in the milk payout had removed $200,000 from his bottomline this year. "That's money he's not going to get and it's an indication of the state of the industry. There may not be much equipment replacement going on. Some of the deals the retailers were hoping to make may not happen."
Increasing compliance costs in the past year would also give farmers pause. Eight thousand kilometres of stream banks still had to be fenced at $8-$10 a metre if Fonterra's demand that all waterways be fenced by the end of next season was to be met.