NZ farmers more optimistic as agricultural confidence rises
According to the most recent Rabobank Rural Confidence Survey, farmer confidence has inched higher, reaching its second highest reading in the last decade.
This is despite improved confidence in their own farming operations, according to the latest Rabobank Rural Confidence Survey.
The survey, completed earlier this month, found that after rising strongly in the last two quarters, farmer confidence in the broader agri economy has reversed course, falling to -25% from -16%.
The survey also found that farmers’ expectations for their own farm business operations were up across all parts of the sector, with the dairy industry rising from +5% to +10%.
Rabobank chief executive Todd Charteris says that while it’s disappointing to see headline confidence fall, there were still some positives.
“We generally do see the reading for farmers’ confidence in their own businesses sitting a little higher than for the broader agri economy, but the two measures do almost always move in the same direction, so it is a bit unusual to see them taking diverging paths this quarter,” Charteris says.
He says one possible reason for this is that farmer concerns about the overall economy are feeding into pessimism about the prospects for the agri economy.
Additionally, Charteris says that dairy farmers saw healthy price rises on the Global Dairy Trade (GDT) auction platform during May and June which will likely have lifted sentiment. Also marginally improved was sentiment around farm viability.
“Last quarter, we saw 9% of farmers self-assessing their operations as ‘unviable’ with this now dropping to 7%,” Charteris says.
Additionally, at the top end, the survey also saw a small lift in the proportion of farmers assessing their businesses as ‘easily viable’ with this up 2% to 16%, he says.
Regardless, Charteris says what is clear is that farmer sentiment remains subdued. “Given the importance of the sector to the wider economy, it really is essential that everyone involved with the industry bands together to support the country’s food producers and to get things moving in the right direction.”
