Survey shows big jump in number of farms making a profit
A few weeks of winter remain but the Federated Farmers July Farm Confidence Survey shows there’s a spring in the step of
those who work the land.
The responses to Research First from nearly 800 farmers show the highest level of confidence in current general economic
conditions since 2014. Dairy and arable farmers are the most optimistic looking forward and all regions are
demonstrating more optimism compared to the last survey, in January this year.
Compared to 12 months ago, the proportion of farms making a profit has doubled (55.4% percent versus 27 percent in July
2016). Notably, the percentage of all farms making a loss has substantially decreased by a factor of four (9.6 percent
in July 2017 compared to 42.5 percent in July 2016), particularly within dairy and ‘other’ farm groups (goats, rural
butchers, high country, bees), and those farms based in the Auckland-Northland and Otago-Southland regions.
Federated Farmers Economics and Trade spokesperson Andrew Hoggard says this is consistent with strong recovery in
commodity prices and farm incomes since mid- 2016 for most farm produce, and the continued absence of farm expense
inflation.
Good news for the nation and the provinces is that a net 32.3 percent of farmers expect their farm production to
increase over the coming 12 months (up 16 points on the January survey) and a net 19.1 percent expect their on-farm
spending to increase over the coming 12 months (up 17 points on January), Andrew says.
A net 35.9 percent of farmers expect to be able to retire some farm debt over the next year but on the downside, a net
25.6 percent say it has been harder to find skilled and motivated staff this year.
"The survey showed the biggest concern for farmers is regulation and compliance costs, which has leap-frogged over
farmgate and commodity prices (now in second place). The public perceptions of farming is third on the list of concerns
and the environment is fourth."
Andrew says the survey shows that farmers rate reducing regulation and compliance costs as the highest priority for the
government, followed by the economy and business environment, gaining re-election, and biosecurity.
ENDS