And I thought the discussion was the likely profitability of PGW as a result of climatic and other conditions ???:scared:
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And I thought the discussion was the likely profitability of PGW as a result of climatic and other conditions ???:scared:
It is Kiora - but its fun to digress, I am a PGG holder though.
You need to differentiate between a one-off event clearly designed in the Govt's self interest in terms of maximising the float price of the gentailers and the significant amount of special provisioning and accommodation specially written into the Income Tax Act for farmers benefit on an ongoing basis.
1080 threat will hit dairy industry, how much pgw will be affected? I know dairy is not major part of pgw but still will impact more or less i think. seems not many discuss here.
I think many farmers have reduced herds to just their capital stock to see themselves through the drought. With dairying, the lower payout hasn't hit yet in cashflow terms. Another drought in FY2016, should it happen, will not be good for farmers. If FY2016 ends up being OK, farmers will need time to rebuild their herds. To me the best possible outlook in FY2016 would see farmers getting back to where they were a year ago. I don't see another great leap forward for PGW in FY2016.
PGW has had a great year in sharemarket terms. So time to rebalance my portfolio a bit by taking some PGW money off the table. PGW is still my preferred pure rural economy exposure, even at 50c. So no further rebalancing is planned by me, for now.
SNOOPY
I drove to Timaru via Rakaia,Barhill,Mayfield,Carew, and Geraldine today.
Drought.?What drought!The amount of capital invested into farming today has altered not only the landscape,but the whole model of farming.Intensive farming,better land use,huge increases in productivity.This in turn means more employment opportunities,and better markets for rural supply firms.Cows yes,but intensive crop farming too.
Yes there are parts of the country where the term "dry land" farming is still correct, but it can not be said of The Canterbury Plains.
Other parts of the country are changing too.The "dry lands" of Blenheim are now huge grape producers.
These changes help to even out farmer's incomes,and hopefully stop the huge fluctuations of past years.
Good comment Percy. Going off the rain radar time lapse imaging on the Metservice site yesterday much of the North Island got a good drink yesterday.