Farming feeling changes most

Press, 2 June 1986, Page 2

Farming feeling changes most

PA Wellington The “painful” adjustment the country was going through was most acute in some parts of the farming sector, said Sir Ronald Trotter, the chief executive of Fletcher Challenge. He told the Young Nationals’ conference in Palmerston North that the dilemma of some farmers was tragic. Sir Ronald also said the company’s rural trading group was "taking a hammering” and was facing “massive reorganisation to keep costs down and stay in business.” He told the Young Nationals that farmers everywhere were in trouble. Land prices in the United States and Australia had plummeted, and many farmers were forced out of business.

At home, past policies drove some farm land prices “far beyond values justified by the earnings stream they were capable of generating.” “Poor income prospects were partly accepted because of the prospect of capital gains in an environment of high inflation and artificially suppressed interest rates,” said Sir Ronald. “Much has been said about an excessively rapid reduction of assistance to farming, and an excessively rapid adjustment generally. “The facts are, however, that of the $lOOO million assistance being provided farming a couple of years ago, about three-quarters was still paid out in the 1985-1986 year.”