Tuesday, 24 October 2023 12:55

Farmer confidence hits a new record low

Written by  Leo Argent
Rabobank New Zealand country banking general manager Bruce Weir. Rabobank New Zealand country banking general manager Bruce Weir.

Rabobank's latest rural confidence survey shows a minus 72% confidence reading - eclipsing last June’s historic minus 57% - the lowest in the survey’s 20-year history.

Some 77% of farmers expect conditions in the broader agricultural economy to worsen over the next 12 months, with only 5% expecting conditions to improve. Rabobank New Zealand country banking general manager Bruce Weir says lower commodity prices are the main source of farmer anxiety, with 54% of farmers attributing this as a reason for their pessimistic view on the year ahead.

“Following our last survey, we saw Fonterra lower the mid-point of their farmgate milk price forecast from $8.00kg/MS to $6.75kg/MS, while schedule prices for sheep and beef products have also tumbled,” Weir says.

“Fonterra’s subsequent revision of the milk price to a new mid-point of $7.25kg/MS is a significant boost for the industry. However, this lift was made after the survey period and is therefore not reflected in the latest results.”

Other pressing concerns for farmers are rising input costs (46%), government policies (35%), overseas markets (29%) and rising interest rates (18%). The latest survey show that – for the first time since 2020 – government policy was not in the top two main reasons for concern. It was also cited as the main reason for optimism among farmers expecting conditions to improve.

Other pressing concerns for farmers are rising input costs (46%), government policies (35%), overseas markets (29%) and rising interest rates (18%). The latest survey show that – for the first time since 2020 – government policy was not in the top two main reasons for concern. It was also cited as the main reason for optimism among farmers expecting conditions to improve.

Weir urges farmers not to overlook their own health and wellbeing, with the survey finding more farmers less optimistic about the prospects for their own farm businesses and more likely to view their operations as unviable.

There is a small silver lining though, with an uplift in growers’ confidence in their operations, rising from -8% to +22%.

Rabobank says it has launched a new module of its free one-day financial skills workshop. It will run 19 workshops across the country, open to its clients and non-clients, with more scheduled to come in late 2023- early 2024.

“Given all the challenges facing industry participants, it’s important to reaffirm Rabobank’s commitment to our food and agri clients and to the wider sector,” Weir says.

More like this

Good times return

Following several years of pain, farmers and growers are facing a decent upswing in commodity prices, say economists.

Featured

RWNZ applauds hormone patch funding rethink

Rural Women New Zealand (RWNZ) says it welcomes recently announced consultation on Pharmac’s funding of ostradiol patches used by women going through perimenopause and menopause.

East Coast Expo delivers two action-packed days of events

The recent East Coast Farming Expo, held over two days at Wairoa, offered an insight into the current state of agriculture on the east of the North Island, at a time when the locals are remembering the second anniversary of Cyclone Gabrielle.

National

Machinery & Products

Alpego eyes electric power harrow

Distributed by OriginAg in New Zealand, Italian manufacturer Alpego recently showed its three metre Alysium electric power harrow at the…

» Latest Print Issues Online

The Hound

Dodgy!

OPINION: If you believe Maori Party president John Tamihere’s claim that “nothing dodgy” occurred at Manurewa Marae during the last…

» Connect with Rural News

» eNewsletter

Subscribe to our weekly newsletter