Farmer confidence slumps
Latest poll echoes the business sentiment surveys
New Zealand farmer confidence tumbled in January as a drought and uncertainty over new government policies took their toll.
A net 34 per cent of those surveyed were pessimistic about general economic conditions over the next 12 months.
That is a marked deterioration from 16 per cent who were optimistic in July, according to the latest new season Federated Farmers’ Farm Confidence January survey.
Within the different industry groups, 43 per cent of dairy farmers said they now expected general economic conditions to worsen over the next 12 months versus 5.8 per cent in July, 34 per cent of meat and fibre farmers were expecting the same, versus 12 per cent in July, while 47 per cent of arable farmers were expecting a deterioration, versus 12 per cent in July.
The farmer confidence survey echoes the business sentiment surveys showing growing pessimism about the country’s economic fortunes under a new administration, triggering Finance Minister Grant Robertson to acknowledge the mood at a select committee hearing last month and say ministers are seeking to allay those concerns.
“Pretty much all recent surveys of businesses have found a drop in confidence because of the disruption and uncertainty over October’s general election. And in mid-January, when our survey was done, farmers in many regions had endured weeks and weeks of little or no rain,” Federated Farmers vice president Andrew Hoggard said. On farmer profitability, 54 per cent said they are generating a profit, 35 per cent were breaking even and 9.3 per cent were running at a loss.
Similar to the July 2017 survey, the greatest concern for farmers was regulation and compliance costs.
The dry weather was also on their minds, and worry about climate change policy and the potential for livestock emissions to be included in the emissions trading scheme showed a marked increase, Hoggard said.
Also, compared to previous years, biosecurity concerns such as pests and diseases is more evident and at the highest level ever seen in these surveys. The January online survey received 1070 responses from farmers across 24 provinces.
Forty-three per cent of dairy farmers expect economic conditions to worsen over the next 12 months versus 5.8 per cent last July.