AgriPulse

At the time of writing this message, most of the country was blessed with good reserves of soil moisture. For the first time in many years the majority of the country is having a good summer, and this is being reflected in the high store prices for cattle, and causing headaches at the meat processing plants due to lack of supply. This highlights one of the challenges of the meat industry in the ability to efficiently run their plants. However, farmer and growers are enjoying the chance to finish livestock and produce milk with minimal use of supplementary feed.

The strong financial returns being experienced this year are a good chance to build some financial resilience into the farm business and catch up on delayed R&M or capital expenditure. The dairy futures prices for 2027 are more modest, so make the most of this opportunity.

Looking at the geopolitics across the world, and locally, uncertainty and volatility are the new norm, particularly with elections later this year. We need to learn to live with this volatility and have the ability to rapidly adjust our businesses if needed.

For AgFirst, we are also looking at what the future holds and ensuring our own business structure and direction are fit for purpose. AI is definitely one of the key factors that will change the way we work in the future, and we will be embracing AI tools where it adds value. How will AI impact your business this year?

We wish you and your businesses success in 2026.

James Allen, AgFirst

98.8% of farmers voted in support of the arrangement by which the $3.2b capital distribution will be made resulting from the Lactalis purchase of the Fonterra consumer business. It involves a share buy back and share subdivision. The subdivision is required to ensure no shareholder falls below the minimum shareholding requirement as a result of the buyback. Those funds are expected to arrive in farmers bank accounts in March or possibly April this year.

Feedback from farmers suggest debt reduction for many will be a priority. Farmers will be well aware of recent commentary on the OCR and the implication that they may well be at their lowest point. It is probable there will be some equipment upgrades and technology investments as well. No doubt a reasonable proportion of the $3.2b will find its way into the economies of the rural service towns where it is reasonable to expect a solid multiplier effect.

The GDT auction on 3rd of February provided a very favourable, if somewhat unexpected, 6.7% lift over the previous auction. Notably all products showed a lift from a 1.5% lift for lactose through to a 10.6% lift in skim milk powder. This has been followed by a further 3.6% lift in the February 17 auction and a 5.7% lift in March 3rd auction. Most product categories showed a lift with a 9.1% lift in skim milk powder most notable. Skim milk powder was selling at $2431 /t at the Dec auction and has steadily risen to $3243/t now. This has been driven by supply constraints on dairy proteins. While milk volumes are lower at this time of year it certainly strengthens confidence in the $9.45 forecast milk price and could well lead to a lift in milk price expectations.

Pregnancy testing is well under way now. Early indications are empty rates appear to be running 1.5 – 2% higher than last year. In the upper North Island, high temperatures experienced in November may have led to some embryo losses. There were also periods of very low dry matter pasture samples over parts of the mating period which may have restricted cow intakes.

Cow prices remain incredibly strong with in milk empty cows fetching north of $2000 a head. Farmers are holding on to empty cows given the feed supply, leaving the works buyers pulling out all the stops to secure animals to process.

Recruitment of 50/50 sharemilkers have been particularly challenging this season with the suspicion that very high cow prices are making both sharemilkers and bankers nervous.

Overall, the Dairy sector is in a very positive frame of mind. Returns for milk and meat are favourable, a significant capital distribution is on the way for the majority of farmers and a challenging summer for holiday makers has resulted in good growth rates of high-quality feed meaning reduced costs of production.

Milk flows remain strong with the current production forecast of 1.96 billion kgMS up 1% from the previous year. Importantly this milk is being produced relatively cheaply with significantly less supplement being fed this year as a result of strong pasture growth.

The wide geographic spread of recent damaging weather events has resulted in very common discussions around preparedness. Generators to allow cows to be milked, milk to be chilled and effluent to be managed in extended power cuts has been a reoccurring theme in the last 2 weeks.

Dave Miller

The optimism in the sheep and beef industry as mentioned in the previous newsletter continues, as the typical decrease in meat schedules over the summer months did not occur and prices remain strong for both sheep meats and beef. Further to this there has been a continued upswing in wool prices, and now wool returns are at or slightly exceeding breakeven with associated costs. US prices for 90CL (ninety percent chemical lean- bull beef) are 45% above the five-year average and lamb prices are at 38% above the five-year average.

A recent relaxation of quotas of beef from Argentina into the United States (a shift from 20,000t ceiling before any tariff to 80,000t tariff free ceiling) may have some downward pressure on NZ prices received for beef, but most commentators believe this impact will be minimal.

The store market prices continue at high levels fuelled by the strong schedule prices, and by the above normal feed levels due to good summer rainfall across the motu. These strong store prices and high pasture covers are pulling stock away from the processors who are more actively than normal searching for stock to process. Therefore, there are procurement premiums of around 8% above normal for this time of the year.

The increased returns are stimulating discussions around increasing productivity, and key to this are efficient fertiliser strategies. Fertiliser prices have increased; superphosphate is up 14% over the last year and up 28% on the five-year average. Other costs, notably rates and insurance have also seen rapid escalation in prices.

With increased cattle returns the interest in cow collar technology is kicking in for the beef sector, a lag of a few years behind the dairy industry. Reliable tangible cost: benefit data is still scarce, but the hype remains and the “first adopters” are in boots and all with this new technology.

One year farm mortgage rates sit at 5.05%, two-year rates ate 5.45-5.5% and five-year rates are at 6.3-6.4%.

Lochie MacGillivray

While the 2026 stone fruit season is winding down in the North Island, pip-fruit, vegetables, and viticulture are all ramping up for harvest with mixed conditions encountered across the motu. For the North Island growing degree days and solar radiation are above average, however rainfall and climatic conditions have been challenging, notably in the East Coast.

South Island conditions have been challenging, with colder conditions encountered, delaying expected harvest times, meaning full production has yet to be achieved in Stone fruit. Hail was experienced through December, creating a few challenges. Heat will be needed to generate the necessary maturities across South Island growing areas.

In Gisborne and Hawke’s Bay early pip fruit varieties (Royal Gala types) are being picked with reports of good colour, size and quality while stone fruit is nearing completion. Late season plums will continue into March, and the viticulture harvest is kicking off with early white varietals beginning to come in. Yield caps are expected in the 2026 vintage to continue to assist balancing the supply and demand equation due to subdued demand over previous seasons – the upshot of this is the ability to select the highest quality fruit!

Zespri is holding their Momentum conference in late February which will include the release of Zespri’s 2035 Strategy, focussed on creating the healthiest possible future for growers, shareholders, post-harvest partners, customers, and the industry. Zespri has noted that the board intend to release 400ha of Gold3 licenses through the existing unrestricted pool alongside 100ha of the newly developed later harvest cultivar Red80. This 100ha will be split with 50ha in the unrestricted pool and 50ha in a restricted cutover pool for existing Red19 growers. The Cutover pool for Hayward/Green14 to Gold3 is no longer being offered.

The horticultural sector is still feeling the turbulence of preceding seasons and global volatility, evident in Mana Orchards, Rakete Orchards and Te Awanga Estate entering receivership this last quarter. That said, the outlook is positive into 2026, with all industries expecting increases in operating income, largely driven by quality and yield, rationalising some the significant increases in cost of production that have occurred since 2020.

Carl O’Brien

This latest period marks what is arguably the most productive and optimistic era for farmers and growers in the last five years. Although the agricultural industry is never short of impending challenges the overall outlook remains positive. Consequently agribusinesses supporting these producers, particularly in lending, livestock, inputs, equipment and technology are likely to see a significant surge in demand.

As I reported in the last issue the market in these categories is already extremely noisy. Most major players are swamping rural media channels with advertising focused heavily on product evaluation or conversion. Unless brands plan to counter this with massive spends or achieve distinctiveness through exceptionally bold campaigns they must adopt a more strategic approach.

These are the top four areas where we are currently focused with our clients to deliver a competitive edge outside of traditional media campaign activities.

Dialling up physical presence and availability

In many agricultural sectors simply being available when a customer is browsing online or in person has a massive impact on purchase frequency. Marketing science proves that a lack of physical availability often acts as a hard ceiling on growth. Brands can spend millions building mental availability through advertising but if the product is not on the shelf or the e-commerce site is archaic and confusing you cannot scale.

You must ensure your products are present wherever your customers congregate. We are seeing an increasing number of large agribrands adopt direct to consumer models or sign new distributor partnerships to increase their presence in high traffic areas. If you cannot compete on ad spend this lever is well worth pulling.

Deploying channel incentive programmes

Channel partners such as rural retailers and distributors hold significant influence over a farmer’s purchasing decisions. Since the majority of agribrands distribute through these partners it is imperative that they are engaged advocates for your brand.

Tactics should include everything from paid product training, using tools like Frntlne, to sales incentives and retailer reward programmes. If you distribute through a third party these initiatives should be a non negotiable part of your marketing calendar.

Focusing on customer retention and data activation

The Ehrenberg Bass Institute recently identified that focusing solely on loyalty is less effective than expanding your customer base. However a recent IPA study also proved that advertising to existing customers is actually more effective at activating immediate sales than targeting new prospects.

If you have an established database but limited ad spend, direct marketing initiatives are a brilliant way to generate quick wins. Furthermore, you can use this data to create lookalike audiences attracting prospects who share the same intent and profiles as your best customers. This often bypasses the need to pull them through the very top of the traditional funnel.

Peer influence and collaborations

In my opinion influencers are underutilised in agricultural marketing. The most trusted referral source for a farmer is their neighbour or peer followed by their banker, agronomist or advisor.

Collaborating with influential farmers may only cost you a small amount of product yet it is often more effective and carries a lower acquisition cost than mass-market advertising. Additionally some of our most effective rural campaigns have involved brand partnerships. These joint efforts allow two brands to reach each other’s audiences through giveaways or shared activations at events like Fieldays. Farmers appreciate a tangible reward and many are willing to invest upfront in a bulk drench order if it comes with a high quality barbeque, or as seen with Resupply, fast-track a fertiliser order to secure a premium Bushbuck jacket.

Conclusion

While these strategies require more creativity and effort than traditional media buying, they are proven ways to help agribrands win against much larger players. If you have limited resources in this busy market, adopting even a couple of these approaches can help provide a distinct competitive advantage.

Kurt Sandtmann – Managing Partner, Tracta

The recently released The Future Farm Systems Research Programme White Paper – The Path to 2050, published by the Ag Emissions Centre, provides a research-based roadmap for the future of farming in Aotearoa New Zealand. The white paper was co-authored by AgFirst consultant Erica van Reenen and Lee Matheson of Perrin Ag Consultants, combining independent consultancy expertise with specialist farm systems research.

The report examines how farm systems may need to evolve to meet increasing environmental expectations, climate pressures and shifting market demands, while maintaining productivity and profitability. It outlines practical, system-level approaches to reducing agricultural emissions, improving water quality and biodiversity outcomes, and strengthening resilience across pastoral farming systems. Key themes include innovation in farm design, pasture and genetics, technology adoption, and integrated decision-making that supports both environmental and economic sustainability.

Both the full white paper and the summary report are available on the AgFirst website:

📄 Full White Paper: https://www.agfirst.co.nz
📘 Summary Report: https://www.agfirst.co.nz

Together, this report provides valuable insight to support informed discussion and long-term planning across the sector.

Returning to the United States after a decade away felt like stepping back into a familiar landscape where someone has quietly turned up every dial. The optimism is still there, the friendliness still real, but the cultural volume is louder. Everything politics, food, identity runs hotter. And nowhere is that more obvious than in the way Americans eat.

Beef Everywhere

Beef remains the anchor protein in the American diet, and the numbers are extraordinary. In the week before CattleCon, consumer data showed:

• 62% of Americans ate ground beef
• 52% ate a burger
• 36% ate steak

Beef is not just a food choice; it is a cultural constant. Even with the national herd down by around two million head, demand continues to outpace supply. Carcasses are pushing record weights, 449 kg on average, with some animals reaching 1,300 lbs on the hook, yet the appetite keeps growing.

Over the past two decades, the U.S. industry has shifted sharply toward higher marbling grades. In 2000, 38% of beef graded Select (Good). Today it is 13%, with 74% Choice (Better) and 13% Prime (Best). What was once a premium grade is now mainstream. The eating experience is consistently good, and Americans reward that with loyalty. Retail beef sales exceeded $45 billion last year, with dollar sales up 12.4% and volume up 4.3%

Even under economic pressure and the cost-of-living crisis, consumers adapt rather than substitute. They buy deals, use coupons, stock up and freeze, shift to private label, and repurpose leftovers, but they keep buying beef

Lamb Nowhere (But Wanted Everywhere)

Lamb sits at the opposite end of the spectrum, not because Americans don’t want it, but because they can’t get enough of it. The U.S. sheep flock is small and heavily concentrated in the West. Many producers have destocked after years of drought, and the average operation is tiny by global standards.

The result is a protein with strong demand peaks but chronic supply gaps. Ground lamb is emerging as the gateway product, and ethnic and religious communities celebrating Ramadan, Easter, Christmas are driving year‑round consumption. Costco and restaurant buyers want whole carcasses. But finding the product on a supermarket shelf when on a roadie is a needle in a haystack exercise.

An American Lamb industry leader captured it perfectly:

“We don’t have a demand problem; we have a supply problem.”

A Country of Contradictions

That contrast beef everywhere, lamb nowhere mirrors the broader social contradictions shaping modern America. In San Francisco, the day before the Super Bowl, the city was split between two halftime shows: Bad Bunny on the field and Kid Rock online, endorsed by President Trump. It was a perfect snapshot of a country living two cultural realities at once.

The same duality shows up in rural America. The Yellowstone effect has turned ranching into a national aesthetic cowboy hats, belt buckles, and ranch‑chic fashion everywhere even as the reality is far more modest. The average cow‑calf herd is just 39 head, and many “ranchers” rely on off‑farm income, subsidies, or insurance to stay afloat. Some have destocked entirely after prolonged drought.

Consumerism as the Real Operating System

Beer and spirits are sold at the service station, cannabis has become a fully commercialised retail category with boutique dispensaries and branded packaging, and GLP‑1 weight‑loss drugs are discussed as casually as vitamins. It all sits inside a wider culture where consumerism is the real organising force whether it’s Big Pharma shaping daily routines, Big Food driving national eating habits, Big Tech curating attention, Big Booze normalising convenience drinking, or Big Weed turning a once‑informal pastime into a polished lifestyle product.

Within that environment, protein has become the wellness currency of the moment. The “inversion of the food pyramid” is everywhere, from RFK Jr.’s diet messaging to the Make America Healthy Again movement. Even Starbucks now offers a full range of protein lattes, a sign of just how deeply the protein craze has penetrated mainstream consumer culture. Protein signals health, discipline, aspiration and increasingly, identity.

Tallow: A Different Trend Entirely

Tallow sits in a different but related space. Its resurgence is less about ideology and more about finding a fashionable home for the sheer volume of fat coming off ever‑larger beef carcasses. Influencers have reframed it as “ancestral cooking,” but the underlying driver is practical: when carcasses average nearly 450 kg and Prime marbling is the norm, the system produces a lot of fat. The beef industry aspires for Tallow to become the oil du jour — a trendy solution to a supply‑chain surplus.

The Protein Gap and a Kiwi Takeaway

What really stayed with me was the sheer volume of fat the American system now produces, sitting alongside a national fixation on lean protein. It’s an odd pairing, but it makes sense of the food culture I saw and it’s exactly where New Zealand’s grass‑fed, naturally lean processing beef fits in. That thought hit home most clearly over a simple hamburger: their fat, our lean, working together in a way neither system can achieve alone. As a Kiwi farmer, I came back encouraged. The U.S. is only one of our hundred‑odd markets but seeing beef everywhere and lamb wanted wherever it appeared was a reminder that what we grow is valued. It gave me real confidence that farming well still matters, because the world is hungry for what we produce.