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The challenges of farming in Mid-Canterbury
An interview with Ron and Judith Armstrong
Part 3
Improvements well established, but problems insuperable - expensive
electricity and labour costs and sudden government policy changes
Dorothy - 13/10/03
Irrigation
The dry conditions in the land between Rakaia and the sea made farming very
difficult. The light topsoil would be blown away in the strong winds.
However, talking about the need did not result in rapid action. Proposals
for border dyking were not accepted and low-interest loans for irrigation
from the Rural Bank did not last.
In the mid-fifties a Government scheme was proposed to bring water from the
Rakaia River near Barrhill
to just west of the Rakaia township. Border dyking was the proposed method
to irrigate farmers' land from Rakaia to the sea. If the farmers had voted
for the scheme every farmer would have had to develop his own layout and
border dyking. Only landholders had a vote and the scheme was voted out.
In later years the Rural Bank lent money to farmers at low interest for
installing irrigation. The Armstrongs first used a Big Gun and then
installed three Rotorainers on their farm and one on their son's farm.
Water for the irrigation came from underground wells. Twelve inch pipes
had to driven 180 feet into the ground. Where the farms were in close
proximity to the sea the water table was higher than further inland where
the farmers had to drill down to 500 feet. They needed 600 gallons of
water a minute to be of worthwhile benefit. The twelve inch pipe formed a
casing to carry the pump.
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Pipe being driven for installation of the pump
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Four drillings produced three wells. In the search for water farmers used
water diviners.
Impact of irrigation
Irrigation made the greatest impact on change to the policy of farming.
The Rotorainers had to be shifted every twenty four hours and each shift
took two hours. In this aspect farming was more labour intensive. However
the irrigation meant that there was more green feed which is better for the
stock than too much dry feed. This meant a reduction in labour as there
was less feeding out and hay making.
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A Rotorainer in action
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Effect of rising electricity costs
In an average year the power bill for the irrigation would be $40,000; in a
dry year $60,000. There was a subsidy to assist farmers, but with the
rising cost of electricity this expense was still a major burden. The
returns from meat and wool were not sufficient to meet the costs. Because
the bills for irrigation were so high more and more of the land was used
for cropping. More cropping meant more farm machinery. It was a vicious
circle financially.
Financial pressures
By 1985 the land, machinery and stock were valued at a capital value of
around $2,000,000. For a project of the same size in the city there would
have been several staff, but on the farm finance didn't allow for more than
Ron and one staff member to do all the varied facets of the work.
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The Armstrongs' farm from the air
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Production by squeeze
Especially once irrigation was installed in 1972 theirs was a high cost
form of farming. The government policy was such that it was 'production by
squeeze'. Everyone was being asked to produce more just to stand still.
They tried to maintain their income by increased production. Over the
years the number of sheep had been increased from 500 to 3000. At the same
time the costs were constantly increasing, especially in an economy where
inflation was at 18%. It wasn't possible to overtake the costs with
production. There is a limit to what can be produced on one piece of land.
They were just standing still in terms of money.
Farm subsidies
The Rt. Hon Robert Muldoon, Prime Minister in the National Government from
1975 to 1984, introduced subsidies for farmers to enable them to compete
pricewise with the British farmers who were heavily government-subsidised
on their meat and wool. This was possible in the United Kingdom because
there was a large industrial structure.
In New Zealand one year farmers got a one-off payment on lamb and cattle,
$1.00 per lamb and $6.00 per cattle beast. Subsidies were given on sprays
and fertilisers. In Ron's view subsidies should be accompanied by price
fixing of the product being subsidised. As subsidies were applied to
sprays and fertilisers the price went up so steeply that the farmers were
little better off.
New Zealand subsidies did not compare with the subsidies in the United
Kingdom which applied to calves, lambs, machinery and farm buildings, and
even on land left out of production, under the law which required that a
fixed percentage of the farm was to be left fallow.
Changes in government policy
Three months before the Labour government was elected in 1984 the
Armstrongs bought a second farm for their son. The home farm provided part
security for the purchase.
After the Labour Government was elected mortgage interest rates went from
11% on first mortgages and 14% on second mortgages to 22% at one jump. The
subsidies for farmers were considered to be too great a burden on the New
Zealand taxpayer and in 1984 Roger Douglas abruptly removed them at short
notice. Gradual phasing out of subsidies and gradual changes in mortgage
rates would have give the farmers a chance to adjust and change their
plans. Sudden changes left no choices.
The Rural Bank
The Rural Bank was the Government lending agency and had lent freely,
perhaps too freely, at low interest rates. With the change of Government
policy their interest rates rose dramatically in keeping with the bank
rates of the time.
Distressing impact on the Armstrongs and many other farmers
The result of the changes in Government policy was that the Armstrongs had
to sell both of the farms and retire to the town. Their sons had to find
work elsewhere and the family's connection with the land to which they had
devoted so much effort was over. They emphasised that they
were just one family of many hit by the Government's abrupt change of
policy. Because of the financial pressures on farmers sales were forced
throughout the country. One third of the Dorie farmers had to leave their
farms.
Ron and Judith's view
As Ron and Judith expressed it, "The land is always more important than the
people who use it. It will always be there, but we are just the temporary
tenants."
Visit the rest of the articles in this series:
Part 1: An interview with Ron and Judith Armstrong - Farm training, farm purchase, and marriage
Part 2: An interview with Ron and Judith Armstrong - Problems developing a neglected property - too little money and too much work
Part 4: Farming changes in Dorie since 1990 - problems with water, new dairy farms
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