Analyst Intel

23 April 2021

PULSE | Dry conditions persist in autumn

By Sarah Friel 

Some rainfall since the end of February has taken the edge off dry summer conditions, but this recovery was mainly restricted to the western side of the country. In the North Island, Taranaki and Manawatū are well-placed, with grass after having a few wet days throughout April, but the eastern side of the island, from Gisborne south, is still languishing in what some have called a green drought. 

From February to now, Gisborne and Central Hawke’s Bay have had very similar rainfall compared to last year’s drought. Dannevirke and Masterton are worse off, observing a 47mm and 108mm deficit respectively. Further north, Bay of Plenty is also feeling a pinch, recording a 74mm year-on-year deficit in Rotorua.

Conditions in the South Island are more severe, with no tinge of green to take the edge off in Banks Peninsula and North Canterbury.

A lack of rain in Southland and Otago is also evident.

Akaroa has observed a 23mm deficit in the past 12 weeks compared to year-ago levels, while Dunedin and Gore are much drier than usual, recording respective deficits of 137mm and 197mm.

Some might be surprised by the size of these deficits, given the apparent health of green pastures. However, soil moisture levels are depressed. Anyone on the lookout for mushrooms may have come to this conclusion already, as anecdotally growth is well below normal. In current conditions, soil moisture and warm temperatures are only enough to support significant growth in facial eczema spores (FE) in parts of the North Island. At this stage, the spore count is increasing at a time when it is normally tapering off, particularly in Waikato.

According to our partners at WeatherWatch, the forecast for the next two weeks includes some positive change in the rain stakes, however, no significant downpours are likely. Southland looks set to benefit the most, with the potential to capture 30-50mm in the next fortnight, but Canterbury will be lucky to catch 2mm. The rest of the east coast could have anything from 10-25mm, which is unlikely to keep a drought warning at bay and will not reverse the low groundwater levels which have set in in Northland, Gisborne, Central Hawke’s Bay, Otago and Southland.

Agents from across the country have been lamenting dry conditions for contributing to a soft store cattle market.

In the North Island, R2 cattle prices have barely shifted since the end of February. Bulls, traditional heifers and steers have respectively traded for $2.50/kg, $2.60/kg and $2.80/kg for the past eight weeks. In the South Island, prices have slipped by 10c/kg for R2 cattle, with bulls and traditional heifers selling for $2.20/kg and traditional steers shifting for $2.30/kg. 

North Island steers and bulls are trading for 17c/kg less, and heifers are 12c/kg below average. In dollar-per-head terms, this equates to a $68 deficit on 400kg North Island bulls and steers, and a $48 deficit on heifers.

Downside is more severe in the South Island.

Traditional steers are trading for 54c/kg below the five-year average, equating to a $216 deficit on 400kg cattle. For bulls and heifers, the deficit is $108 and $164 respectively. 

Some of the weakness in older store cattle prices can be attributed to weaners’ entrance to the market in the past eight weeks and below average farm gate prices, but if the country was feeling more confident in feed and water supplies, it is likely demand for replacement cattle would lift.

F Benmore 383 R2 Bulls

SLOW SEASON: In the North Island, R2 cattle prices have barely shifted since the end of February, and downside is more severe in the South Island.