Global economic woes weigh on NZ farmer confidence

Global economic woes weigh on New Zealand farmer confidence

Concerns about a deteriorating global economy and the outlook for agricultural commodity prices have put a dent in New Zealand farmer confidence.

The latest quarterly Rabobank Rural Confidence Survey has shown a drop in New Zealand farmer sentiment, following two previous quarters of high confidence levels.

The survey – taken earlier this month – found only 35 per cent of the countrys farmers expected the agricultural economy to improve in the next 12 months, compared to 48 per cent withthatviewintheprevioussurvey. Thoseexpectingconditionstoworsenincreasedto10 per cent, from six per cent previously.

Rabobank general manager New Zealand Ben Russell said the results “equated to a drop in net confidence from 42 per cent to 25 per cent”.

Worries about the deteriorating global economy, along with concerns about the sustainability of high agricultural commodity prices, were the main factors contributing to farmers negative sentiment.

Of those expecting the agricultural economy to worsen, 44 per cent cited overseas markets/economy and 31 per cent nominated falling commodity as reasons for their pessimism.

“While agricultural conditions have been good across most of the country, farmer sentiment is being influenced by external factors, in particular concerns about the global economy and the public debt issues being faced in Europe and the United States,” Mr Russell said.

See the full report here: Rabobank_Rural_Confidence_Survey_media_release_Oct2011.pdf

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