{"id":537660,"date":"2026-07-21T23:29:09","date_gmt":"2026-07-21T23:29:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/537660\/"},"modified":"2026-07-21T23:29:09","modified_gmt":"2026-07-21T23:29:09","slug":"el-nino-weather-pattern-could-raise-farm-input-costs-but-new-zealand-agriculture-sector-seen-as-resilient","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/537660\/","title":{"rendered":"El Ni\u00f1o: Weather pattern could raise farm input costs but New Zealand agriculture sector seen as resilient"},"content":{"rendered":"\u201cThe discussions are for a strong El Ni\u00f1o, but overall we don\u2019t think it\u2019s going to have massive impact on the amount of livestock you have on the ground,\u201c Vogel said.<\/p>\n
\u201cUsually it\u2019s an issue of finding feed and paying more for feed.\u201d<\/p>\n
El Ni\u00f1o hits the hottest and driest parts of the world, such as Southeast Asia.<\/p>\n
\u201cWe\u2019re basically talking a lot around Malaysia and Indonesia, which are the largest producers of palm oil and with it, the byproduct palm kernel expeller [PKE],\u201d Vogel said.<\/p>\n
This region produces and exports about 80% of the world\u2019s supplies of PKE, a supplementary feed that is used extensively in the New Zealand dairy sector when grass is in short supply.<\/p>\n
If it gets dry in the palm-oil producing countries, it could take four to six months for farmers to feel the impact of higher PKE prices, Vogel said.<\/p>\n
In Australia, growing conditions are favourable in most states, but the onset of dry conditions there could affect grain supply, he said.<\/p>\n
Grain prices are already high because of the Ukraine-Russia war.<\/p>\n
New Zealand achieved record dairy production in the 2025\/26 season and Vogel expected milk volumes to remain strong.<\/p>\n
\u201cHowever, with the drier conditions, the question is do farmers just balance it slightly, because the concern will likely be on the feed cost side in those drier regions,\u201d Vogel said.<\/p>\n
Some El Ni\u00f1os have not always had a \u201cmassive\u201d impact.<\/p>\n
\u201cThat\u2019s the thing with El Ni\u00f1o \u2013 sometimes the reality is slightly different from what the textbooks tell you, so we keep a close eye on it,\u201d Vogel said.<\/p>\n
Prices have remained strong for meat but were a little softer for dairy.<\/p>\n
\u201cIf we\u2019re unlucky and it is extreme, the impact will be felt quite a bit, but it\u2019s likely to be more of a farm cost issue in our view, rather than a real production change that is felt in terms of supply,\u201d Vogel said.<\/p>\n
In Europe, he said the current heatwave was putting upward pressure on animal feed costs, which could affect feed availability.<\/p>\n
NZX Dairy\u2019s head of dairy insight Cristina Alvarado said New Zealand has started the new dairy season strongly, with June milk collections up 4.5% year-on-year.<\/p>\n
June remains the smallest production month of the season and volumes will increase significantly over the coming months, she said.<\/p>\n
\u201cLooking further ahead, forecasts of El Ni\u00f1o conditions developing towards the peak of New Zealand\u2019s production season continue to present uncertainty around milk output later in the year,\u201d she said.<\/p>\n
Separately, El Ni\u00f1o is not expected to affect the country\u2019s weather-dependent electricity generation system.<\/p>\n
Chantelle Bramley, Transpower\u2019s executive general manager operations, said the grid operator produces a range of security-of-supply modelling, including forecasts produced using data from historical hydro inflow patterns over the last 94 years.<\/p>\n
These include all the El Ni\u00f1o events over that time, meaning such an event is inherently considered in its modelling.<\/p>\n
\u201cHistorically, El Ni\u00f1o conditions in New Zealand typically bring increased rain to the southwest of the South Island, where the bulk of New Zealand\u2019s major hydro catchments are located, and drier conditions to the east,\u201d she said.<\/p>\n
Transpower data showed the daily average inflows during El Ni\u00f1o periods are typically above the mean at the start and end of the year.<\/p>\n
Bramley said there were some above-average inflows during winter, however there was some variability.<\/p>\n
Stay ahead with the latest market moves, corporate updates, and economic insights by subscribing to our Business newsletter<\/a> \u2013 your essential weekly round-up of all the business news you need.<\/p>\n","protected":false},"excerpt":{"rendered":"\u201cThe discussions are for a strong El Ni\u00f1o, but overall we don\u2019t think it\u2019s going to have massive…\n","protected":false},"author":2,"featured_media":472732,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[16891,26216,6689,60698,806,3013,802,124,7123,3914,83585,3233,4493,71830,7240,117,111,43,139,192804,69,97996,2515,15216,312,12975,7812,3271,4998,175603,80,2963],"class_list":["post-537660","post","type-post","status-publish","format-standard","has-post-thumbnail","category-new-zealand","tag-able","tag-agricultural","tag-agriculture","tag-although","tag-as","tag-but","tag-costs","tag-could","tag-current","tag-economist","tag-el","tag-farm","tag-increased","tag-input","tag-lead","tag-new","tag-new-zealand","tag-news","tag-newzealand","tag-nio","tag-nz","tag-pattern","tag-raise","tag-resilient","tag-says","tag-sector","tag-seen","tag-should","tag-weather","tag-withstand","tag-zealand","tag-zealands"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/537660","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=537660"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/537660\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/472732"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=537660"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=537660"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=537660"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}