Farm expenses push higher

The quarterly increase compares with the three months ended June and pushes the annual rise in farm expenses to 7.1%, well ahead of the consumers price index which stood at 2.4% for the year to the end of September.

Statistics New Zealand says a 3.3% rise in livestock prices contributed significantly to the overall increase in farm expenses in the latest figures.

"Livestock prices rose 30.7% between the September 2000 and September 2001 quarters. When livestock prices are excluded, farm expenses rose 0.5% this quarter compared with the previous quarter."

The figures show that price increases for feed, grazing, cultivation and harvesting contributed just over a third of the overall increase in farm expenses but the increases were partly mitigated by lower interest rates.

Meat processing company Richmond (NZSE: RHD) said a few weeks ago in announcing its final year results that its margins had been squeezed in the three months ended September due to shortage of winter stock.

Chairman Sam Robinson said at the time that the final quarter had been the most difficult the company had experienced for many years and there were periods when it had operated on negative margins.

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