Some current Farming trends

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Extracted from the Farm Tender weekly Newsletter - Sign up and get the email every Wednesday morning before 5 am. www.farmtender.com.au

By Dwain Duxson

We see trends emerging in Farming and Agriculture all the time. Some go on for a while, some never go away, and others are only around for a short period of time. Some return and drift off again. Here are some see at the moment

We are starting to see a lot of Hay and Harvest Equipment hit the market post Harvest and Hay making. This is not an unusual trend, but the trend is that we are seeing more than usual. Some of the items hitting the market were white hot items pre Harvest, and the ones that have finished Harvest might see a short window of opportunity to cash in. Items like Chaser Bins, Tippers, Grain Bag Inloaders & Outloaders, Augers, Pick-Up & Draper Fronts and Headers were all super hot items pre Harvest. It will be interesting to see if these items retain their price point post Harvest.

Some would think they paid overs for the pre Harvest gear, but with the demand around at the time, it's probably market price.

This one has been a trend for a while. In the past, a Farmer would sell their used Air Seeder after Seeding, knowing they would have the new one before the next Seeding time came around. Not anymore. They want the new one parked right beside the older one before they even consider selling it. Obviously, some have been caught out by the slower pace of the new Machinery supply chain.

Why aren't restockers restocking? I have been talking to a couple of Livestock Agents and a couple of prominent Ram Breeders during the week, and they are baffled as to why Farmers aren't opportunity buying Sheep at the lower rates when there is so much grass around. One Ram Breeder said, "The current Sheep and Lamb prices scream opportunity, and the smart ones are tuned in to buy when the market retreats. But even the smarties aren't putting their hands in their pocket right now, and I am baffled as to why".

I heard an interesting one the other day. One person said that interest rates are just getting normalised. They are going up to a rate where they probably should be after having enjoyed an extended period of very low-interest rates. I thought that was an interesting way to look at it.

Agents are tipping that Weaner Cattle could be back $400-$600 a head (on last year) this Weaner selling season. The flow of Cattle coming onto the market has been one of the catalysts for the recent price drop. EP3 report that in November, it was the highest yarding of Cattle for the year and 47% above the average month for 2022. Some are tipping the correction might be only short-lived, but some are saying the numbers are at a point where it's just too many for the market to handle.

Hay buyers only ever buy Hay when they need it. Hand-to-mouth style. Unless you're a Feedlotter or require Hay all year round. That's why the domestic Hay market is a feast or famine game if you are a seller. And that's the reason why we have seen lots of Hay Sheds go up in the last decade. Some sellers now play the Hay market, and some see opportunity in storing Hay, especially quality testing Hay. They then roll it out at peak demand times.

The current trend defies that a little in that we are seeing a small window where buyers are buying to stock up for the future. It's on the back of this season's low supply levels.

Financing the seasonal production side of Farming is increasing. We have seen it take off in Livestock and Crop Farming. We have seen this extend out to other things through the DelayPay business. Many Farmers are wanting a short-term arrangement where they can buy and then pay for that asset as quickly as possible and go again. One Farmer said that in Livestock trading, the financing part of the equation is cheap if you can find the right opportunity.

A new trend emerging is what we have labelled data funding or data financing. Farmers using Livestock or Grain software systems (think Agrichain - Grain and Mobble - Livestock) that record stock on hand, as well as ingoings and outgoings, have the opportunity to use the current stock held as security for seasonal finance requirements. We see a growing number of Farmers being stringent around selling at the right time, whether that's a price thing or a tax thing. But they are willing to borrow for capital requirements going forward rather than take a price hit because they need the cash.

FOMO has left the building. FOMO, or fear of missing out, was one of the reasons why Farm Land prices have risen so much over the last decade. Most blocks of Land that came up had multiple buyers as willing purchases, especially in the last couple of years. This has now changed, whereby the sheer volume of buyers has disappeared. Although Land prices haven't retreated (they may have slightly in some areas), we have seen a levelling out that reflects that the sheer demand is not around anymore.

I could go on, but won't. Enjoy your day.

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