Stock firm's debt hiatus hits farmers

An Ashburton stock firm's temporary stop to trading in livestock because of cashflow problems has sent shockwaves through the agricultural service industry.

Cuttle and Isaacs told creditors in a letter signed by directors Peter Bell and Michael Buchanan that "a significant overdue debt" prevented the company from paying its accounts.

Another delay had further held up payment, which directors were trying to resolve, the letter said.

"Provided the debt is fully recovered, you may expect to be paid in full, plus interest."

The Otago Daily Times said individual debts exceeded $100,000. Much of the outstanding money was owed to farmers from whom the company had bought livestock.

The agricultural servicing sector has been rocked by the news, and industry sources said it would again put the industry and the issue of payment guarantees under scrutiny, as happened after the 1994 collapse of the Fortex meat company.

Others were disappointed that a company considered stable, innovative and providing competition for the mainstream stock and station companies was in trouble.

"They're a good firm, they're innovative and have done the job well over the years," one source said.

Others saw it as a wake-up call for farmers quick to take the best price on the day at the possible expense of certainty of payment.

Neither Mr Bell nor Mr Buchanan has returned telephone calls, but the letter said creditors would be updated next week.

Cuttle and Isaacs, established more than 20 years ago, operated as livestock brokers and auctioneers, but has stopped trading in livestock until it can resolve the issue.

The company was active throughout much of the country and considered one of the larger independent stock firms operating in New Zealand, with agents in mid-Canterbury and the lower North Island.

- NZPA