Claytons – the El Niño you are having when you are not having an El Niño; inferior substitute, unsatisfactory compromise, or ersatz.
A sluggish start to summer but it has got warmer and drier once into the new year.
It did not however get anything like as dry as the El Niño forecast had suggested – hence our title and the explanation for those of you not from New Zealand or Australia.
It also now turns out that one in four El Niños are wet….apparently. In this case wet enough for grass to keep growing, meaning a second cut of hay in Hawke’s Bay without any recourse to irrigation.
Latterly and as we move into autumn, we have been experiencing some significant heat and much less rain than earlier in the season. In general this means production has been good and we head into autumn in good shape, with various permanent crop harvests looking very promising.
- See our note ‘Success in a time of economic distress’. The current environment in the NZ dairy sector represents a very rare alignment of advantageous investment occurrence for those applying an organic management strategy.
- The simple story is that the conventional dairy sector is the sickman of the NZ economy, whilst at the same time organic production is achieving significant premiums and investment returns. A most conspicuous case of winners (organic management) and losers (conventional high input strategies, i.e. the standard NZ ‘corporate farming’ model).
- The friendly growing season means that production has not eased back although supply out of NZ is not as big an issue for the global market currently as that from the EU and US.
- Excellent financial performance continues.
- This is particularly the case for organic fruit which is achieving a 41% premium with growing demand.
- Annual cash yields of 18.5%+ are being achieved.
- The agronomic/regional/climatic advantages identified by AE remain in place and the investment environment compelling – again, particularly for an organic focused strategy.
- AE has an attractive pipeline in the kiwifruit sector, in favoured locations.
Harvest time is underway (or imminent depending on the crop) with the permanent cropping sector performing well – notably apples, grapes and kiwifruit.
It is a good time of year, if very busy at the operational level and the investment picture has seldom looked more compelling for ecological practitioners.