Significant barriers need to be overcome if New Zealand's red meat sector is to again be a driving force in the economy.
That was the finding of new ANZ research that underlined the ''huge'' performance potential of the industry, while also highlighting issues that needed to resolved.
Top performing farmers were achieving returns on investment that outshone most other producers in New Zealand, but a larger number of farms were achieving more modest returns, the annual ANZ privately owned business barometer survey found.
ANZ commercial and agri managing director Graham Turley said the challenge was to narrow the range of performance in the industry.
Issues identified included an ageing industry, with the average age of the red meat farmer nearly 60.
Farmers faced new compliance pressures that were contributing to stress and low confidence.
While the industry agreed on the need for more integration between farmers, processors and the market, the survey found widespread belief there was insufficient progress on that.
Respondents to the survey were ''significantly less optimistic'' than other sectors about the New Zealand economy, their own sector and their own business.
ANZ's latest Agri Focus said another decline in breeding ewe numbers was expected. Mutton turn off was persistently above expectations in 2014 15, pointing to a 300,000 500,000 head reduction in ewe numbers.
Scanning results seemed to be 10% 15% below last year. Year to date total cattle production was up nearly 11% to 2.27 million head.
Nearly 70% of the increase was due to cull cows, which would be more than one million head for the first time.
Most of the increase would be budget dairy cows turned off in response to lower milk prices. Bull beef had also increased.
