Federated Farmers' New-Season Farm Confidence Survey, undertaken at the start of the 2013/14 season, has shown a major turnaround in farmer confidence, particularly dairy farmers.
Farmers are showing a lot more optimism in both the wider economy and individual farm prospects, says Bruce Wills, Federated Farmers President.
"Dairy farmers remain the most optimistic industry group with very strong survey indicators and this isn't really that surprising, given current payout forecasts and expectations of a recovery in production," says Wills.
"We are especially pleased to see Sheep and Beef farmers feeling more optimistic. Admittedly this comes off a low base following a very tough 2012/13 season; something I can speak of with first hand experience.
"Sheep and Beef farmers are heavily focused on the problems they see with the red meat industry. This is something Federated Farmers is engaged upon as we have a singular focus to ensure viable and sustainable red-meat and fibre farming.
"When we looked at farmer concerns, the biggest one is regulation and compliance costs. When we drilled into respondent comments, this appears mainly related to regional council plans regarding water quality.
"It concerns us that a large number of respondents cited Horizon's 'One Plan' and other plan changes in Southland, Otago, Canterbury, and Waikato.
"Farmgate and commodity prices and the weather were the next most pressing issues of concern."
The timing of this January survey meant it did not fully pick up the impact of the late summer-autumnal drought.
"While the drought meant the second half of the 2012/13 season was tough and this 2013/14 new season survey finds encouraging improvements, the gap in sentiment between dairy and the rest of farming remains large," says Wills.
Headline results from the Farm Confidence Survey:
• A net 34.2 percent of respondents expect general economic conditions to improve over the next 12 months
• A net 33.7 percent of respondents expect their own farm's profitability to improve over the next 12 months
• A net 28.3 percent of respondents expect to increase production over the next 12 months
• A net 11.0 percent of respondents expect to increase on-farm spending over the next 12 months
• A net 21.5 percent of respondents expect to their farm debt to reduce over the next 12 months
• A net 15.6 percent of respondents found it harder to find skilled and motivated staff over the past six months
• Respondents' biggest single concern was regulation and compliance costs, cited by 19.9 percent of respondents
• Respondents' highest priority for government is fiscal policy (i.e., reduced government spending and/or reduced government debt), cited by 14.9 percent of respondents.
