New Zealand's farmers have kicked off 2010 with an air of positivity – but much is riding on factors well outside their control.Just before Christmas, Rabobank's quarterly confidence survey revealed a brightening outlook for most in the agriculture
New Zealand’s farmers have kicked off 2010 with an air of positivity – but much is riding on factors well outside their control.
Just before Christmas, Rabobank’s quarterly confidence survey revealed a brightening outlook for most in the agriculture industry with dairy farmers leading the charge.
Nearly half of all dairy farmers surveyed expected the agricultural economy to improve, while just 10% thought it would worsen.
Of the naysayers, more than half suggested the rising New Zealand dollar was the biggest problem while 30% cited uncertainty over commodity prices as the biggest issued. A further 29% were worried about overseas markets and foreign economies and their influence on New Zealand’s.
However, 62% said rising commodity prices would have the biggest influence on improvement in the agriculture economy. Nearly three-quarters of dairy farmers and 80% of horticulturalists were looking towards improvements in commodity prices as the 2010 financial saviour while just 48% of sheep and beef farmers agreed with the thought.
More than half of the farmers surveyed thought the value of their land would remain the same throughout the year while fewer than a quarter thought it would either increase in value or decrease.
Rabobank New Zealand general manager Ben Russell said while the continuing rise in overall confidence was positive, it was boosted by the increase in confidence in the dairy sector and was in start contrast to some of the other commodities.
“The survey has shown some striking differences in the confidence levels between dairy and other farmers,” he said.
This latest survey showed New Zealand farmers’ investment intentional had also strengthened with 87% expected to maintain or increase their farm business investment – up from 80% in the previous quarter.
Mr Russell said if the world economy continued to recovered at its present rate, the positive indicators shown by dairy in the survey would show up in other commodities as 2010 progressed.
“We would expect even a small drop in the New Zealand dollar to have a big impact on confidence levels across all commodities, but particularly for sheep and beef,” Mr Russell said.
