Federated Farmers: Feds rally to ease sharemilking strain

Sharemilkers are under pressure dealing with the recent industry downturn.

Federated Farmers and DairyNZ have launched a free facilitation service to assist variable order sharemilkers (VOSM) during the current season of low milk price.

The service was established after results from a recent Federated Farmers survey highlighted a high level of stress among variable order sharemilkers -- with over a quarter of respondents concerned about their business model.

More than 75 per cent of survey respondents have reduced their herd size, 47 per cent laid off staff while 8 per cent have changed their business model -- converting from a sharemilking agreement to either a contract milking or farm manager one.

The discussions and solutions are going to be different for herd owning sharemilkers as opposed to VOSM.

Federated Farmers Sharemilkers' Employers Section chair Tony Wilding said, "It's encouraging to see how sharemilkers and farm owners who use sharemilkers are pulling together to keep their business viable."

The survey also found the majority of farm owners are taking action to support their sharemilkers in ways they wouldn't usually be doing in an effort to keep the sharemilking business sustainable.

Two-thirds (67 per cent) of farm owners are paying for feed, 22 per cent are covering electricity costs and over half are paying for professional advice to their sharemilker.

"It's great to see farm owners being proactive and exploring different options to help their sharemilkers through this current downturn and we're encouraging those who haven't already to ask their sharemilkers about their financial position and get the conversation going," Mr Wilding said.

Federated Farmers has established a network of dairy farmers around the country who are available to help facilitate conversations between sharemilkers and farm owners regarding their business model and the contracts in place between them.

"We've been working with banks, DairyNZ and others to provide all the support we can over the past few months. We want to do whatever we can to help them and ease some of the pressure.

"This facilitation service leverages our greatest strength -- a nationwide network of experienced farmers," he said.

Federated Farmers' facilitators were experienced dairy farmer members, who were identified by their provincial organisation as they understood the demands and pressures of sharemilking.

"It's targeted primarily at those sharemilkers who are not confident or comfortable in starting this conversation and are probably at the entry point of VOSM, with no real asset backing to borrow or those recently settled HOSM that have had a big hit on their equity with a drop in stock values.

They also, or who believe the discussion would benefit from a third party facilitation," said Mr Wilding.

Sharemilkers can access the free service by contacting Federated Farmers on 0800 327 646.

There is also a range of other information and support tools available to sharemilkers from the Federated Farmers and DairyNZ websites.