2 Jul 2009

Tougher economic conditions facing farmers

3:50 pm on 2 July 2009

Federated Farmers expects tougher economic conditions will force some to quit their farms this year, but others are expected to survive and adapt.

President Don Nicholson told the annual conference in Auckland on Thursday that some will have to quit, replaced by newcomers to an industry which will remains the most important in the country.

Farmers are facing tough times as they are caught between falling export price and stubbornly high interest rates, combined with a strong New Zealand dollar.

Mr Nicholson listed other threats, making clear the federation's view on livestock being included in any Emissions Trading Scheme.

Prime Minister John Key told delegates the Government has a range of policies and initiatives to strengthen the primary sector.

However, he saw little hope for new ways to reduce foreign exchange volatility, rejecting the suggestion of a partly-managed exchange rate.

The Prime Minister told farmers that that withdrawing from international efforts to curb greenhouse gas emissions could hurt farmers rather than help them.

Mr Key said that the agriculture sector needs to be included in the emissions reduction process now under review, despite farmer calls for it to be excluded.

He considers that opting out of the Kyoto protocol altogether is not an option for New Zealand. He said the long-term goal is to reduce emissions to 50% of 1990 levels by 2050.

Mr Key said a new research centre for agricultural greenhouse gas emissions would help find ways for the farming sector to lower its contribution to global warming.