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Barry Soper: Farmers have been feeling the pinch for too long

Barry Soper,
Publish Date
Thu, 13 Jun 2024, 5:00am
Photo / Getty
Photo / Getty

Barry Soper: Farmers have been feeling the pinch for too long

Barry Soper,
Publish Date
Thu, 13 Jun 2024, 5:00am

The Agricultural Fieldays in Hamilton was expected to be a pretty low key affair when it came to selling stuff to farmers.

Like the rest of the business sector, farmers are feeling the pinch. They are feeling punch drunk after three years of an unbridled Labour/Greens Government.

But over the past two days the music has come back into their ears, even if it's still pretty low volume. The news yesterday from the Beehive that they won't be paying the ETS tax from next year will come as a great relief, although a number of cockies admit they haven't got their heads around it yet.

Those who have, firmly believe that marginal farms that have been in families for several generations would have gone to the wall. They argue - why does New Zealand need to be the first in the world to set a price for taxing farmers on their emissions?

And farmers in this country are some of the most carbon efficient food producers in the world.

Why bite the hand that feeds us, feeding more than this country but leading our exports by a country mile?

Then the Fielday music turned up a bit with the announcement yesterday by the Finance Minister that a couple of select committees will come together to look at one of the major costs facing the rural community in particular, imposts from the banking sector.

Parliament's finance and expenditure select committee will work with the primary production committee to see why farmers are paying much higher interest rates than the rest of us. And hopefully why we are paying higher interest rates than the Aussies where our four leading banks are domiciled.

Figures out for bank net profits here last year was a paltry $7.21 billion, and we were meant to shed a tear because we were told the banking sector result appears to have plateaued, up only 0.28 percent from the year before.

Cry me a river, because the small increase, we are told, comes on the back of an almost 17 percent net interest income for the year of almost $15.34 billion.

So it's those of us with mortgages and business loans feeding the furnace.

Talking around the farming traps, it's clear the hands that feed us are coping it the most.

They call banks predatory, preferring urban portfolios well above rural.

Farmers generally borrow to invest in their properties, it's called productivity. And yet whilst they toil seven days a week to keep their heads above water, they are being caned.

Those talked to say their bankers are always telling them they've got their backs. But the farmers say that's where their target is, and with good reason.

They are encouraged to increase their overdrafts rather than securing a new loan, say, for a piece of machinery. The overdraft rate is around 12 to 14 percent! Even a farm loan of 9 to 10 percent outstrips what we would be expected to pay for a house mortgage in town.

Farmers, whether you like them or not, are the backbone of this export hungry country and they should be treated as treasures not as tyrants.

As one farmer said: "We love what we do, we love the country, get out of our way and let us get on with it."

And thankfully that, it seems, is what the current crop of politicians are finally doing.

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